Nabucco's future depends on Turkmenistan
09.03.2010 (16:08) | Kommersant
If it fails to come to an agreement with the EU within six months, the EU will spend the money on other energy projects.- - - - - - - - - - - - - - - - - - - -
The European Commission has approved a 2.3-billion euro economic stimulus program with the largest-ever package of grants for energy infrastructure, including 200 million euros for the Nabucco pipeline project to bring gas from the Caspian Sea to the European Union.
The 2,000-mile pipeline, with an estimated total cost of 8 billion euros ($10.8 billion), should help reduce the EU's reliance on natural gas from Russia. However, allocations have been suspended until the final investment decision is taken on the project.
Nabucco's future now depends on Turkmenistan. If it fails to come to an agreement with the EU within six months, the EU will spend the money on other energy projects.
In spring 2008, Turkmenistan signed a memorandum on the annual delivery of 100 billion cubic meters (3.53 trillion cubic feet) of natural gas to Europe. The European Parliament made unprecedented political concessions by ratifying a trade agreement with Turkmenistan despite the country's deplorable record in human rights. However, that effort has not moved the Nabucco project forward.
The absence of any agreement on the Caspian Sea delimitation between Azerbaijan and Turkmenistan hinders the Trans-Caspian pipeline project, which would supply Turkmen gas to Nabucco. Turkmenistan's Caspian coast is only 200 km (124 miles) away from Azerbaijan's gas transportation system, which is connected to Turkey by the South Caucasus pipeline. But Turkmenistan and Azerbaijan remain unable to solve their territorial dispute.
Turkmenistan is ready to deliver gas to Europe via Iran or Russia bypassing Azerbaijan, according to a government source. One possible route is a new pipeline from the Dovletabad field to Iran with a throughput capacity of 12 billion tons per year (241.64 million bpd). But the United States is unlikely to support this idea; its desire to isolate Iran has in fact deprived Nabucco of much needed gas resources.
The Nabucco project is also suffering from internal problems. For example, Azerbaijan, unable to come to an agreement with Turkey on gas supply and transit terms, has declared its willingness to export its gas to Russia and Iran.
Azerbaijani officials are openly skeptical about Nabucco, and Bulgarian politicians support their view. The project organizers' hope of getting gas from Azerbaijan or Iraq has so far not been formalized. In short, Nabucco still has no resource base.
Last Thursday, the Turkish parliament approved a bill on the construction of the Nabucco pipeline, but the same day the U.S. House of Representatives Foreign Affairs Committee passed a nonbinding resolution calling the World War I-era killing of Armenians genocide.
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