TIRANA, Sept. 11 – The U.S. and EU have reconfirmed support to the Ionian Adriatic Pipeline, a proposed extension of the under construction Trans Adriatic Pipeline, that will supply natural gas to Montenegro, Bosnia and Herzegovina and Croatia through Albania in a bid to reduce dependence on Russian gas and influence in South-East Europe.
The IAP project comes as TAP has already completed 70 percent of the project route in Albania and Greece and is on track to deliver the first Caspian gas to Europe through Italy by 2020.
The proposed IAP project is a 511 km pipeline, requiring a total of €618 million in investment, with the 162 km Albania-Montenegro segment estimated to cost €288 million, making funding the key issue for its implementation at a time when all Albania, Montenegro, Bosnia and Herzegovina and Croatia have expressed full support to the project.
U.S. ambassador to Albania Donald Lu said IAP will benefit Albania through cheaper natural gas prices and the diversification of its electricity sources and free South East Europe from the influence of Russian gas.
“Gas has to do with power. We are fighting for this corridor as it helps cooperation among Balkan countries and frees Europe from its dependence on Russian gas. Albania plays a key role in this gas pipeline and we are very close to making this dream come true,” said Ambassador Lu.
“The Unites States has always supported this corridor which together with the Greece-Bulgaria interconnection, increases the diversity of energy supply for Balkan countries. The Balkans is known for its wars among neighbors, the IAP pipeline is important because it is based on regional cooperation and security. For this reason, you have the U.S. support,” said Ambassador LU.
The European Union which has already supported the project’s initial stage under the Western Balkans Investment Framework, says the project will be crucial for energy security in the Balkans.
“The gasification of the Western Balkans makes the countries at the same time more inter-connected and closer to European standards. In this historical perspective, the reform of the energy sector and the emergence of a regional energy market connected to the EU energy market are crucial in ways that go way beyond energy objectives,” said EU ambassador to Albania Romana Vlahutin.
“The Ionian Adriatic Pipeline would multiply the benefits of the Southern Gas Corridor and the TAP, by allowing the gasification of Croatia, Bosnia-Hercegovina and Montenegro. At the same time, it would give those countries and Albania access to the forthcoming LNG terminal in Croatia,” she added.
The EU says it is ready to provide investment grants for the Albania and Montenegrin parts of the investments and “will remain supportive of closer cooperation with all the stakeholders and potential investors to get this priority project implemented on time.”
Albania’s Energy Minister Damian Gjiknuri said the IAP project is also expected to have a major contribution to the gasification of Albania, Kosovo and Montenegro, Europe’s only three countries where the gas sector and infrastructure is almost inexistent.
“The TAP project is the main pillar supporting the development of the gas sector in Albania, however, a primary role in the country’s gasification will also be played by IAP, which is not only a natural extension of TAP, but also provides a realistic solution to energy security in our region, bringing economic progress for the countries it passes through, but also increasing political stability,” said minister Gjiknuri.
“Three of the IAP countries are already NATO members, making IAP even more essential when it comes to strategic interests in the region,” he added.
The energy minister said IAP was already facing serious technical barriers requiring its support by at least two EU member countries in order to make it to the list of Projects of Energy Community Interest (PECI).
Azerbaijan’s state-run SOCAR company and Spain’s Enegas, both of which shareholders with 20 percent and 16 percent stakes in the TAP consortium, also participated at a project management unit meeting held last weekend in Tirana.
TAP which is expected to bring gas to Europe through Greece, Albania and Italy is generating one of the country’s largest foreign direct projects, with important benefits for a number of industries, including manufacturing, utilities and transport, with total investment of €1.5 billion.
Albanian experts have described TAP as an opportunity that would benefit Albania both economically and politically, making the country an important hub of the international gas pipeline for the Western Balkans. TAP would be another opportunity to diversify generation especially in the newly-built Vlora thermal power plant, help the country’s gasification by offering cheaper gas, already massively used as a cheaper alternative to electricity for cooking, heating, although the country’s buildings lack gas infrastructure. Liquid gas is also being increasing used as a cheaper alternative to fuel whose prices in Albania are among Europe’s highest, with thousands have shifted to natural gas powered-cars.
