Nabucco is Not Dead Yet

We’ve written several times about about the delicate dance performed by Azerbaijan to balance their interests between cooperating with Russia and occasionally leaning toward the West, from the humiliation of Dick Cheney (once he was a lame duck) to the recent MoU signed between Gazprom and SOCAR (seen as a fatal blow to the Nabucco pipeline project).

An article we came across from New Europe reports that Nabucco is still fighting for life, despite this Gazprom pre-emption:

But the Nabucco spokesman said that gas for the first stage of Nabucco would come from Phase 2 of Azerbaijan’s massive Shah Deniz field. “Shah Deniz is one of the sources that are most feasible. We have no information that this (the Gazprom-SOCAR deal) would have any impact and we also know that this is not actually Shah Deniz 2 gas which was somehow intended for Russia,” Dolezal said.

He also dismissed concerns that Nabucco would compete with Russia’sBlue Stream 2 pipeline. Gazprom CEO Aleksei Millertwo weeks ago visitedTurkey and reached a preliminary agreement on building the second trunkof the Blue Stream pipeline. Turkey may also host Nabucco as Azeri gaspasses through the pipeline en route to Europe. “(Blue Stream 2) willnot compete with Nabucco. We know that Turkey has of course a peak needfor gas and needs gas for its own market as well and this has nothingto do with our project,” Dolezal said. Negotiations with Ankara onprices and taxation have been difficult. Moreover, Turkey demands apre-emptive right to buy some of the Azeri gas that will pass throughNabucco. The Nabucco spokesman said these issues would be part of theintergovernmental agreement, which is now under negotiations on theministerial level.

The shareholders of the Nabucco consortium are: Botas (Turkey),Bulgargaz (Bulgaria), MOL (Hungary), OMV(Austria), RWE(Germany) andTransgaz (Romania). There is also speculation that Gazprom – through anacquisition of 20 percent of MOL by Surgutneftegaz announced on March30 – is trying to put up some roadblocks in Europe, Alfa Bank’s Smithsaid. MOL is Hungary’s leading oil and gas company, and that is thearea through which Nabucco will have to run. OMV, MOL and Bulgargazhave also signed up to South Stream pipeline, which bypasses Turkey.”They are covering all their bases making sure they are not on thelosing side of any of this,” Smith said. “I don’t think both SouthStream and Nabucco will happen. They want to make sure at least one ofthem happens.”