Total to join TANAP

According to Christian Giudicelli, General Manager of Total E&P Azerbaijan, the French energy giant was invited to participate in the Trans Anatolian pipeline project (TANAP), planned by Turkey and Azerbaijan, as were BP and Statoil, its partners in Shah Deniz, the biggest Azeri gas deposit. It will take the Shah Deniz partners “several months” to decide on a route, Giudicelli stated.  

“We are evaluating the TANAP proposal very seriously,” Giudicelli confirmed in a recent interview in the Azeri capital of Baku.

Scheduled to make a final investment decision next year, the EU-backed Nabucco: a €7.9 billion (US$ 10.5 billion) pipeline project to import Caspian fuel, will consider whether to link up with TANAP or not. As Nabucco vies with competing links for Azeri and other Caspian region gas resources, this decision has been repeatedly delayed.

Last December, Turkey and Azerbaijan signed a memorandum of understanding to build the 2000 km (1240 mile) TANAP pipeline from eastern Turkey to its EU border. The link could carry up to 10 billion m³/yr of gas to EU countries from Shah Deniz, while Turkey will buy 6 billion m³. Further agreements between the two countries have been delayed as Turkish and Azeri companies work out their stakes. Reportedly, Turkey wants as much as a 50% stake in the pipeline.

Socar, Azerbaijan’s state oil company plans to start with around 80% of TANAP, which, according to a preliminary feasibility study, may cost US$ 5 - 7 billion, Socar President Rovnaq Abdullayev said in an interview earlier this year. Sharing the remaining 20% are the Istanbul-based state pipeline company Boru Hatlari Ile Petrol Tasima AS (Botas) and oil and gas producer Turkiye Petrollari AO.

Azeri Industry and Energy Minister Natiq Aliyev is cited as saying that Turkey may increase its stake in TANAP if it has the financial resources. Meanwhile, according to Abdullayev, Socar plans to keep control of TANAP, while offering part of its holding to BP, Total and Statoil.

According to Giudicelli, these Shah Deniz partners are also planning to nearly triple the South Caucasus Pipeline (SCP)’s the capacity. The 692 km long pipeline connects the Sangachal terminal near Baku to the eastern Turkish city of Erzurum via Georgia. Its capacity will be increased to 24 billion m³/yr from 8.8 billion m³/yr by adding compressor stations and building a parallel link to the existing one, Giudicelli added. The expansion is expected to be completed before the planned second phase of Shah Deniz commences in 2017.

After reporting a gas discovery last September, Total is continuing exploration of the Absheron development with Socar and France’s GDF Suez SA. “Our initial estimate of Absheron’s reserves is several trillion ft³ of gas,” Giudicelli said. “The range of the evaluation is still large because we have only one well at the moment.”

Socar has also estimated that Absheron may contain up to 300 billion m³ of gas and 45 million t of condensate. Currently, Total and Socar each hold 40%, and GDF Suez (GSZ) has the remaining 20% of this field. Production at the field may start “somewhere in the 2020s”, Giudicelli said, and the partners will invest “several billions of dollars” to develop it.

After 15 years in Azerbaijan, Total is looking to expand its presence, Giudicelli said. “We are interested in growing in Azerbaijan … We can offer our experience and knowledge in developing other prospective structures in Azerbaijan.” 

Edited from various sources by Cecilia Rehn

Read the article online at: https://www.worldpipelines.com/business-news/04042012/oil_and_gas_major_total_to_join_tanap_project_carrying_caspian_natural_gas_to_europe/