2012 Frankfurt Gas Forum: Waiting Can Be Fun

Working as a freelance journalist, I write articles for several newspapers and magazines on various topics. But before writing, I have to do research, read other articles and interview relevant people. Very often, I have to go to an event or, even more often, to several ones. I may be a congress or something similar, dealing with the topic the article will be about.

It does not happen very often that one event provides all information necessary to be up to date. It is also unusual that an event is actually fun and gives me the chance to talk to all the relevant people at one single event. The 2012 Frankfurt Gas Forum on November 28, 2012, was such an event where, along with about 60 participants, I had all the key players at one place. In addition to listening to the speeches, I conducted interviews during the coffee breaks, at lunch time and before dinner.

The Forum dealt with the question, how the future Southern Gas Corridor will look like, i.e. on which route Caspian gas will be transmitted to Europe in the future. Will it be the Nabucco Pipeline, going from Turkey via Bulgaria, Romania and Hungary to Austria? Or will it be the Trans Adriatic Pipeline (TAP), leading from Turkey via Greece and Albania to Italy? Will the Caspian gas cross Turkey from east to west via the Trans Anatolian Pipeline (TANAP)?

The intention to get this gas into Europe is to meet the increasing demand there, and to become more independent from Russia, which has a share of 35 % at present. At the same time, the intention of Azerbaijan is to provide Caspian gas to additional customers.

So this seems to be a win-win-situation, and everyone is looking forward to October 2018, when the first gas will go to Europe hopefully. Nevertheless, several speakers also mentioned remaining risks, such as timing and economics, and having a concept that is completely different to former projects: Usually, it is the producer and not the customer who takes care of the transport.

So the quality of the speakers was amazing. For me, the most helpful input came from Ambassador Roland Kobia, Head of the Delegation of the EU to the Republic of Azerbaijan. From Reinhard Mitschek, Managing Director of Nabucco Gas Pipeline International, and from Kjetil Tungland, CEO of TAP. 

In addition to several analysts and strategists from Europe and Azerbaijan, there were some from TANAP, from the State Oil Company of the Republic of Azerbaijan (SOCAR) and from BP, the leader of the Shah Deniz consortium, which will decide on the route of the future pipeline in June next year.

Last but not least, there was Guenther Oettinger, Commissioner for Energy at the European Commission, who was the keynote speaker delivering quite a challenging speech. Like the other speakers, Oettinger assumed that it will be TANAP to bring the Caspian gas to the western border of Turkey.

But in the eyes of Oettinger, there should not be a decision on either Nabucco or TAP. Due to the increasing demand of gas in Europe, the Commissioner prefers to have both of these pipelines. Oettinger said that the initial amount of 10 bcma, will not be sufficient. Instead, Shah Deniz should deliver at least 30 bcma on the long run.

As said before, the quality of the speakers was amazing, and so was the quality of most of their speeches. However, there were no new arguments I had not heared before the Frankfurt Gas Forum. But, as John Roberts from Platts described it at the end of that day, the forum came right to the heart of the future Southern Gas Corridor.

The final decision by Shah Deniz partners will not be made before mid of next year. So somehow I felt like a child on Christmas Eve, waiting at the door until Mom and Dad would ring the little bell for gift giving to start. But, as in the past, waiting can be fun as well. Most of all, when there is something to expect that is worth waiting for.

Hubert K.