The 31bn m³/yr Nabucco pipeline project could end up being merged with competing southern corridor pipelines Trans-Adriatic pipeline (Tap) and Italy-Turkey-Greece Interconnector (ITGI), Austrian OMV chief executive Gerhard Roiss said.
The admission marks a move away from OMV's previous stance that Nabucco would provide a one-stop-shop solution to Europe's growing gas demand. “We are a strong believer in Nabucco but if we merge with another pipeline I do not care,” Roiss said.
OMV said its priority is now to expand its upstream market and it sees the mid-stream Nabucco pipeline project as a vehicle to gain access to upstream development in Azerbaijan. An initial agreement has been signed between OMV and Azeri state-owned Socar on future upstream co-operation, Roiss said.
Roiss said that OMV will first present an economic model for Nabucco on the basis of 21bn m³/yr and progressively move it up to 31bn m³/yr. Much of this gas is expected to come from Azerbaijan's Shah Deniz field as well as other fields in the country, which are under development. Other potential gas supplies from Iraq's semi-autonomous Kurdish region and Turkmenistan remain more uncertain. The implementation of a hydrocarbons law in Iraq continues to divide Erbil and Baghdad and in Turkmenistan the construction of a sub-sea pipeline depends on EU energy commissioner Gunther Oettinger, who can negotiate on behalf of the project.
Cost estimates for the Nabucco pipeline have risen to some €12bn ($16.2bn) from an initial €7.9bn and the consortium is due to present a bid with a tariff plan to the Shah Deniz consortium at the beginning of October.