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RWE: 3rd Round Of Talks To Buy Azerbaijani Gas On Fri

RWE: 3rd Round Of Talks To Buy Azerbaijani Gas On Fri
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Τετ, 10 Νοεμβρίου 2010 - 19:10
German energy company RWE AG (RWE.XE) Friday will resume negotiations to secure natural gas from Azerbaijan that would be crucial to reduce Europe's dependence on Russian imports, the company's head of supply and trading said Wednesday.
German energy company RWE AG (RWE.XE) Friday will resume negotiations to secure natural gas from Azerbaijan that would be crucial to reduce Europe's dependence on Russian imports, the company's head of supply and trading said Wednesday.

Friday's talks, which also involve Austrian energy company OMV AG (OMV.VI), are the third round of negotiations with a consortium that is developing the second phase of an offshore field in the Caspian basin called Shah Deniz, in a process that might take another few rounds before the consortium selects a buyer early next year, Stefan Judisch said on the sidelines of a gas conference in the German capital.

The two companies--together with Turkey 's Botas , Bulgaria 's Bulgarian Energy Holding, Romania 's Transgaz and Hungary 's MOL Nyrt. (MOL.BU)--are developing Nabucco, a EUR7.9 billion, 3,300-kilometer long pipeline that is competing fiercely with two other projects to get the Azerbaijani gas.

Nabucco can offer the best price for the gas because it would transport more of it than its competitors, Judisch said.

The project's size has been usually considered a downside, since many experts have been saying that there wouldn't be enough gas in the region to fill it and make it profitable in the medium term.

Nabucco's competitors are much smaller and the Azerbaijani gas could be enough to fill them.

ITGI is being developed by Italy 's Edison SpA (EDN.MI) and Greek monopoly gas company DEPA. Norwegian energy giant Statoil ASA (STO), Swiss energy-trading company Elektrizitats-Gesellschaft Laufenburg AG (EGL.EB) and Germany 's E.ON AG (EOAN.XE) are developing TAP.

However, Judisch explained that the consortium expects to be able to secure a second supply source in time for the Shah Deniz gas sale.

The Azerbaijani gas would fill about one third of the 31 billion cubic meter Nabucco, with the rest coming from Iraq , Judisch added. He said that an existing pipeline between Northern Iraq and Turkey could transport about 18 bcm, but he didn't elaborate on the extraction potential that the Kurdistan region in Iraq offers.

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