Azerbaijan’s SOCAR to assist in Albania’s gasification

Tirana Times
By Tirana Times March 13, 2015 10:24

Azerbaijan’s SOCAR to assist in Albania’s gasification

TIRANA, March 11 – Azerbaijani state oil company SOCAR says it will contract a company to carry out a feasibility study on Albania’s gas infrastructure plan ahead of the construction of the milestone Trans Adriatic Pipeline bringing Caspian gas to Europe through Albania.

“SOCAR will announce a tender in the next three months,” Murad Heydarov, adviser to SOCAR’s president, has told Reuters.

“We should draft the feasibility study before the end of 2015, and if this project is considered effective, we will start Albania’s gasification project in March next year,” he said, adding that the project’s cost is estimated at several hundred million dollars.

The feasibility study will be conducted as part of a deal the Albanian government signed with Azerbaijan’s SOCAR company, which holds a 20 percent stake in TAP, to assist in the country’s gasification considering a complete lack of infrastructure.

“Albania should not lose its chance and the country should not suffice with the fact that a gas pipeline passes through which is very important strategically. We are working to get huge economic benefits from gas. I can say that there are interested partners and that we will have a full master plan next year,” Energy Minister Gjiknuri said late last year in a visit to Azerbaijan.

With domestic electricity generation 100 percent dependent on hydropower plants and rainfall, TAP would be another opportunity to diversify generation especially in the newly-built Vlora thermal power plant which although made available for use since more than one year has not been made operational because of its high cost on fuel operation. TAP would also help the country’s gasification by offering gas, already massively used as a cheaper alternative to electricity for cooking and heating, although the country’s buildings lack gas infrastructure. The passing of the oil pipeline through Albania would also pave the way for the construction of the Ionian-Adriatic pipeline making Albania a gas hub to other Balkan regional countries, experts say.

TAP is scheduled to start construction in June 2015 and carry the first gas by 2019. TAP officials say Albania will benefit around 1 billion euros in investments from TAP’s construction in the next three years. The pipeline will transport natural gas from the giant Shah Deniz II development in Azerbaijan through Greece and Albania to Italy, from which it can be transported farther into Western and Central Europe.

TAP will generate one of that Albania’s largest FDI projects, with important benefits for a number of industries, including manufacturing, utilities and transport, experts say.

A study conducted by the prestigious Oxford University has demonstrated the substantial potential economic benefits for Albania by the landmark pipeline. Findings by the Oxford Economics study show that during its four years of construction (2015-18), inclusive of direct, indirect and induced effects, TAP will contribute a total of Euro 370 million to Albanian GDP, create, on average, 9,900 jobs per year and generate Euro 90 million for the Albanian treasury.

TAP’s shareholding is comprised of UK’s BP (20 percent), Azerbaijan’s SOCAR (20 percent), Norway’s Statoil (20 percent), Belgium’s Fluxys (19 percent), Spain’s Enagás (16 percent) and Switzerland’s Axpo (5 percent).

Tirana Times
By Tirana Times March 13, 2015 10:24