Gazprom, Ankara Agree Onshore Turk Stream Finance
Gazprom has reached an agreement with Ankara on the procedure for financing construction of the section onshore Turkey of the Turk Stream gas pipeline, according to Turkish state pipeline company Botas CEO, Burhan Ozcan, on the margins of the 22nd World Petroleum Congress.
"We have already agreed with them on this issue. However, I cannot disclose the figures - in what percentage we will do it," he said July 11 in Istanbul.
Ozcan stressed that negotiations on obtaining permits for Turk Stream's second line, which will supply gas to Turkey itself, continue in a "positive way".
The Botas chief also said the gas pipeline will come ashore in the European part of Turkey at Kiyikoy district in Thrace: "Despite various rumors, there are no changes [to the route].”
Gazprom began laying Turk Stream's offshore section on May 7. Russian energy minister Alexander Novak said this week in Istanbul that some 50km have already been laid on the Black Sea bed.
Gazprom deputy chairman Andrei Kruglov said last month that Gazprom's investment in building Turk Stream’s offshore section is $6bn. However the IEA’s World Energy Investment report, published July 11, has estimated the full cost of the 31.5bn m3/yr Turkstream twin pipe system at $15bn.
Russian business newspaper Vedemosti meanwhile has reported that the prospectus for issuance of Gazprom eurobonds has stated the risk that US sanctions could halt Turk Stream.
If the current version of the bill on new US sanctions against Russia comes into force, it can delay and even "prevent the completion of projects by the group," the prospectus said, listing Nord Stream-2 as well as Turk Stream among projects at risk of being blocked.
The US sanctions bill was approved by the Senate June 15 and sent to the US House of Representatives which will review the document after July 10.
The bill provides for the right of the US President to impose sanctions on individuals and companies that have invested in the construction of export pipelines by Russia from $1mn once, or more than $5mn in a year. It is forbidden to provide equipment, technologies and services for such projects.
Azerbaijan Desk