Does Azerbaijan need TAP? - ANALYSIS

19:52 21-12-2015

Does Azerbaijan need TAP? - ANALYSIS
Realization of the Trans Adriatic Pipeline (TAP) project, designed for transportation o Shahdeniz II gas to Europe, is still remaining undecided. The reason is not unusual – the countries offering transit opportunities, first of all Greece is trying to acquire a political dividend from TAP and leveling construction of the pipeline to the ground. According to project, 478 km of the 800 km-gas pipeline stretches to Albany from Greek territory, from there, the 105 km-pipeline to be constructed through the bottom of Adriatic Sea will deliver Azerbaijani gas to Italy. Construction of pipeline proves its value in terms of costs. However, political and economic crisis in Europe not only reduce the interest of participating countries in the project, at the same time these countries use their transit opportunities as a pressure against other sides. Economic situation of Greece and Albany is known, Athena also uses its 10 small strategic advantages as a means of pressure even against Europe, Turkey.

Not buyer, but seller is always right in energy market 

Who must construct the pipeline? Azerbaijan is interested in the construction of pipeline because TAP creates extra opportunities for transportation of Shahdeniz II gas to Europe through Turkey. Europe is also theoretically interested in TAP implementation. Azerbaijani gas will reduce European energy dependence on Russia and create opportunity for diversification of transportation routes of energy carriers. Greece is also interested in the project because major part of its demand for energy will be met as the TAP passes through this county. At the same time, Athena will purchase gas for lower price as a participant of this project. Moreover, Greece will earn as cash or fuel from transit opportunity. Theoretically, Europe, as well as Greece should be interested in TAP implementation first of all. 


However, this interest is not shown in the action. The question “But who will construct the pipeline?” appears and for some reason, Europe also expects steps to be taken for this purpose from Azerbaijan. Logically, dictating side must be Azerbaijan. Azerbaijan in any case can deliver Shahdeniz II gas to Turkey via TANAP. Europe must have more interest than Azerbaijan in transportation of gas to the “Old World” from here.  Europeans behaviors demonstrate that by delaying implementation of the project they hope Azerbaijan to show financial initiative in this regard too. Logic and estimation are such – Azerbaijan will agree to fund Greek part of TAP in order not to lose European market, buyers in here. Because, Baku knows that Athena is unable to do that. 


However, the estimations are wrong or current geopolitical situation destroys Eurpoeans’ plans to delay the TAP. Azerbaijan has sufficient alternatives to sell its gas. Turkey’s demand for bleu fuel increases year-by-year, filling of the gap created on the background of aggravation of political relations of Russia and Ä°ran with Ankara in the market by Azerbaijani gas is being considered as an alternative in any case. TANAP project is designed for transportation of 10 bcm of gas to Greece through Greek border per year. Turkey seriously needs this gas. There are facts of Russian manipulations on reduction of gas transported to Turkey, in additional Iran’s refusal to increase the gas export to Turkey and these facts makes Ankara think seriously.  Why does not Turkey starting gas transportation from the Northern Iraq meet a part of its demand from Shahdeniz II gas? This means that Turkey is buyer of Shahdeniz gas.


Finally, Europe has always blamed Russia for using energy factor as a means of political pressure. These are sufficiently grounded acusations. However, it’s needed to take into account that Europe also changes the fact of buyer of large volume of energy to the political pressure timely. Through the Caspian gas is an alternative energy source or Europe, the “ld World” always tries to dictate its own interests approaching Azerbaijan with the principle of “the customer is always right”. 

Consequently, delaying of projects like TAP will change the European energy map. “The customer is always right” principle is out of the energy market. In this market, the dictating side is a side which offers energy carriers. Regarding gas transportation to Europe, Azerbaijan must a dictating side. This may be started with refusing the TAP project. In any case, Azerbaijan will lose nothing. Selling and buying are known…


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