Trans Adriatic Gas Pipeline to be built by EGL and StatoilHydro adds to EU’s energy diversification.

Following up on an earlier post (29 Jan), Turkish Energy is considering being involved in the equally-owned joint venture between Swiss company EGL and Norway’s StatoilHydro in building the Trans Adriatic Pipeline (TAP). The project will be additional to the Turkey-Greece-Italy Pipeline (TGI) and the Nabucco Pipeline.

Turkish Energy and Natural Resources Minister Hilmi Guler was reported by the Associated Press as saying on Wednesday that, “this pipeline will carry Iranian natural gas to Thessolonika (via Turkey) and then to Albania, and it will pass over the Adriatic Sea to Italy.” Cold weather had stopped gas shipments from Iran again on Friday. Guler said such cuts would not occur if the new gas pipeline was constructed between the two countries. Iran is Turkey’s second-largest supplier of natural gas after Russia.

The pipeline will open a new corridor and market outlet for natural gas from the Caspian Sea and Middle East regions into Europe. In a press release, StatoilHydro describes the project as a 520 kilometre long pipeline that in its upstream part will interconnect with Greece’s existing pipeline system that is linked further to the east with systems in Turkey. Implementation is subject to a final decision planned for the second half of 2009. TAP is in the front-end engineering stage. The feasibility study was concluded by EGL in March 2006, the extended basic engineering and environmental impact Assessment was conducted in March 2007, and included the offshore survey for the pipeline which was carried out in 2006. EGL estimates the cost to be 1.5 billion euros depending on steel prices and other pipeline equipment costs at time of construction. The TAP project is a “Priority Project” under the EU’s Trans-European Networks guidelines as it is aimed at diversification and security of gas supply.

All these gas pipeline projects will help increase diversification and market competition and thereby decrease Europe’s dependence on Russian natural gas. Russia’s ability to wield political and economic power using its dominance in natural gas was highlighted this week with Russia once again threatening to cut of supplies to the Ukraine. An interesting article in the St. Petersburg Times looks at Europe’s need for energy security and “the EU’s lack of resolve to challenge Russia’s monopolistic pressure.” Turkey continues to discuss energy cooperation with the Swiss also discussing nuclear energy, as it aims to increase its energy capacity to meet population growth in the future.

~ by abstraktbiblos on Thursday, 14 February, 2008.

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