Industry and Energy

Industry and Energy

Azerbaijan President: Lots of questions on Nabucco not answered for quite a lot of time

28 January 2010 17:15 (UTC +04:00)

Nabucco, the EUâ€™s largest cross-border infrastructure project, is bogged down over financing, pricing and politics, Aliyev said in an interview with Bloomberg Television late yesterday at the World Economic Forum in Davos, Switzerland.

â€œIf we are offered a good price and a serious approach, then it can happen,â€ Aliyev said about Azerbaijanâ€™s potential role as a supplier. â€œPolitical statements damage the process. We do not want to find ourselves in the middle of a battle between various forces that cannot agree.â€

Azerbaijan, perched on the western Caspian between Russia and Georgia, was expected to be the first supplier to Nabucco, which would stretch 3,000 kilometers (2,000 miles) from Turkey to Austria. As preparations for the 7.9 billion-euro ($11.1 billion) project drag on, Russian gas exporter Gazprom has offered to buy all new gas from Azerbaijan in a bid to strangle competition from EU companies.

The group lacks a clear leader able to attract the necessary financing or conduct talks with suppliers and transit countries, Aliyev said. The participation by some Nabucco countries in a rival Gazprom project â€œcreates a kind of ambiguity,â€ he said.

â€œSo far we do not know who is that leader who will move this process forward,â€ Aliyev said. â€œWho will engage itself in negotiations with gas producers, transiters? Who will do the marketing for this gas? What will be the pricing? So a lot of questions that are not answered for quite a lot of time.â€

Azerbaijan, which became a gas exporter in 2007, is interested in diversifying export routes, Aliyev said. Talks have stalled over the price of gas to Turkey, the only Nabucco partner not in the EU.

Azerbaijan produced almost 25 billion cubic meters in 2009, more than double domestic demand, Aliyev said. Gazprom started importing Azeri gas this year via a Soviet-era pipeline. The Russian company plans to double purchases from Azerbaijan to 1 billion cubic meters this year and again to 2 billion cubic meters in 2011.

â€œThe advantage with Gazprom is that we donâ€™t have any middlemen,â€ Aliyev said. Nabucco, Aliyev said yesterday.

The project is headed by Austriaâ€™s OMV AG with shareholders RWE AG of Germany, Hungaryâ€™s Mol Nyrt., Romaniaâ€™s Transgaz SA, Bulgariaâ€™s Bulgargaz AD and Turkeyâ€™s Botas.

Bulgaria and Hungary are cooperating on Gazpromâ€™s South Stream, while Austria has also expressed interest in the project linking Russia to southeastern Europe via the Black Sea.