Bloomberg News

BP Says Shah Deniz to Choose Gas Pipeline to Europe in Mid-2013

February 22, 2012

Feb. 22 (Bloomberg) -- BP Plc and its partners in a Caspian Sea gas field plan to make a final decision on an export route to Europe by the middle of 2013.

The BP-led group developing Shah Deniz will choose between the European Union-backed Nabucco project and the South-East Europe Pipeline, or SEEP, by the middle of this year, Tamam Bayatli, a spokeswoman for the U.K. energy producer in the Azeri capital of Baku, said by phone today. BP proposed SEEP.

The winner will then compete with the Trans-Adriatic Pipeline, known as TAP, for rights to export Shah Deniz gas, Bayatli said. The partners aim to make the final choice before an investment decision on expanding Shah Deniz is due in mid-2013, she said.

Nabucco, led by Austria’s OMV AG, is vying for Azeri fuel with smaller projects as the EU seeks to diversify supplies away from Russia, which provides a quarter of its natural gas. The project may be reduced in length after Azerbaijan decided last year to build its own link to the Turkey-EU border.

“The less I have to invest to get it, the happier I am,” OMV Chief Executive Officer Gerhard Roiss said today. A shorter Nabucco, starting from Turkey, is “fine,” he said.

The Shah Deniz partners earlier this week eliminated a fourth contender, the Interconnector Turkey-Greece-Italy, or ITGI. Greek gas supplier Depa SA said yesterday it is committed to ITGI, which it’s developing with Italy’s Edison SpA.

Shah Deniz, which may hold 1.2 trillion cubic meters of gas, is being developed by BP, Statoil ASA, State Oil Co. of Azerbaijan, Total SA, OAO Lukoil, Naftiran Intertrade Co. and Turkiye Petrolleri AO.

Elshad Nassirov, the vice president of the Azeri state company known as Socar who is leading talks on the pipeline selection, confirmed by phone that the final pipeline selection will be made by the middle of next year.

--With assistance from Zoe Schneeweiss in Vienna. Editors: Tony Barrett, Torrey Clark

To contact the reporter on this story: Zulfugar Agayev in Baku at zagayev@bloomberg.net

To contact the editor responsible for this story: Hellmuth Tromm at htromm@bloomberg.net


Video Game Avenger
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus