SOCAR looks to wrap up gas-transit talks with Turkey in Sept
BAKU. Sept 12 (Interfax) - State Oil Company of the Azerbaijani Republic (SOCAR) will conduct its next round of negotiations with Turkey over issues involved in transiting Azerbaijan gas to Europe, head of the SOCAR foreign investment management division Vagif Aliyev told reporters in Baku on Monday.
"There has already been one round this month. The next round of talks will take place this week. We expect that we will complete all the negotiations by the end of the month," Aliyev said in response to a question from Interfax.
The entire range of issues is being discussed during the talks, he said. "There are commercial and legal aspects, and questions of law. This is a new role for Turkey, as it has never been a transit country, which requires changes to internal procedures," he said.
The main commercial principles for transiting gas through Turkey were coordinated in June of last year, Aliyev said. "And Azerbaijan's position envisions negotiations on these principles," he said.
A gas-transit agreement with Turkey will help in the creation of a rules and regulatory base for transiting Azerbaijani gas through that country and others. At present, Azerbaijan and Turkey work together in the Baku-Tbilisi-Erzurum project on the basis of a gas-purchase agreement.
The Shah-Deniz project members are BP (operator, 25.5%), Statoil (25.5%), SOCAR (10%), Lukoil (10%), NICO (10%), Total (10%), and TPAO (9%). The development contract was signed on June 4, 1996.
Stage-1 development of the deposit involves the production of 178 billion cubic meters (bcm) of gas and 34 million tonnes of condensate. This phase of development includes agreements struck on sales of gas between Turkey, Georgia, and Azerbaijan. The 690-km pipeline was built to move Azerbaijani gas to Turkey (442 km in Azerbaijan and 248 km through Georgia).
The cost of Stage-2 is estimated at $20 billion. Annual extraction volume will be 16 bcm of gas. Initial Stage-2 output was planned for 2012, but in light of unresolved gas-transit issues, the timeframe has been pushed back to 2017.