Construction of $45bln strategic pipeline launched
May 17, 2016 Leave a comment
Greece has hosted a groundbreaking ceremony of the Trans-Adriatic Pipeline (TAP), which constitutes the European leg of the Southern Gas Corridor (SGC) pipeline network project that will transfer Azerbaijan’s natural gas to Europe.
The construction of the TAP pipeline will enable to enhance energy security of the EU and diversify supply routes of natural gas to the Central and South-eastern Europe.
The significance of TAP as a strategic piece of the Southern Gas Corridor infrastructure was underlined by the presence of the Prime Minister of Georgia Georgi Kvirikashvili, the First Deputy Prime Minister of Azerbaijan Yaqub Eyyubov, the Deputy Prime Minister of Albania Niko Peleshi, the EU Vice President for Energy Union Maroš Šefčovič, the US Special Envoy and Coordinator for International Energy Amos Hochstein, the Minister of Energy of Turkey Berat Albayrak, the Minister of Economic Development of Italy Carlo Calenda, the Minister of Energy of Bulgaria Temenuzhka Petkova, as well as the Switzerland State Secretary Federal Office of Energy Walter Steinmann.
The SGC will play a vital role in achieving Energy Union’s target on diversification of energy resources, routes and energy security, said Maros Sefcovic, Vice-president of the European Commission for Energy Union.
Azerbaijan, an initiator of the giant Southern Gas Corridor project, has become very important energy player at the regional and global level, he added.
TAP, which is a part of the largest Southern Gas Corridor project, envisages transportation of gas from the Stage 2 of development of Azerbaijan’s Shah Deniz gas and condensate field to the EU countries. The project aims at providing European countries with alternative source and route of gas supplies, promoting energy security of Europe.
TAP is a project of geo-strategic importance for the entire region, Alexis Tsipras, Greek prime minister, said at the groundbreaking ceremony.
“The beginning of construction for the TAP pipeline is taking place at a pivotal time for the Greek economy and our wider region,” he added.
Ian Bradshaw, Managing Director at TAP AG, in turn, stated that the TAP pipeline will continue to progress safe transportation route for the Caspian gas to Europe, emphasizing that the company remains committed to deliver the project safely, on schedule and on budget.
Bradshaw further added that TAP will continue to promote job creation, and the project’s implementation will inject billion euros of foreign direct investments.
TAP will stretch 870 kilometers across Greece, Albania, the Adriatic Sea and the southern part of Italy. The pipelines initial capacity will be 10 billion cubic meters, expandable to 20 billion cubic meters in future. The first gas delivery to Europe via TAP pipeline is expected in 2020.
Worth noting, the consortium of Azerbaijani Shah Deniz field development selected the TAP project over the Nabucco West as the route to transport its gas to Europe in June 2013.
The contracts on the purchase of Azerbaijani gas from the second phase of Shah Deniz field development (Shah Deniz-2 project) were signed Sept. 19, 2013 with Shell, Bulgar gas, Gas Natural Fenosa, E.ON, Gaz de France, Hera, Enel, Axpo, DEPA.
At the beginning of March 2016, the European Commission approved the agreement between the Greek government and the Consortium on TAP’s construction. TAP is included to the list of the European Commission’s common interest projects.
The shareholders of the project are BP (20 percent), SOCAR (20 percent), Snam S.p.A (20 percent), Fluxys (19 percent), Enagas (16 percent) and Axpo (5 percent).
The Consortium on TAP’s development expects to receive funding from a number of international institutions including the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), as well as, export credit agencies of several countries of the Organization for Economic Cooperation and Development (OECD).
The SGC, a win-win project for all parties, is one of the biggest construction projects of our times with a value of $45 billion.