TAP Construction Costs Fall by 25%

The cost of the Trans-Adriatic pipeline (TAP) construction project will be €4.5bn, the consortium's managing director Ian Bradshaw in an interview with Turkish news agency Anadolu. Previously, its cost was estimated at €6bn.

“Until now, we did not name an exact figure on the cost of TAP project for the award of contracts. However, we can now state that the TAP pipeline will cost €4.5bn. This amount also includes the design and engineering work on the project ongoing since 2009,” said Bradshaw.

Construction of compressor stations will begin in 1Q2017 and construction of the offshore part of the pipeline will follow in 2018-2019, he said.

Ian Bradshaw has been TAP managing director since February 2015 (Photo credit: TAP)

Bradshaw also said that the consortium Shah-Deniz is planning to sell the first gas in phase 2 in the Turkish market in late 2018. Deliveries of the first gas from the field to Europe via TAP will begin at the beginning of 2020.

“With regard to financial issues, in 2017 we will update the schedule of financing TAP. We expect that the supply of goods and services for the project will be financed by the European Bank for Reconstruction and Development, European Investment Bank and a number of export credit agencies of the Organisation of Economic Cooperation and Development,” he stressed.

TAP's total length is 878 km, of which 550km is across northern Greece, 215km in Albania, 105 km subsea in the Adriatic and 8km in Italy. The pipe represents the westernmost extent of the Southern Gas Corridor stretching over 3,500km, including the Southern Caucasus Pipeline and Trans Anatolian Pipeline (Tanap).

TAP shareholders are: Azerbaijan's state Socar, BP and Italian gas grid Snam (each 20%), Belgian and Spanish gas grids Fluxys (19%) and Enagas (16%), and Swiss energy utility Axpo 5%.

Azerbaijan Desk