The intergovernmental agreement signed between the Trans Adriatic Pipeline's (TAP) host countries has been assessed as a step forward in the realization of the project, which will open a potential route for transporting Azerbaijani gas to Europe as part of the EU-backed Southern Corridor of pipelines.
The document was signed by Greece's Foreign Minister Dimitris Avramopoulos, Albanian Deputy Prime Minister Edmond Haxhinasto and Italian Minister of Economic Development Corrado Passera in Athens on Wednesday.
TAP Managing Director Kjetil Tungland stated that the Intergovernmental Agreement lays a solid foundation and provides long-term security that is required to move the project forward towards selection -- as a route for gas supplies to Europe -- and construction.
"We now look ahead to continuing our fruitful cooperation in making the TAP project a reality," Tungland said in a statement following the signing of the agreement between the governments of Greece, Italy and Albania.
Furthermore, TAP's External Affairs Director Michael Hoffmann said the signing of the intergovernmental agreement further reinforces the host governments' support for TAP from a legal and regulatory perspective.
"For TAP, this concludes the last remaining high level international political agreement, which is important for the upcoming selection process by the Shah Deniz Consortium," Hoffmann said.
TAP is one of the two options -- along with Nabucco West -- which is currently considered by the consortium developing Azerbaijan's giant offshore Shah Deniz field to deliver its gas to European markets.
Azerbaijan plans to export 10 billion cubic meters of gas a year to Europe within the second stage of the Shah Deniz development.
TAP project is designed to transport gas from the Caspian region via Greece and Albania and across the Adriatic Sea to southern Italy and further into western Europe. Gas to be produced within the second phase of Shah Deniz gas condensate field development is considered as the main source for TAP.
TAP pipeline's initial capacity will be 10 billion cubic meters per year, but is easily expandable to 20 billion cubic meters. TAP's shareholders are AXPO of Switzerland (42.5 percent), Norway's Statoil (42.5 percent) and E.ON Ruhrgas of Germany (15 percent).
In case TAP is selected as a final pipeline route to transport Azerbaijani gas to Europe, the construction of the pipeline will start in 2015.
Nabucco West is a short-cut version of the Nabucco project, which envisages construction of a pipeline from the Turkish-Bulgarian border to Austria.
On Wednesday SOCAR Vice-President Elshad Nasirov said that the Shah Deniz consortium will make its final decision on the pipeline route in June.
"The decision on supplying Azerbaijani gas to the Austrian Baumgarten or Italian Pula, that is choosing Nabucco West or TAP, will be made in June," Nasirov said.
He said that the final investment decision on the Shah Deniz project will be made by October this year. Production of the necessary volumes of gas and its supply to the pipeline is to begin in 2018 and deliveries to Europe in 2019.