The Southern Gas Corridor has officially opened in Baku. Alexander Zapolskis: Is the Southern Gas Corridor a competitor to Gazprom? (06/11/2018)

The first part of the Southern Gas Corridor project was opened in Baku, through which Azerbaijan will be able to directly export gas to Europe. President of Azerbaijan Ilham Aliyev took part in the ceremony. By turning the key, he symbolically launched the supply of “blue fuel” from the Shah Deniz field on the Caspian Sea shelf to Europe.

Azerbaijani diplomacy of the 21st century: the secret of success in the international arena

The Southern Gas Corridor consists of three puzzles. The first stage is the South Caucasus Pipeline (SCP). This gas pipeline connecting Azerbaijan with the Turkish city of Erzurum through Georgian territory was built back in 2007. But after the European Commission signed the declaration on the “Southern Gas Corridor” in 2011, a decision was made to expand the SCP. The pipeline runs parallel to the Baku-Tbilisi-Ceyhan oil pipeline, through which Azerbaijan exports oil to the EU through the Mediterranean port of Turkey.

Google Map Data, 2018

The second phase of the project is associated with the Trans-Anatolian Natural Gas Pipeline (TANAP), starting at the Turkish-Georgian border and crossing the whole of Asia Minor. At the Greek border, TANAP will be connected to the Trans Adriatic Pipeline (TAP), which runs through Greece, Albania and Italy.

President of Azerbaijan Ilham Aliyev. Photo: www.globallookpress.com

The first supplies of Azerbaijani gas to Turkey are scheduled for 2018. In mid-May, Turkish Energy Minister Berat Albayrak announced the opening date of TANAP. This will happen on June 12. The gas pipeline from Greece to Italy, to which Bulgaria intends to join via interconnectors, will be put into operation around 2020. TAP will provide about 17% of Italy's gas consumption.

The capacity of the Southern Gas Corridor is estimated at 16 billion cubic meters per year, six of which will go to the needs of Turkey, and the remaining 10 will be supplied to Europe.

New gas war between Russia and Ukraine: Gazprom does not intend to be a sponsor of the Kyiv regime

Will Azerbaijani gas compete with Russian exports? The capacity of the Turkish Stream, when its second line is built, will be twice that of the Southern Gas Corridor. And taking into account the almost 200 billion cubic meters that Russia annually exports to old light, 16 billion from Shah Deniz is unlikely to “make a difference” in the European market, where demand for gas is growing from year to year. We must also keep in mind the ongoing construction of the Russian Nord Stream 2, which will carry no less than 55 billion cubic meters per year.

It is worth noting that the Southern Gas Corridor is the fourth project aimed at increasing the energy transport independence of the South Caucasus republics from Russia. In 1999, the construction of the Baku-Supsa oil pipeline to Georgia was completed. Seven years later, the aforementioned Baku-Tbilisi-Ceyhan oil pipeline was built. At the same time, the Baku-Tbilisi-Erzurum gas pipeline was being implemented. By territory three countries— Azerbaijan, Georgia and Turkey — is underway and put into operation in the fall of 2017 Railway"Baku - Tbilisi - Kars".

The Southern Gas Corridor, as comparative statistics show, is not a direct competitor of Gazprom in the European gas market. Moreover, Russia itself is diversifying gas supplies at the expense of China.

Photo: Merkushev Vasiliy / Shutterstock.com

At the recent St. Petersburg International economic forum Japanese Prime Minister Shinzo Abe also announced his interest in “blue fuel” from Russia. A little earlier, Bulgarian President Rumen Radev hinted at the possible reincarnation of South Stream.

At the same time, to assert that the Southern Gas Corridor is not a project bypassing Russia would be strange, at least from a geographical point of view. Without pretending to compete, Azerbaijan is strengthening its status as an independent international player, without being tied to either Russia or the West. The EU and the USA, as well as Western companies led by BP (participating in almost all oil and gas projects in Azerbaijan) are interested in expanding their influence in the South Caucasus, and in the future weakening the role of Gazprom in Europe. But Azerbaijan’s deposits alone are not enough for this. Gas pipelines bypassing Russia have real power only if Iran and Turkmenistan, the 2nd and 4th countries in the world in terms of “blue fuel” reserves, are connected to them. But there are a number of obstacles on this path: the unresolved status of the Caspian Sea, which is preventing the construction of the Trans-Caspian gas pipeline, and the Kurdish factor, which complicates the supply of Iranian gas. The United States is also making its contribution by delaying the development of one of the ten largest gas fields in the world - “South Pars”.

Azerbaijani President Ilham Aliyev emphasized the role of Western countries in supporting the Southern Gas Corridor. Photo from the official website of the President of Azerbaijan

What Gazprom's opponents have been talking about for so long has come true. Azerbaijan yesterday launched with fanfare a new gas pipeline, the Southern Gas Corridor (SGC), which alternative route will deliver gas first to Turkey and then to Southern Europe. Although the volumes of Azerbaijani gas supplies are significantly lower than Russian exports to Europe, observers were impressed by the coincidence in the timing of the commissioning of this project with the expected arrival of the Turkish Stream from Russia.

Already in the first half of June, the famous Trans-Anatolian Pipeline (TANAP) is expected to be put into operation, through which gas from the Azerbaijani Shah Deniz field will flow from east to west through the whole of Turkey to Europe. And yesterday, Azerbaijani President Ilham Aliyev at a terminal near Baku solemnly launched the first gas into the Southern Gas Corridor, of which TANAP will become a part.

Gas will be delivered to Europe via complex system communications with a total length of 3,500 km: the SGC includes the expansion of the Baku-Tbilisi-Erzurum gas pipeline, the construction of TANAP and the Trans-Adriatic Pipeline (TAP). Gas will flow from Azerbaijan to Georgia, Turkey, Greece, Bulgaria and Albania - and to Italy. It is expected that 6 billion cubic meters. m annually under this system will be received by Turkey, and 10 billion will go further for the Europeans.

Yesterday, Turkish President Recep Tayyip Erdogan sent an address on the occasion of the launch of the first stage of the Southern Gas Corridor project; he called the project an important example of regional cooperation. And Ilham Aliyev thanked the USA, Great Britain and the EU for their political and economic support for the project.

The joint declaration on the Southern Gas Corridor was signed by Azerbaijan and the European Commission in 2011, but it coincided that its launch will take place just weeks after the signing by Gazprom and the Turkish government of the protocol on the second - transit - line of the Turkish Stream, in which gas intended for the same southern region Europe (see).

Obviously, a comparison of the two projects suggests itself (initially, the creation of the SGC was very politicized and was considered as important object opposition to “Russian gas hegemony in Europe”).

Let us recall that the first line of the Turkish Stream under construction is intended for supplies to Turkey itself, but the second is intended for further pumping to the countries of Southern and South-Eastern Europe. The capacity of the Russian pipe is greater; each line can pump up to 15.7 billion cubic meters. m of gas per year. The SGC will bring only 10 billion annually to Europe.

But the “stream” is just being built, sales prospects have not yet been determined at all. For supplies along the Balkan route, it is necessary to build another pipeline, 100 km between Bulgaria and Serbia. But the head of TANAP, Saltuk Duzyol, reported that his organization already has contracts for gas transportation for 15 years in advance. The Southern Gas Corridor project has been approved by the European Union. It is actively supported Western countries. True, the SGC is also not entirely ready; the Trans Adriatic Gas Pipeline (TAP) is expected to be built by 2020.

For Gazprom's business, the creation of a competitor to Turkish Stream, of course, does not cause direct harm. In 2017, Europe received 193 billion cubic meters from the Russian Federation. m of gas, this is about 37% of the total volume. However, the symbolic significance of a competitive pipeline is great, especially if Kazakhstan and Turkmenistan later join in supplies through it.

The creation of the SGC requires huge investments. According to Natural Gas Europe, the total investment in the project is about $40 billion, including TANAP worth 9.3 billion, TAP - 6 billion, the second stage of the Shah Deniz development and the expansion of the South Caucasus gas pipeline - 23.8 billion .

The head of the analytical department of the company "Golden Hills - Kapital AM" Mikhail Krylov believes that, given the volume of investments in construction along the complex route of the "corridor", its participants are unlikely to offer European consumers Better conditions than Gazprom. “We can assume that by participating in the project “ Southern corridor", Türkiye is insuring itself against force majeure on the Turkish Stream. Europe has enough worries of its own, and it is unlikely that it will stimulate the construction of new lines of this corridor, creating real threat Gazprom’s share in supplies to the EU,” Krylov told NG. According to the expert, the implementation of the project, the preparation of which has been discussed for so long, has now become possible due to the increased demand for gas transit to the countries of the Mediterranean and Central and Eastern Europe.

“The Southern Gas Corridor project will not become a limiter for Gazprom’s supplies. On the contrary, under a certain scenario, the right in Italy will achieve the integration of the entire Mediterranean into a single economic organism, in whose blue veins Russian gas blood will flow.”

The head of the department of the Institute of Energy Research of the Russian Academy of Sciences, Vyacheslav Kulagin, does not agree that the “corridor” is a kind of insurance for Turkey in case the Russian flow is disrupted. “This is not so, because the decision on the SGC was made before the Turkish Stream,” says Kulagin. Kulagin does not see anything strange in the “coincidence” in the timing of the launch of the “flow” and the “corridor”. In his opinion, the launch of the “corridor” is carried out in accordance with the field development plan. And in Europe, the need is growing against the backdrop of a decline in its own production. The expert also does not think that the participants in the “corridor” will offer European consumers better conditions than Gazprom, which would eventually lead to Europe stimulating the construction of new lines of the SGC, creating a real threat to Gazprom’s share in supplies to Europe.

“The costs of the Southern Gas Corridor are higher than those of Gazprom. The construction of new branches depends on the availability and cost of gas, and unlike Gazprom, there are problems with this,” Kulagin told NG.

The Southern Gas Corridor will not be able to become a limiter for Gazprom’s export supplies, the expert believes. “This project was taken into account in the plans. Yes, it will partly compete with Russian gas, like other supplies. But this was all expected. The project will partially compensate for the decline in domestic production in Europe and the increase in demand in individual countries, but the niche for Russian gas remains large,” says Kulagin.

El Murid is itching to write five posts a day about how bad Russia is. We have to repeat ourselves. There are not many events that can be interpreted as Putin’s fault.
That is the failure of some kind of “northern strategy” of Putin, although if Afrin is given to Putin, then even this strategy invented by El-Murid will end in victory. The fact that Putin did not achieve the non-partition of Syria, any of the Syrian participants of the United States, Turkey, Iran, says that Syria will remain united. These are some gas corridors that Putin did not achieve. But Gazprom has already built almost 900 km of the Turkish Stream gas pipeline in total along two lines. And here is a new feature, or rather a bearded one from the time of Nabucco. El-Murid threatens the Southern Gas Corridor.

Oddly enough, Turkmenistan is in the most difficult situation. Hundreds and thousands of Turkmens are fleeing to Afghanistan, driven to complete despair by the despotic regime in their country. In Turkmenistan, contradictions are growing between the leading five tribal associations, and the situation of the population is completely intolerable. The army is unreliable to the point that soldiers are simply not issued weapons. On the Afghan side, in the province of Jowzjan, there is a concentration of ISIS militants, and to a large extent - Turkmens. In the event of “Drang Nah Turkmenistan” from Afghanistan, predicting the outcome of the attack is more than problematic: the militants may be greeted, if not with flowers, then certainly with joy

But there you can think about who to sell the future 180 billion m³ of gas per year. Nothing personal, just business. Then Russia will have to save this fraternal people. Well, this hard work will have to be paid for with Turkmen gas, if at least something remains intact. Moreover, there will be neither Turks nor Americans there. Unless Iranian proxies will help. All their own, so to speak)).
By the way, ISIS is a great tool for joining Northern Kazakhstan, and Russia’s seizure of oil fields in Kashagan and gas fields in Ilotan. And all this action is in our backyard, where no one can interfere. You can re-cut Central Asia into countries.

So, from the Central Asian countries Uzbekistan and Kazakhstan, they are exporting to China. Turkmenistan, if the war in Afghanistan continues, will go bankrupt. Not a single cubic meter will reach Europe. Azerbaijan's gas exports of 10 billion m³ are completely absorbed by Turkey and Iran. Moreover, he doesn’t even have enough to fulfill contracts on Iran. On November 22, 2017, Azerbaijan resumed purchases of natural gas from Russia.

Who will fill the $45 billion Southern Gas Corridor? That's right, Russia. Moreover, Russia does not need to build anything. Everything will be built by the EU

Following the third energy package of the European Union. Russia can fill at least half of the pipe))). There is no one else. Even if Iran exports through the SGC, it will only be able to fill half of the pipe under the third energy package. But it’s not just the United States that is against Iran, even the EU is against it, and despite allied interests, Russia is also against it.
No one can now fill the Southern Gas Corridor except Russia.

Moreover, apparently the EU is building this bypass route for Ukraine, in Russian purposes. Russian diplomacy. With the southern gas corridor, even 2 additional Turkish flow pipes are not needed. The Southern Gas Corridor initially joins the Russian gas system. Relations with Georgia damaged on 08.08.08 have already been restored Russian diplomacy.

Well, if, as part of the continuation of TANAP, the Trans-Adriatic Gas Pipeline is built, with the expansion of the SGC, then and only then will 2 more Turkish Stream pipes be needed. Because there is nothing and no one to fill out the TAP except Russia. Azerbaijan will not have enough gas even with the completion of the first stage of the Southern Gas Corridor; it is already buying gas from Russia

This is why the Turkish Stream for Turkey means that it itself voluntarily gives up its interests to Russia in Central Asia, reorienting the former republics of the Union exporting their gas to Europe towards it. Naturally, in light of even these two factors, the Turks view the Turkish Stream as an extremely annoying obstacle, although they are not averse to taking advantage of the bonus in the form of one of its pipes to their domestic market.

The most surprising thing is that none of the Vlasovites see that the European Union is building a network of gas pipelines with its own money in order to supply Russian gas there. There is no Turkish participation there. Harm to Russia can only be caused by Turkmenistan’s access to these pipes. But consistent Russian politics a reduction in gas exports from this country will most likely lead to a social explosion. Russia does not need another gas rival. Neither the United States nor Iran needs it. But there are no other players there. No one will allow the Trans-Caspian gas pipeline to be realized. Yes, and he is not needed. There is a gas pipeline around the Caspian Sea. It will be necessary to release the volumes if Turkmenistan is ours.

The formation of a Turkish-American military alliance in Syria creates good preconditions for the transportation of hydrocarbons through the occupied territories from the Arabian Peninsula to Turkey and further to Europe: “This makes the Turkish Stream gas pipeline almost unnecessary, in which the Russian Federation is interested and which has become one of the unspoken motives for the introduction Russian group to Syria"...

Again, twenty-five. The Vlasovites still can’t get the Qatari version of the gas pipeline through Syria out of their heads. At least look at the map. And they thought about how they would build a gas pipeline from the Arabian Peninsula to Turkey, bypassing the territories of Assad and Shiite Iraq. Through Shiite Iraq, Iran is blocking. Russia is blocking through Assad. At the same time, the Kurdish-American right bank of the Euphrates is blocking the Iranian version of the gas pipeline. In Dominoes, this is called a "fish". Where Russia wins.
Moreover, the essence of the gas pipeline, whether the Qatari version or the Iranian version, is not to stretch it through Turkey, so as not to become dependent on it. And through Syria to the ports Mediterranean Sea and liquefy it there. But all options are blocked.
It would be necessary to build a gas pipeline to Turkey, so Iran would run it across its territory, and Qatar would connect. He would not need any Syria. But geographic cretinism does not allow Vlasov’s dreamers to even think. The only one who is not afraid to depend on the Turks is the EU and Russia. They have gas flow alternatives.

The plans of the SGC are grandiose and majestic, but in practice they are not able to cancel the dominance of Russian gas in Europe

Alexander Zapolskis

In the abundance of gas pipeline projects in Central Asia and Transcaucasia today can be confusing. There is a certain TAP - Trans-Caspian gas pipeline, running from the gas fields of Turkmenistan along the bottom of the Caspian Sea to the Sangachal terminal of Azerbaijan. There is a South Caucasus gas pipeline from Baku, through Georgia, to Turkey.

Then there is TANAP - the Trans Anatolian Natural Gas Pipeline, which runs across Turkey to its border with Europe, where it becomes the start of two other gas pipelines - NABUCCO through Bulgaria and again TAP (Trans Adriatic Pipeline) through Greece, Albania and the Adriatic Sea to the Italian city of Brindisi. Different volume figures are flashing everywhere, different terms launches and even different degrees of readiness.

For a long time, all of the above resembled an attempt to divide the skin of an unkilled bear. At the heart of everything was the Azerbaijani Shah Deniz field, gas from which Baku wanted to sell directly to Europe, without Russian mediation. The interest of other countries was clear. Firstly, Georgia saw in the project an opportunity to obtain energy resources “not from Gazprom” (which promised to gain “energy independence”).

Secondly, the transit pipe to Turkey meant transit payments, to put it mildly, not unnecessary for the economy. However, the Turks viewed the issue in a similar way. Some of the gas goes to us, and some goes on for sale to the European Union. And not only them. The Greeks and Albanians looked at the “Azerbaijani pipe” in exactly the same way. And all together it was called the Southern Gas Corridor.

The other day it was even officially launched. On May 29, in Baku, the President of Azerbaijan attended the ceremony for the start of gas injection into the South Caucasus Pipe (also known as Baku-Tbilisi-Erzurum, BTE). As stated, approximately by June 12 of this year, the process of technological preparation will be completed and the first Azerbaijani gas will begin to flow into TANAP.

Thus, the Southern Gas Corridor, which bypasses Russia, will finally start operating, which means that the efforts of a pool of “small countries” to overcome the Russian gas monopoly and gain their geopolitical subjectivity have been crowned with success. The export of energy resources via a route not controlled by Moscow promises opportunities to expand independence in foreign policy. In theory. The reality, as always, turns out to be much more complicated.

Azerbaijan still does not have the 25 billion cubic meters of BTE pumping volume per year announced at the end of 2017. And the site itself allows only 18.6 billion cubic meters to pass through. It will be increased to its maximum only in 2020. And even then, it’s unlikely.

For the entire 2017, with all the investments in the development of the Shah Deniz field, Azerbaijan managed to produce only 10.2 billion cubic meters of gas, of which it is able to export no more than 9 billion. While for loading TANAP, combined with the desire to supply also at least 10 billion cubic meters to Europe, Baku needs to have an export capacity of at least 27-32 billion cubic meters. In the best case, it will be possible to reach the 18 billion mark no earlier than 2020-2022.

It follows from this that for the next five years, Azerbaijani gas will only be enough to meet Turkish demand. To some, this result may seem successful. In the sense that not so much for Baku, but for Ankara, which is weakening its dependence on Gazprom. But the numbers tell a different story. Of the 50 billion cubic meters of its consumption, 24-25 billion are supplied by Russia. Iran gives another 10 billion. The Turks buy the rest wherever they can. It was the presence of a serious gas shortage that served as the basis for agreeing to the implementation of the first line of the Turkish Stream, after the completion of which an additional 15.75 billion cubic meters of blue fuel per year will come from Russia.

But the Turks don’t like that their gas dependence on Russia will reach 80%, which will put everything under Moscow’s control further development Turkish industry, which is always based primarily on energy. And this is where things start to get interesting.

According to statements from the Turkish side, they do not expect to receive more than 6 billion cubic meters per year from Azerbaijan until at least the end of 2022-2023. Despite the fact that we would like at least 10, and preferably 11 billion. But they are not there, which means there is absolutely nothing to pump through Greece, Albania and the Adriatic, and all statements by the Italians about the environmental threat are simply political PR. However, it is still theoretically possible to find gas at TAP, but it will never appear at NABUCCO. Unless, of course, we consider the second branch of the Turkish Stream as a source, the construction of which Turkey also gave permission for. But these additional 15.75 billion cubic meters of “Russian gas” completely cancel the basis of the concept of the Southern Gas Corridor as an important alternative line for importing energy resources to the EU, bypassing the Russian Federation.

Realizing that, despite all the rejection of reality, there is no other alternative, a number of oil and gas TNCs are trying to “find” the missing gas on the other side of the Caspian Sea - in Turkmenistan. Formally, any project there is impossible until the final demarcation of the water area, the process of which is underway, but is still far from completion. In practice, Western lawyers think that they have found a “gap” that allows them to begin designing a joint Azerbaijani-Turkmen project to lay the Trans-Caspian gas pipeline. Georgia has secured the support of the European Commission and expressed its readiness to finance the start of project work.

Turkmenistan's interest in “joining” the SGC is simple. In 2016, Russia stopped purchasing Turkmen gas, and at the beginning of 2017, Turkmenistan quarreled with Iran, as a result of which it lost exports there. As a result, the country is capable of producing 75-80 billion cubic meters of gas per year, but sells only 29.6 billion to the only buyer - China, which takes advantage of Ashgabat's desperate situation and pays little - only $ 185 per thousand cubic meters. The drop in export earnings has hit the country's income hard and forced the Turkmen government to significantly cut social guarantees. The incoming money is only enough to service loans received from China.

The implementation of TAP will make it possible to direct the “available surplus” through the Southern Corridor “to the West.” They are preparing to go 12-15 billion on the first line, then another 15-16 billion on the second. The project is actively supported by EU banks and that part of the European elite that actively does not like the forced rapprochement of the European Union with Russia.

Theoretically, Turkmen gas can provide both the additional load of TANAP and the needs of the Trans-Adriatic part of the SGC. In the future, even oust Gazprom. And if you look very far and take into account the very, very long-term plans (today rather just dreams, although not without reasonable grounds) of Turkmenistan to double its production with Western help, Europe can really get through the Southern Corridor (taking into account its expansion) to about 90 billion cubic meters of gas, which is approximately 70-75% of Gazprom's current supplies to the EU. In theory.

Because in practice, for the next five years, 6 billion cubic meters is all that can pass through the SGC from Turkmenistan. Consequently, they will not reach the European border of Turkey at all. At the same time, in the next three to four years, Nord Stream 2 and South Stream 2 will be commissioned, which will increase Russian gas exports to Europe from 155.9 (data for 2017) to 226-227 billion cubic meters per year.

Against this background, even if Azerbaijan manages to increase production to at least 18 billion, and Turkmenistan manages to miraculously extend the first line along the bottom of the Caspian Sea, then even in this case, at most 22-24 billion cubic meters will reach Europe, which will amount to at most 10% of Russian volumes. They will certainly bring additional money to suppliers, but they will not be able to have any serious impact on the overall balance of supply and demand in the European gas market, especially given the decline in European production. There is no alternative to the dominance of Russian gas in Europe.

The Southern Gas Corridor, which will be an alternative to Russian gas supplies to Europe, will be partially launched next year. European experts, however, doubt the feasibility of the project both in terms of gas supplies and financial costs, which are half provided by EU banks.

The Trans-Anatolian Gas Pipeline (TANAP), which is the longest section of the Southern Gas Corridor, will be launched early next year. The general manager of the project stated this to the Turkish Daily Sabah Saltuk Duzyol. According to him, in June 2018, Turkey will begin to receive gas from Azerbaijan through the pipeline. A year later, in mid-2019, construction of the Trans-Adriatic Pipeline (TAP) to Greece and Italy will be completed and gas supplies to the EU will begin in March 2020.

"Southern Gas Corridor". Photo: tap-ag.com.

According to Saltuk Duzyol, the cost of TANAP was reduced to $7.9 billion and the 1,350-kilometer highway through Turkey has already been built by 93%.

“We are now awaiting approval of a $1.3 billion loan from the European Investment Bank,” said the general manager of TANAP. In total, the project attracts $3.95 billion in loans. The main lenders are European banks. The European Investment Bank is a state financial and credit institution European Union. From 2020, EU consumers should receive 10 billion cubic meters annually from Azerbaijan and Brussels actively supports the project, considering the Southern Gas Corridor an alternative to Russian gas supplies. Today, 10 billion cubic meters is 2.5% of gas consumption in the EU, and European experts are not sure that the project will really be able to reduce Europe’s dependence on Gazprom and is worth the money invested in it.

Lead Analyst at the Oxford Institute for Energy Studies Simon Pirani told Climate Home News that dreams of additional gas volumes through the pipeline are unlikely to come true.

“I have doubts about the significant volumes of additional gas that will be able to be supplied to the Southern Gas Corridor, because it is unclear from which field in the Caspian Sea they will come from,” said Simon Pirani. - There is a field being developed by the state-owned company SOCAR together with Total, but it will not be able to produce significant volumes of gas and both companies have already agreed to supply the produced gas to the domestic market. But there are no other fields for gas production for export. Therefore, the amount that Azerbaijan can give to Europe in reality is quite small.”

Europe hopes for diversified sources of supply through the gas pipeline, however, according to a leading analyst at the Oxford Institute, these hopes are unlikely to come true: “Turkmenistan is more interested in exporting to China, and in northwestern Iran there are not sufficient volumes of gas to supply to Europe.”

Another unpleasant news for the planned expansion of the Southern Gas Corridor may be reports that one of the largest LNG traders, Shell, is negotiating to purchase 5 billion cubic meters of gas annually from the Israeli Leviathan field for liquefaction in Egypt. Offshore fields in Israel, as is known, are also considered as an additional source of gas supplies to the Southern Gas Corridor. Instead of Israeli gas, there may be gas from Iraqi Kurdistan. However, we wrote that this project with the participation of Rosneft now has too many political risks.

Climate Home News noted that the cost of the Southern Gas Corridor (estimated at $45 billion) is comparable to all EU investments in the transition to clean energy in 2014-2020. In addition, the publication recalled the scandal of money laundering by Azerbaijan and bribery of European politicians. Thus, member of the board of the European Bank for Reconstruction and Development (EBRD) from Bulgaria Kalin Mitrev received $500 thousand from Baku, and the EBRD is a lender to the Southern Gas Corridor. Kalin Mitrev himself stated that he received money for consulting services.

Earlier, Deputy Chairman of the Board of Gazprom Alexander Medvedev said that Azerbaijan does not have enough gas, as it is forced to pump it back into the fields to support oil production. This is also why Gazprom and the state-owned company Socar were negotiating to increase Russian gas supplies to Azerbaijan. Now the Russian holding has a contract for the supply of up to 2 billion cubic meters of gas per year. Socar is interested in increasing the volume by another 3-5 billion.

Another indication that even with the planned supplies along the Southern Gas Corridor, not everything is so smooth, may be the statement of the head of the Turkish Foreign Ministry. Last year Mevlut Cavusoglu said that the first line of the Turkish Stream gas pipeline will supply 16 billion cubic meters annually, and the surplus - what is not in demand by Turkey - will go to TANAP.

“I believe that even 10 billion from Azerbaijan is not guaranteed to Europe in the foreseeable future,” says the deputy director of the National Energy Security Fund (NESF) Alexey Grivach. - The deep-water part of the Shah Deniz-2 field, which is planned as resource base for the Southern Corridor, a very difficult project in terms of technology, geology and climatic conditions. Therefore, Azerbaijan may be very interested in receiving insurance from Russia in order to avoid penalties for incomplete or untimely fulfillment of obligations.”

Follow us