TAP will be connected to the Italian natural gas grid
and Azeri gas is expected to reach further countries in
Western Europe, including but not limited to Austria,
Germany and France or Switzerland.
Supplying Balkan and eastern European
countries: demand for interconnecting gas
infrastructure
To guarantee security of supply, particularly for those
Balkan and central european countries that are suffering
from single-source dependency from Russian gas, TAP will
include reverse flow features, allowing gas to be diverted
from Italy to these countries.
13
There are also discussions
to connect the TAP to regional pipeline systems such as
the planned 5 billion m
3
/yr Ionian Adriatic Pipeline (IAP) in
order to supply Montenegro, Bosnia and Herzegovina and
Croatia. Also, Eastring has been proposed to interconnect
gas infrastructure between Bulgaria, Romania, Hungary and
Slovakia.
The construction of LNG receiving terminals on
the Adriatic shore may also support the diversification
of sources of supply to the Balkan countries, which
could be cut off from the TAP bypass. This has found
support in the EC. To promote a more flexible and
integrated internal gas market, the EC has identified
so-called ‘Projects of Common Interests’ (PCI) including
interconnecting infrastructure, LNG terminals and reverse
flow pipelines, which are benefiting from EU funding and
other incentives.
As an example: to diversify imports from Russia to
Bulgaria, the following interconnectors are planned:
Interconnection Bulgaria-Romania (IBR); Interconnection
Greece-Bulgaria (IGB); Interconnection Turkey-Bulgaria
(ITB); and Interconnection Bulgaria- Serbia (IBS).
The rise of the Turkish Stream
While the EU plans to diversify its gas imports, Russia
is looking to expand its exports to Europe. Russia is
moreover planning to bypass Ukraine as a gas transit
country and to reduce its transit dependency with a
targeted exit by 2019.
14
Therefore, northern and southern
bypass-routes are being considered. On the one hand, this
has become evident with the recent agreement between
Gazprom and its partners to expand its Nord Stream
pipeline across the Baltic Sea to Germany. On the other
hand, Turkish Stream has been launched. This pipeline
connection through the Black Sea redirects the former
South Stream project to Turkey, after the EU’s Third
Energy Package impeded its realisation on EU territory on
legal grounds.
Gazprom and BOTAS have signed a memorandum
of understanding (MoU) for the construction of a new
gas pipeline, 1090 km in length with an overall capacity
63 billion m
3
/yr for all four pipes, to run on the bottom of
the Black Sea basin to the Turkey-Greece border.
So far, all negotiations have only involved one
16 billion m
3
pipeline.
15
According to Turkish Energy
Minister, Taner Yildiz, Gazprom has already delivered
co-ordinates for the routing of the onshore section.
16
The pipeline is expected to be laid onshore near the
Turkish village of Kiyikoy and will then be connected
with the Turkish-Greek gas hub at the border checkpoint
at Ipsala.
17
Russia and Greece have signed an MoU on
the extension of Turkish Stream from this point onwards
through Greek territory.
18
According to IHS (2015), it is not
expected that Turkish Stream would impact the Southern
Gas Corridor project, with all investments under way and
firm long-term contracts signed.
19
Future outlook
Future gas supplies to Europe along the southern corridor
and further developments on the eastern corridor clearly
depend on Turkey’s path towards becoming a major gas
transit country.
As announced in December 2013 by the Shah Deniz
consortium, 100% of the initial capacities of both TANAP
and TAP are secured by 25 year long-term agreements.
Nevertheless, there are speculations as to what extent
other regional players might supply TANAP in addition to
the committed amount delivered by Azerbaijan.
In 2013, Turkmenistan and Turkey agreed on connecting
Turkmen gas supplies to TANAP. However, plans for the
Trans-Caspian Pipeline to bring Turkmen gas to the EU
across the Caspian Sea needs to be realised before this
can happen. This remains difficult due to political and
legal disputes regarding Caspian seawater boundaries.
Turkmenistan has rather shifted its export strategy to
China.
20
With Iran having a 10% stake in the Shah Deniz
Consortium through Naftiran Intertrade Company (NICO)
– a subsidiary of National Iranian Oil Company – post-
sanctions Iran might have a future role in the Southern
Gas Corridor.
21
Besides transporting gas though TANAP, a
potential revival of the Iran-Turkey-Europe (ITE) pipeline
might be also possible. However, as forecasted by BMI,
there is only limited export potential until 2025 due to
internal demand, the lack of spare gas for exports, and
absence of production and export infrastructure.
22
The
Kurdistan Regional Government in Iraq (KRG) also has the
potential to supply Turkey with gas. Until now, disputes
with the Federal Iraqi Government regarding outstanding
payments have impeded investments and the development
of necessary treatment and export infrastructure, for
example an Erbil-Ceyhan gas pipeline.
Initially, the EC expected a rather ambitious supply
rate of roughly 10 - 20% of EU gas demand by 2020
(45 - 90 billion m
3
/yr) from the Southern Gas Corridor.
23
It
has become clear, though, that these targets will not be met,
at least in the foreseeable future. Initially, TANAP will have
a capacity of 16 billion m
3
/yr when entering Turkey, which is
AUGUST 2015
/
World Pipelines
27
