TANAP deal maybe signed next week

Azerbaijan and Turkey are set to sign an agreement to move forward with the Turkish part of the South Caucasus gas pipeline, the Azerbaijani Energy Minister Natik Aliyev said Tuesday in Kuwait.

The project is key to alleviating Europe's dependency on Russia's natural gas, Wall Street Journal reported.

The greenlight would also be good news for U.K. oil giant BP PLC (BP), which has key role in developing an offshore gas field in Azerbaijan that will supply Europe via Turkey.

Aliyev said he expects the intergovernmental agreement to be signed next week between Turkey and Azerbaijan for the Turkish part, called the TransAnatolian pipeline.

Earlier, Azerbaijan and Turkey signed a memorandum of understanding to establish the consortium that will build the Trans Anadolu Pipeline (TANAP) for supply of gas from Shah Deniz gas field to Europe through Turkey.

The parties involved in the project intend to resolve all issues on this gas pipeline in 2012. They also plan to commence construction immediately in order to complete it by late 2017.

The second stage of development of the Azerbaijani Shah Deniz gas condensate field will be launched by late 2017. Gas reserves of this field are estimated at 1.2 trillion cubic meters.

The initial capacity of the pipeline will be 16 billion cubic meters. Some 6 billion cubic meters of the volume will be allocated to Turkey, while the rest will be transported to Europe.

The contract to develop Shah Deniz was signed June 4, 1996. Participants are BP (operator) - 25.5 percent, Statoil - 25.5 percent, NICO - 10 percent, Total - 10 percent, Lukoil - 10 percent, TPAO - 9 percent, and SOCAR - 10 percent.


/Trend/