Caspian Energy Journal Caspian European Club
Monday, 01 April 2019 17:00

Trump’s statement hindering Nabucco’s revival?

Trump’s statement hindering Nabucco’s revival?

In the telegram of congratulations sent to President of Turkmenistan Gurbanguly Berdimuhamedov on the occasion of the Novruz Holiday, the U.S. President Donald Trump has expressed the hope that Turkmenistan will start taking the opportunity of gas export to the West after the recent determination of the legal status of the Caspian Sea, Caspian Energy News ( reports with reference to

“I hope that Turkmenistan will manage to benefit from the new opportunities of gas export to the West due to the recent determination of the legal status of the Caspian Sea”, Trump stated.

Information that the Russian energy Company Gazprom can in the short term recommence Turkmen gas purchase, suspended in 2016, appeared in the Russian media right after this statement.

Chairman of the Management Committee of Gazprom Alexey Miller stated it in the interview with the Turkmen channel “Vatan” following the results of the negotiations held with the Turkmen President Gurbanguly Berdimuhamedov in Ashgabat.

“We see great prospects of expansion of our cooperation in the gas field, and the most important thing is an understanding that just in the near future we will continue our job under the contract on purchase of Turkmen gas. I told Gurbanguly Berdimuhamedov about the achievements of our company. We can offer our Turkmen partners technologies and the experience of using of equipment, as well as techniques that Gazprom possesses”, Miller said in his interview.

Purchase of Turkmen gas was stopped in 2016 when Gazprom accused Turkmengaz of serious violation of the contract, RBK says. Since 2008 Gazprom tried to reconsider the price of Turkmen gas it purchased. In mid of 2015 the Russian concern brought an action against Turkmengaz before the Stockholm Court of Arbitration, demanding the correction of contract prices.

The project of the Trans-Caspian gas pipeline has existed since 1998. The US companies prepared the feasibility study for the project, but the unsettlement of the Caspian Sea status hindered its implementation.

Nowadays the project was expected to have reached the practical implementation stage. However, it appears that the US President’s latest statement will not promote that, given the uneasy relationship of the United States with Iran and Russia (the sanctions policy). Therefore, any political interference into this project at this stage cannot be considered as a factor of stability of the Caspian region, and is also counter-productive in economic terms.  

It is noteworthy that President of Azerbaijan visited Austria the other day and it is also conceivable that addressed during the negotiations was the matter of transportation of Caspian gas via SGC to the gas distribution hub in Baumgarten and from there to the markets of the north-west countries of Europe, including Great Britain which is in desperate need for new natural gas sources due to the Brexit facing it.

It is worth reminding that in the course of the visit of Turkmenistan President Gurbanguly Berdimuhamedov to Austria in October 2011, the Austrian Chancellor Fischer stated: “I afforded myself to inform you about my talks with President Aliyev, which we had yesterday, and the issue of energy sector, especially the matter of natural gas and the matter of Nabucco, played an important role”, the head of the Austrian Republic said.

He emphasized that the Nabucco project was of paramount importance for his country. According to him, Austria refused to use nuclear energy, and despite an active work in the field of renewables, it is in need of gas import.

Fischer noted that the Nabucco pipeline would end in Austria from where gas would be distributed across Europe. According to him, it is in Austria’s neighborhood where the biggest can consumers are located - Germany, Italy, Switzerland and other countries which have a high developed economy.

The Federal President of the Austrian Republic expressed his satisfaction that Berdimuhamedov is optimistic about Nabucco project and ready to provide energy resources for it.

He accepted the Turkmen President’s opinion, that Turkmenistan will provide its gas for a fair price on its borders, as just.

The Nabucco gas pipeline project was rejected by the Shah Deniz field development Consortium in favor of the other route Turkey-Greece-Italy. However, the growing demand for gas in the EU, problems in the Italian market, pose necessity of transportation of Azerbaijani gas via SGC to other European markets, including the revival of the Nabucco route. It implies transportation of natural gas from the Caspian region towards the European countries across Azerbaijan, Georgia, Turkey, Bulgaria, Hungary, Romania and Austria. A 3.3 thousand km long highway will be a branch of already constructed SGC and is capable of transporting 30 bcm per year. The project is estimated at about 7.9 billion EUR.

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