Wednesday, August 10, 2016

"Turkey-Russia Rapprochement Spells Bad News for Azerbaijan"

From the Wall Street Journal:

Revival of TurkStream pipeline casts cloud over European project using Azeri natural gas 
Russia and Turkey signaled that they would resuscitate the development of a natural-gas pipeline between them, potentially undermining European efforts to reduce reliance on Russian energy with fuel piped in from Azerbaijan.

Presidents Vladimir Putin and Recep Tayyip Erdogan, in a meeting Tuesday in St. Petersburg, indicated the way was clear again for the pipeline known as TurkStream, which would bring gas from Siberia under the Black Sea. The project had been sidelined after Turkish jets shot down a Russian warplane near the Syrian border in November, causing a diplomatic rupture.

When complete, the pipeline would have the capacity to pump more natural gas into Turkey than it could consume, making the country a potential hub for sending Russian gas into Europe.

That would be a blow for Azerbaijan. President Ilham Aliyev has said he wants to make his country a major gas exporter. The country needs to replace revenues from oil production, which is declining.
Azerbaijan and European officials had touted the development of a southern gas corridor, a 2,200-mile network from the Caspian Sea through Turkey and then across Greece and into Italy.
In May, Maros Sefcovic, the European Commission’s vice president and leading spokesman on energy policy, called the corridor “vital for reaching the EU objectives” of diversifying its energy sources.

The U.S. State Department in 2013 called it “an important contribution to global energy security.”

Russia already is the source of a third of the European Union’s natural-gas supply, mostly piped through Ukraine. European officials have complained that Russia uses energy as a political weapon, especially against Eastern European countries, and has set a policy of finding new sources.

Pipelines for the southern corridor are under construction and the first gas deliveries to Europe are expected in late 2019, but with TurkStream back on track to come online the same year, it might not make commercial sense to expand its capacity as planned.

“The realpolitik is that if you’re on the ground in Turkey thinking where will your gas come from, in the end it’s Russia that has the gas and can deliver it,” said Jonathan Stern, chairman of the Oxford Institute of Energy Studies.

Azeri energy officials didn’t respond to requests to comment....MORE
 See also RT: "Turkey to transit Russian natural gas to Europe via Turkish Stream pipeline - Erdogan".
"Iran, Russia map out rival to Suez Canal"
New Russian Pipeline In Baltic Sea Could 'Collapse' Ukraine
Just to make things really interesting you also have the Trans-Anatolian Pipeline running gas from Azerbaijan and scheduled for completion in 2018:...
 That was five days ago. Things change.