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George Papaconstantinou: ITGI is the bankable project to open the Southern Corridor immediatelyâ€

25 October 2011 16:32 (UTC +04:00)

â€œNot only is it the best project from an economic and technical point of view, it is also of strategic importance, and promotes the strategic relations between Azerbaijan and Greece. The project will make Greece the gateway for the Azerbaijani gas to Europe,â€ Mr Papaconstantinou said.

"There are also other pipeline projects on the table which can become a reality in the medium-term," Papaconstantinou stated.

"But ITGI is the bankable project to open the Southern Corridor immediately," Papaconstantinou said.

ITGI is optimal for Azerbaijani gas exports to Europe stated Mr Sachinis.

â€œNot only can we transport Azerbaijani gas to the rest of Southeastern Europe as early as 2013, but the volume of 10 billion cubic meters of gas that Shah Deniz 2 intends to initially export to Europe fits perfectly within the ITGI systemâ€™s design capacity. And the ITGI systemâ€™s capacity can be increased from 10 to 24 bcm for a relatively small incremental investment,â€ Sachinis said.

â€œITGI is the most technically advanced project and this enables us to have a high degree of certainty in the cost estimates for the project. This is all in all orders of magnitude less than Nabucco. ITGIâ€™s focus is to help Azerbaijan and the Shah Deniz 2 consortium maximize revenues by selling gas to the nearest markets in South Eastern Europe (through IGB), Italy (through Poseidon), and beyond,â€ Sachinis said.

SOCAR and Azerbaijan have two opportunities to participate in ITGI stated George Papaconstantinou, Minister for the Environment, Energy and Climate Change, in Baku.

â€œThe process of DEPAâ€™s privatization will begin in November, and weâ€™ll be glad if SOCAR participates in it, either directly in the ITGI pipeline system, or in DEPA as a whole,â€ Mr Papaconstantinou added, responding to a question.

Mr Sachinis also explained DEPAâ€™s strong privatization and financial position

â€œAny investor in ITGI would be joining a very strong proposition. DEPA maintains a zero debt balance with strong and stable EBITDA. ITGI sponsors are very committed to the development of the project and well prepared to provide significant credit enhancements. We are already implementing our plan for securing the necessary financing with specific steps and strategy,â€ Sachinis continued.

The ITGI pipeline system has several advantages unlike other projects, Mr Papaconstantinou stated

â€œFirst of all is the time advantage: ITGI will be ready to ensure the start of Azeri gas export through Greece to Bulgaria and other Southeastern European countries as early as 2013 (the first route of exports), and as of 2017, when export from Shah Deniz 2 begins, to Italy and beyond (second route).

Secondly, access to customers - ITGI provides access to gas from Azerbaijan to a maximum number in South-Eastern, Southern and Western European countries.

Third, the reality of the project - it is technically and approvals-wise the most advanced and can be realized immediately.

And finally, the fourth and most important advantage is the low price of building the gas pipeline system, therefore enabling its financing through a combination of already approved EU funds, EIB loans, Export Credit Agency financing and parent company equity," Mr Papaconstantinou said.