BAKU, Aug 05ؔhe consortium developing Azerbaijan’s major gas field, Shah Deniz, is to begin talks with potential customers for 10bn cubic metres of gas per year.
The gas will be produced as part of the second stage of development of the offshore field.
A spokeswoman for consortium member Statoil said on Wednesday that the talks were at the planning stage.
“We’re planning bilateral negotiations with potential customers…,” the spokeswoman said in a response to emailed questions from Dow Jones.
She added that the customers included three “potential pipeline projects”, but did not name any of them.
Three potential customers
Three pipeline projects designed to pump gas to Europe via what is known as the Southern Corridor have made no secret of their interest in Shah Deniz gas.
The chief executive of the Nabucco pipeline project, Reinhard Mitschek, said in Baku in June that, “Azerbaijan is one of the most important countries in the issue of gas supplies for Nabucco. We mostly propose taking gas for this project from the second stage of the Shah Deniz field.”
A spokesman for the Trans-Adriatic Pipeline (TAP), which will supply gas to south-eastern Italy via Greece and Albania, in June described stage two of Shah Deniz as a potential source of gas.
The Interconnector Turkey-Greece-Italy (ITGI) pipeline is also being built with Azerbaijani gas in mind. An official of ITGI shareholder Edison, Elio Ruggeri, told a conference in March that only Azerbaijan was capable of delivering new supplies of natural gas to the European market in the next few years, with the development of Shah Deniz Stage 2.
Nabucco is to have an annual capacity of 31bn cu.m, TAP of 10bn cu.m and ITGI of 8-10bn cu.m.
Reducing dependence on Russian gas
The EU is keen to see Azerbaijani gas supplied to Europe as it will help diversify supply routes and reduce dependence on Russian gas.
Heinz Hilbrecht, director for security of supply and energy markets at the European Сommission’s Directorate General for Energy, told a Baku conference in June: “We are working on gas supplies within the framework of the second stage of the Shah Deniz field development and the European Commission has already expressed interest in supplies of Shah Deniz gas via the Southern Corridor. This proves the growing role of Azerbaijan for the whole of Europe and its increasing potential to diversify energy sources.”
He said that the Nabucco, Turkey-Greece-Italy and Trans-Adriatic gas pipeline projects were mutually complementary systems.
A strategic vision in the Balkans
Now is the time for big strategic vision in the Balkans. The Albanian Prime Minister has already voiced his interest in turning Albania into a mini gas hub, by using the country’s favorable geographic position to offer natural gas in LNG form to international buyers and link Albania with Italy under the Adriatic Sea. Macedonia has similarly expressed an interest in new and stable supplies of natural gas. Kosovo’s energy market is under-supplied, and Pristina desperately needs to figure out a way to bring up its energy supply in order to keep alive its post-independence economic boom. Burning lignite coal, which is the current plan, is not an environmentally responsible decision, which in the end will cause problems for Kosovo in its negotiations with the EU.
