Azerbaijan Eyes Iranian Gas for TANAP
Azerbaijan's energy sector is considering the removal of sanctions against Iran to possibly increase th commercial viability and attractiveness of the Trans-Anatolian Natural Gas Pipeline Project (TANAP).
In the near future natural gas from these energy rich nations, holding the second-largest proven reserves in the world, could be sources for TANAP, head of the State-Owned Oil Company of Azerbaijan (SOCAR) said.
"TANAP is already a commercially very attractive project. After lifting sanctions against Iran, the relevance of TANAP will grow even more. For future gas export from Iran Trans Anatolian line would be the only option to deliver it into the world markets," Rovnag Abdullayev told to journalists last weekend.
Azerbaijan has decided to keep a major stake in the TANAP consortium and is interested in boosting gas volumes pumped through it to increase future outcomes.
The natural gas volumes from the Eastern Caspian nations, namely Turkmenistan, has been considered as a viable source for TANAP in the future with the expansion of its capacity.
According to Azeri Energy Minister Natik Aliyev, TANAP’s capacity will be increased in a few years to 23-24 billion cubic meters a year (bcm/a) from an initial 16 bcm/a with plans to expand even further to 31 bcm/a.
"TANAP’s capacity could even be expanded to 65 bcm/a if there are gas sources to pump through it,” he said.
However, it might take years before the idea to bringing Turkmen gas across Caspian to TANAP and further to Europe become real.
The changing situation vis-a-vis Iran with the success of the Lausanne agreements and expectations of lifting sanctions against Iran’s energy export have been reshaping the whole picture. It includes also an option to deliver Turkmen gas to Turkey for further export to EU via Iran.
The idea of attracting Iranian gas to TANAP was discussed even before reaching a framework agreement for Iran’s nuclear program.
Last year it was discussed with visiting high-ranked Iranian officials and at the meeting of the Azerbaijan-Iran bilateral economy commission that was held last August in Baku.
SOCAR’s head also did not rule out the possibility of selling some portion of the company’s stake in TANAP if it gets an “attractive offer,” adding that there are already such proposals.
SOCAR said earlier that it would keep at least 50 percent in TANAP. That means there is an option to sell some 8 percent from SOCAR’s current 58 percent interest in the pipeline project.
There are some talks for selling stakes in TANAP, an outcome that would be "surprising", said well-placed SOCAR sources.
The other sources suggested that Malaysia’s Petronas, which became a member of Shah Deniz consortium last year, could be a new partner for TANAP.
Petronas bought 15.5% interests from Norway’s Statoil however the transaction has not completed yet. The company has also offshore oil and gas development in a Turkmen part of Caspian, where it is planning to boost gas production.
After lifting sanctions against Iran it’s NICO that is a member for the Shah Deniz consortium could also join to the Southern gas corridor and TANAP. NICO has 10 percent interest in Shah Deniz.