Socar to Pick Europe Link for Azeri Gas After Talks With Buyers
State Oil Co. of Azerbaijan, a partner in BP Plc (BP/)’s Shah Deniz gas field, said a decision on fuel-export rights will be determined by talks with buyers as European countries seek to reduce reliance on Russia.
“Our choice will depend on the results of talks with buyers of gas in the countries where the pipeline links are directed to,” said Vaqif Aliyev, vice president of the state oil company known as Socar. “We’ll select the link taking into account the volume and price of gas supply and other factors.”
The OMV AG-led Nabucco West pipeline is competing with the Trans-Adriatic Pipeline, developed by Statoil ASA (STL), EON Ruhrgas and EGL AG, for rights to export 10 billion cubic meters of Shah Deniz gas a year to the European Union from the Turkish border. The BP-led group of field developers, including Socar, Statoil and Total SA (FP), will choose between the two by the end of June.
Exports, scheduled to start in 2019, will help Europe curb dependence on deliveries from Russia, which supplies about a quarter of the region’s gas. The offshore Shah Deniz field is Azerbaijan’s largest gas deposit, holding an estimated 1.2 trillion cubic meters.
The fuel will travel first through a BP-led pipeline to Turkey, then via the proposed Trans-Anatolia Pipeline, or Tanap, to the Bulgarian border. At that point, Nabucco West or the Trans-Adriatic Pipeline will take the gas further westward. Socar will seek a share of the winning project, Aliyev said.
BP, Statoil and Total are also seeking to join the Tanap venture, and are in talks with 80 percent shareholder Socar, Aliyev said. BP and Statoil would each buy a 12 percent stake from Socar, while Total would get 5 percent. Socar would retain 51 percent, with the remaining shares held by Turkey’s Turkiye Petrolleri AO and Boru Hatlari Ile Petrol Tasima AS, he said.
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