TODAY.AZ / Business

Azerbaijan eyes no change to gas supply contracts with Turkey

26 April 2014 [11:07] - TODAY.AZ
There are no negotiations regarding the refusal from the "take or pay" principle used for payments for gas supplied from Azerbaijan to Turkey, SOCAR head Rovnag Abdullayev told media on April 23.

"The Turkish side is discussing this with Russia and Iran," he added. "But the issue was not raised with the Azerbaijani side."

Ankara intends to deviate from a "take or pay" principle while executing the contracts on gas supplies from Azerbaijan and Iran, Turkish Minister of Energy and Natural Resources Taner Yildiz said earlier.

"Turkey will refuse from a "take or pay" principle in the contracts with Iran in 2014, and with Azerbaijan - in 2015," he said.

"Therefore, Azerbaijan and Iran must ensure gas supplies to Turkey in sufficient volumes," he added. "In case of supplying insufficient volumes, they will not be included in this mechanism [take or pay]."

A contract for the supply of Azerbaijani gas as part of the first stage of developing the Shah Deniz gas condensate field was signed on May 12, 2001 for 15 years, according to a statement posted on the website of the Turkish state pipeline company Botas.

The contract envisages the annual supply of 6.6 billion cubic meters of gas. Azerbaijan and Turkey also have the second contract, which envisages the supply of gas as part of the second phase of developing the "Shah Deniz" field. It envisages supplying six billion cubic meters of gas annually. The contract was signed on October 25, 2011 for 33 years. It is expected to begin supplying in 2017-2018.

Turkey and Iran signed a contract for the annual supply of 10 billion cubic meters of gas on August 8, 1996. The contract duration is 25 years.


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