Socar Expects Delay in EU Offtake (Correction)
Correction: the earlier report published here wrongly said that Socar forecasts gas deliveries to Europe to start 2H2020. This is corrected to mid-2020 in the version follows. The revised headline also indicates that any delay is not expected to be due to the SD2 supply consortium.
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Azerbaijan’s Shah Deniz stage 2 (SD2) gas deliveries to Europe are expected to start in mid-2020, the head of external relations of Socar Turkiye Enerji, Murad LeCompte, has told NGW.
Earlier in April, the TransAnatolian pipeline's general director Saltuk Duzyol had said the supply of Azerbaijani gas from Shah Deniz into the TransAdriatic pipeline (TAP) would begin late 2019 or early 2020 - although such dates were beginning to look over-optimistic. This is despite the gas purchase date having been set at 3Q2019 as per the gas purchase contract, when the latter was signed in 2013.
LeCompte didn’t mention the reason, but the Azerbaijani gas supply date to Europe seems to have been affected by procedures in Italy, where some of the local population has protested several times against construction of the pipeline, and several members of the new Italian government had opposed the implementation of this gas pipeline. The new government in Rome said last month it will review the project.
A source at the TAP consortium told NGW that there is no worry about the project: “Cancellation of TAP is not expected, because firstly it is vital for EU. Moreover, clients have signed 8bn m3/yr of take-or-pay gas purchase contracts lasting 25 years for the Italian market with the BP-led Shah Deniz consortium”.
LeCompte said that by the way, Tanap will be ready to deliver gas to TAP in mid-2019, but actual supply is projected from mid-2020.
Southern Gas Corridor Company CEO Afgan Isayev told NGW July 2 that Tanap is 94.8%-complete and the Trans Adriatic Pipeline (TAP) is 74.6%-complete. SGCC itself has invested $9.1bn to date in the entire project chain. Azerbaijan began gas deliveries to Turkey’s Eskishehir through Tanap on June 12, and the Shah Deniz phase 2 project began flowing gas through the pipeline June 30.