A group led by the Italian energy group Edison has signed a deal for a pipeline to carry Caspian gas to Italy via Turkey and the Adriatic, cutting EuropeÔÇÖs dependence on Russia as its main gas supplier.
A memorandum of understanding for the Interconnection Turkey-Greece-Italy project, or ITGI, was signed yesterday in Ankara between Edison, TurkeyÔÇÖs state- run natural gas company Botas and Greek natural gas company Depa.
The ITGI project aims to transport an annual eight billion cubic metres of gas to Italy by upgrading existing infrastructure in Turkey and Greece and building a final link to Italy.
Plans include upgrades to TurkeyÔÇÖs national grid to enable transit of gas; improvements to a pipeline to Greece completed in 2007; and construction of the new 800-kilometre Greek-Italian section of the pipeline.
ITGI will compete to secure supplies from Azerbaijan's Shah Deniz II field with the Nabucco consortium, which aims to pipe 30 billion cubic metres of gas a year to central Europe; and the TAP project, led by Norway's Statoil and Swiss energy trading company EGL, which will link Albania with Italy.
ITGI will be completed by 2017 to coincide with Shah Deniz II coming online. It is thought that that the second phase of Shah Deniz will begin producing around 17 billion cubic metres per year from 2016-17.
Roberto Pot├¼, executive vice president of Edison, said: ÔÇ£TodayÔÇÖs agreement is a big step forward for ITGI because it completes the framework for the transit in Turkey and enables us to speed up the finalization of the gas contract with Azerbaijan.ÔÇØ
He added: ÔÇ£The pipeline represents a strategic infrastructure which will significantly increase the European energy security as it will be the first link with the Caspian area where about 20% of worldÔÇÖs gas reserves are located.ÔÇØ
Harry Sachinis, chairman and CEO of Depa, said: ÔÇ£This agreement extends and deepens our relationship with BOTAS and EDISON, further leverages the existing Turkey-Greece Interconnector, and creates the immediate opportunity to bring Caspian and Middle East gas to Europe through the existing infrastructure as well as through the planned ITGI Pipeline, thus enhancing European energy security.ÔÇØ
Faz─▒l ┼×enel, chairman and general manager of BOTA┼×, said: ÔÇ£We give utmost importance to all such projects including the ITGI aiming to transit Turkey and we always stress the fact that Europe will be in need of all the gas to be carried by these complementary projects in the coming future.ÔÇØ
Although the exact cost of the project has not been disclosed, Sachinis said the European Union was providing loan support of Ôé¼100 million.
Europe is looking to diversify its sources of gas as consumption of the fuel is set to rise at an average annual rate of 0.8 per cent through 2030. Turkey, which is seeking membership of the European Union, wants to be a conduit for gas and oil from the Caspian, Russia, Iraq and Iran to Europe.
