Bloomberg News

ITGI Pipeline Is ‘Strategically Important,’ Minister Says

March 02, 2012

Greece and Italy still consider the Interconnector Turkey-Greece-Italy pipeline project for transporting Caspian Sea gas to Europe “strategically important,” Greek Environment, Energy and Climate Change Minister George Papaconstantinou said.

The BP Plc (BP)-led group of companies developing the second phase of the Shah Deniz field in Azerbaijan on Feb. 20 ruled out using ITGI to transfer gas to the European Union. The venture also comprises State Oil Company of Azerbaijan, Statoil ASA (STL), Total SA (FP), OAO Lukoil, Naftiran Intertrade and Turkiye Petrolleri AO.

“We continue to believe that ITGI is the most mature of the pipeline projects,” Papaconstantinou said in a Feb. 29 interview in Athens. “We’re willing to continue discussing with the Shah consortium potential solutions that take advantage of this maturity and that come closer to the venture’s concerns about commercial issues as well as ITGI’s shareholding structure.”

ITGI is a venture of Greek natural gas supplier Depa SA and Italy’s Edison SpA. (EDN) BP said Feb. 22 that the Shah Deniz group will choose between the OMV AG-led Nabucco project and the BP- proposed South-East Europe Pipeline, or SEEP, by the middle of this year.

The winner will then compete with the Trans-Adriatic Pipeline, known as TAP, for the rights to carry gas into the EU via its southeastern borders, the so-called Southern Corridor route. The venture will then make its final choice by mid-2013. Statoil owns a 42.5 percent state in TAP.

Northern Spur

While ITGI and TAP both plan to link Greece with Italy, the TAP venture will also cross Albania. The ITGI project foresees a northern spur pipeline between Greece and EU neighbor Bulgaria.

In addition to the EU sourcing Russian and Azeri gas, “there will increasingly be Israeli, Cypriot and possibly Greek gas,” Papaconstantinou said. Israel and Cyprus have discovered reserves of offshore gas in the past two years estimated to be worth billions of dollars in exports. Greece has invited investors to bid to explore for oil and gas in both off- and onshore areas.

“It’s clear for Greece and Italy that a route going through these two countries to Europe that connects to the Azeri side, to the south and possibly to the north, is extremely important for strategic reasons and we will continue to do whatever it takes to keep that route on the map of future gas routes,” Papaconstantinou said.

To contact the reporter on this story: Paul Tugwell in Athens at ptugwell1@bloomberg.net

To contact the editor responsible for this story: Jerrold Colten at jcolten@bloomberg.net;


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