January 23, 2013
The consortium developing Azerbaijan's giant Shah Deniz gas field has sealed a shareholders agreement with the Trans-Adriatic Pipeline (TAP) project. The announcement follows a similar deal over the Nabucco pipeline, which is competing with TAP for the right to carry the Azeri gas into Europe.
TAP – which is planned to run from the Turkish border through Greece and Albania, before crossing the Adriatic to dock in Italy - announced January 22 that TAP shareholders Axpo, Statoil and E.ON, have agreed the deal with Shah Deniz consortium members State Oil Company of the Azerbaijan Republic (SOCAR), BP and Total.
Under the agreement, the TAP joint venture will be governed by an enlarged shareholder group comprising. It will come into effect if and when SOCAR, BP and Total decide to exercise their options to join the project, in which they will take a combined stake of up to 50%.
TAP’s Managing Director Kjetil Tungland said the agreement is an important milestone. "I look forward to continuing the same close cooperation with the Shah Deniz consortium throughout the course of 2013," he said. Shah Deniz has already signed a funding deal with the project.
The shareholder agreement hands the Shah Deniz investors options on the two projects competing to carry its gas into Europe. A similar deal announced two weeks ago appeared to give an advantage to the rival Nabucco pipeline, which would route to Austria.
Around 16bn cubic metres of gas per year from Shah Deniz will initially be transported via the Trans-Anatolia gas pipeline (Tanap), which will run from the field across Turkey. A second pipeline - either TAP or Nabucco - will then take gas on to Europe. The Shah Deniz consortium is expected to make a final decision by mid-2013.