Azerbaijan-Turkey-Europe: Raising a Glass to Gas

Just when you thought it would never happen, Turkish Prime Minister Recep Tayyip Erdoğan has announced that Azerbaijan, Turkey and Europe will soon be tied “organically." The organic matter in question is, of course, natural gas, soon to flow through a new pipeline, per a long-awaited June 26 agreement between Azerbaijan and Turkey.   

Europe’s organic dependence on Russia could decrease after some 16 billion cubic meters (bcm) of Azerbaijani gas start to flow each year via the Trans-Anatolian Natural Gas Pipeline (TANAP), to be completed in 2018. Turkey will be happily siphoning off six billion cubic meters of the gas, while the rest will head further afield, to Europe. The volumes are projected to nearly double by 2023 and further increase to 31 bcm by 2026.

Shah Deniz 2, the second stage of development of a massive gas field off Azerbaijan's Caspian-Sea coast, will provide the bulk of the supplies, but Erdoğan expressed hope that, in future, the gas will come not only from Azerbaijan, but from its across-the-Caspian-Sea neighbors in Central Asia.

Speaking of ties, TANAP could further tie Azerbaijan to BP. The British energy giant, which leads the Shah Deniz project, has shown interest in purchasing a stake in the pipeline, co-owned by the states of Azerbaijan and Turkey.

Some observers were quick to say that the TANAP deal bodes ill for Nabucco, the energy diversification project backed by the European Union and the US that has long been waiting in the wings for its debut. But the Nabucco Consortium welcomed the less ambitiously sized (and named) TANAP, indicating that it could be linked to a new, watered-down version of Nabucco.