The European Union will have to get Turkey’s consent for its quest to secure sufficient natural gas supplies ahead of winter by obtaining approval from Ankara for more gas supplies from Azerbaijan.
In the wake of the recent memorandum of understanding (MoU) signed between the EU and Azerbaijan to double natural gas purchases, an agreement signed back in 2012 between Ankara and Baku for supplies via the Trans-Anatolian Natural Gas Pipeline (TANAP) stipulates that Turkey has the first right to additional pipeline capacity.
European Commission President Ursula von der Leyen and European Commission Energy Commissioner Kadri Simson signed an MoU late on Monday during their trip to Azerbaijan to double the current natural gas purchases from Baku.
Europe, which is heavily reliant on Russian gas, is working to replace Russian supplies and according to von der Leyen is “moving toward more reliable energy suppliers."
To wean off the 155 billion cubic meters (bcm) of natural gas from Russia annually, Europe wants a capacity increase in the Southern Gas Corridor to buy much more gas from Azerbaijan.
However, additional investments are needed to increase gas flow to Europe from Azerbaijan, which has 1.3 trillion cubic meters of proven natural gas reserves, according to BP.
TANAP is the central part of the Southern Gas Corridor, which connects the giant Shah Deniz gas field in Azerbaijan to Europe through the South Caucasus Pipeline and the Trans Adriatic Pipeline (TAP).
Plans are afoot to double the annual capacity of the TAP bringing gas from Azerbaijan to Europe, the European leg of TANAP, from the current 10 bcm to 20 bcm.
Theoretically, it is possible to increase the capacity of TANAP from 16 bcm to 24 bcm and then to 31 bcm through investments, although this does not seem achievable in the next five years because although investments have been made for capacity increases, additional protocols and agreements are required.
Clauses 8 and 9 of the seventh article of the intergovernmental agreement signed between Turkey and Azerbaijan on June 26, 2012, gives priority to Turkey for capacity expansion and supply increase works related to TANAP.
The intergovernmental agreement clauses are as follows:
7.8: The states expressly agree that all volumes of gas belonging to the Republic of Azerbaijan and planned to be shipped via the TANAP system in excess of an initial volume of sixteen (16) billion cubic meters per year will first be offered to buyers in the Republic of Turkey.
7.9: The expansion of the TANAP system above the initial capacity of thirty-two (32) billion cubic meters per year shall be subject to the mutual agreement of the states.
