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Reinhard Mitschek: â€œAzerbaijan has huge potential to export gas to Turkey and Europeâ€ - INTERVIEW

Reinhard Mitschek: â€œAzerbaijan has huge potential to export gas to Turkey and Europeâ€ - <font color=red>INTERVIEW</font>

11 October 2012 13:13 (UTC +04:00)

Baku. Victoria Dementieva - APA-Economics. Managing director of Nabucco Gas Pipeline International GmbH Reinhard Mitschekâ€™s interview to APA

- Does your current visit connected to the proposals that Shah Deniz Consortium to be presented on Nabucco West project?

- We have ongoing talks with Shah Deniz from Nabucco side. We discuss the participation of Shah Deniz in our project and all the elements of the cooperation agreement Shah Deniz would like to conclude with Nabucco. I hope that in the current quarter of this year we will conclude the agreement.

- What kind of agreement is it going to be? Any legal framework for realization Nabucco West?

- It will regulate the future cooperation with Shah Deniz on Nabucco West. Of course Shah Deniz will take some time more for the final selection between Nabucco West and the TAP and I am confident that Nabucco West is the better choice for this root selection. And in order to provide the data to Shah Deniz, we are open and we provide access to Shah Deniz shareholders to all documents and technical data of Nabucco. We start the diligence process in order to further evaluate the project. We have already opened the data one and a half week ago.

- Shah Deniz stated that they can participate in Nabucco West project like shareholders. So how many % shares Nabucco Consorsium is ready to sell to Shah Deniz?

- There is a topic of discussion within negotiation. And I donâ€™t want to anticipate any results about negotiations. But I feel we can find a compromise on that.

- But what kind of compromise it can be? How do you see the process, if it is a proporsional selling of every Nabucco Cons. Shareholder?

- That is technics. Whenever we will have a compromise on the solution when think about how to technically solve that. The negotiations is not concluded so far but as I said it is not difficult to do that after we have reached a compromise.

And now I donâ€™t want to interfere the process of negotiation by any announcement.

- How is negotiation with other sourse-country -Turkmenistan is going on?

- Project company Nabucco International takes care for the development of the pipeline. And pipeline conditions and the conditions for the access to capacity. But we do not participate in gas sales negotiations. Therefore as Nabucco International I have no direct negotiation with Turkmenistan, that is a topic of gas buyers in Europe. If the gas buyers would like to buy gas in Turkmenistan, when they do negotiate these gas sales.

There is so much cares in Azerbaijan I appreciate its very much. I believe that with Azeri gas we can even fill TANAP and Nabucco West. Of course there is gas from other sources too, from Turkmenistan, Iraq. We welcome that. But I also think there is quite huge potential in Azerbaijan and this also was stated by Socar several times beyond Shah Deniz. There is Shah Deniz II, Absheron field, Umid, Babek. It seems to be 20-30 even 40 bcm available for exports to Turkey and to Europe.

- What if Shah Deniz consortium will not selectjoin the Nabucco West project, will the Nabucco be wrapped up or it will try to find other sources?

- Nabucco is the most advanced project bringing lots of added value to producers. IÂ´m therefore optimistic that Shah Deniz will become Nabucco West shareholder.

- Now Shah Deniz has two options â€“ Nabucco West and TAP. How do you think what are advantages of Nabucco to TAP?

- One is Nabucco has the most robust legal framework. We have ratified intergovernmental agreement by all parliaments of state parties. Most recently this Monday we had political committee meeting of Nabucco in Vienna. Azerbaijan minister of energy N. Aliyev, commissioner Oettinger and all the ministers of Nabucco countries and prime-minister of Bulgaria participated. As a result a ministerial declaration was approved in which the state parties again confirm their support for this strong legal framework with an Intergovernmental Agreement as a basis. The state parties also supported the connection of TANAP and Nabucco West and welcomed potential participation of Shah Deniz in Nabucco. And it is a united and strong positive politicalsignal.

The legal frame work is for sure is a benefit for Nabucco West.
Certainly we can reach a bigger market, it goes directly to the Central European gas Hub in Baumgarten in Austria. This gas hub has already approximately 140 market participants from all over Europe tradinggas. And that is of course a benefit to have landing point directly in the middle of such huge market place.
Nabucco West therefore is not only a simple pipeline: it is a 1300 km marketplace. And that brings added value to producers To reach a market of 500 Million consumers as Nabucco does - or not - makes a big difference.
Thirdly, with Nabucco West I can reach easily not only the Nabucco transit countries and Baumgarten but also the western Balcan countries â€“ Croatia, Serbia, Bosnia, Kosovo, Albania etc. with small interconnectors combining international grids Nabucco can reach all these markets.

Let me summarize: Reaching a much bigger market makes Nabucco commercially very attractive, fare advanced legal framework and project development and strong political support, this are major advantages.