Baku Invites Kazakhstan to Join Trans - Anatolian Pipeline

Kazakhstan can surely take part in the construction of the Trans-Anatolian Pipeline (TANAP) that will transport Caspian natural gas to Europe, Ambassador of Azerbaijan in Astana Zakir Gashimov told New Europe in an interview.

Collaboration between two Caspian countries – Kazakhstan and Azerbaijan -has an unimproved potential, Gashimov said, addingthat the oil and gas sector could be the most promising in terms of enhancing cooperation. Both oil and gas producing former Soviet republics, located on the shores of the Caspian Sea could become a reliable supplier of natural gas to Europe.

In this respect, the Caspian region has always been regarded as one of the alternative energy suppliers to Europe.

For example, Kazakhstan can take part in such a large energy project as construction of a gas pipeline to Europe – Trans-Anatolian pipeline (TANAP), the Azeri ambassador said.

"Iran and Turkmenistan are intended to participate in the project of TANAP. The doors are also open for Kazakhstan,” Gashimov said.

TANAP was launched in Turkey in March of this year. This project involves construction of a system of gas pipelines from Azerbaijan’s Shah Deniz field through Georgia, Turkey, Greece, Albania to the south of Italy by 2019.

The initial capacity of the pipeline is expected to be 16 billion cubic metres of gas per year. About 6 billion cubic metres will be delivered to Turkey, and the rest will go to Europe. Turkey will get gas in 2018, and will go to Europe at the beginning of 2020 after the completion of construction of the Trans Adriatic Pipeline (TAP).

After completion of legal registration, the shareholders of TANAP will be as follows: Azeri state oil company SOCAR – 58%, Turkey’s Botas – 30%, BP – 12%.

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Regarding the participation of Iran and Turkmenistan in TANAP, for these countries this project is really interesting against the backdrop of the annual growth of gas production.

As known, Turkmenistan sells gas to Russia, Iran and China, that is why TANAP is a possibility for the official Ashgabat to diversify export of gas.

Turkmengas state concern and Turkish Atagas company signed a framework agreement on cooperation in natural gas purchase and sale in November 2014.

Turkmenistan’s joining the TANAP gas pipeline project initiated by Azerbaijan and Turkey can add economic feasibility to the project. Ankara and Baku will receive additional revenues from the transit, and Ashgabat, Teheran and Brussels will have the gas deal.

As for Kazakhstan’s participation in the project TANAP, Astana is keeping silence.

"This issue has never been discussed,” a representative of the Ministry of Energy of Kazakhstan told New Europe on condition of anonymity.

The representative explained that the former Soviet republic has very few export volumes at the moment. It is known that large amounts of gas are produced in Kazakhstan in Karachaganak.

Under the contract signed in October 2002 among Gazprom OJSC, Orenburggazprom LLC and Karachanak Petroleum Operating (KPO), a part of the produced gas is supplied for processing at the Orenburg gas processing plant in Russia. The annual volume of deliveries starting in October 2003 is 7 billion cubic metres of gas.

The remaining volumes of gas are injected back into the reservoir to maintain reservoir pressure and oil production.

The second largest oil field in Kazakhstan Tengiz has also a great shortage in gas. It is also injected back into the reservoir to maintain oil production at the required level. In addition, the country has nurtured plans for construction of integrated petrochemical complex in Atyrau (Western Kazakhstan) for long time, which needs more than 2 billion cubic metres of gas in the first phase.

As for the third major deposit in Kazakhstan Kashagan, it is known that due to leaks detected in the gas and oil pipelines, oil and gas production has been suspended for the second half of 2016.

And according to some experts, it is not the final date for the start of commercial oil and gas production at Kashagan. Thus, in the next five or ten years, the issue of Kazakhstan’s participation in the TANAP project is unlikely to be feasible, the representative of the Ministry of Energy of Kazakhstan summarised.

Meanwhile, according to the Azerbaijan’s Ambassador to Kazakhstan, there are a lot of common interests in the development of mineral resources of the Caspian Sea.

"Baku Deep Water Jacket Plant named after Heydar Aliyev has long been ready to supply the necessary equipment to Kazakhstan for development of Kazakh part of the Caspian shelf. Our equipment is several times cheaper than that of the European counterparts. Great prospects are also opening up in the area of alternative energy, which Kazakhstan is also interested in,” Gashimov said.

In addition, he said, since the onset of such a large infrastructure project as the logistics center in Aktau (West of Kazakhstan), the sides pin their hopes for significant growth in mutual trade.

"The logistics center in Aktau is being constructed at the investments of a whole group of companies of Azerbaijan. The biggest of them is Azersun Holding. It is expected that the total amount of financial investments in this project will amount up to €20 million. And we expect that by the end of the year the construction of the logistics center will be completed,” Gashimov said.