Azerbaijan has inaugurated the first phase of the Southern Gas Corridor (SGC) project to pump its natural gas from the Caspian Sea to Western Europe.
“With this project, we are creating a new energy map of Europe,” Azerbaijan President Ilham Aliyev said at the opening ceremony near the capital, Baku.
During the event attended by European dignitaries, Aliyev turned the tap at the Sangachal gas terminal.
The SGC aims to transport gas 3,500km from the Caspian Sea to Europe, partly as a means to reduce the EU’s reliance on Russian fossil fuels.
The Kremlin relies on oil and gas to fund more than a third of its budget.
But Russian President Vladimir Putin purportedly welcomed diversification of gas supplies to the European market. RIA Novosti quoted Putin saying: “As for the southern corridor from Azerbaijan, we welcome any economic activity in this area. We welcome diversification of energy supplies to the European market because this creates market conditions for work. We are interested exactly in creation of market conditions.”
The project has three linked pipelines that will bring gas from the vast Azeri Shah Deniz 2 gas field across Azerbaijan, Georgia, Turkey, Greece, Albania and under the Adriatic Sea to southern Italy.
It is expected to annually bring around 10 billion cubic metres of gas to Europe from 2020 and 6 billion cubic metres of gas to the Turkish market.
The South Caucasus Pipeline links Azerbaijan and Turkey, from where it will connect to the Trans-Anatolian Natural Gas Pipeline (Tanap). From Turkey, the Trans-Adriatic Pipeline (TAP) will take the gas on to Italy.
Gazprom is also developing the rival TurkStream pipeline to bring gas to Turkish customers and the Balkans under the Black Sea.
Investment in Shah Deniz 2 and pipeline construction is estimated at more than US$40 billion.
Aliyev praised US and EU backing, singling out the UK, for the project and strong co-operation with Turkey and Georgia.
“This project takes into account the interests of everyone, suppliers of gas, transit countries, and consumers,” the 56-year-old president said.
The SGC has been controversial with activists saying western governments have turned a blind eye to human-rights violations in Azerbaijan and that the project will only enrich Aliyev’s cronies.
Aliyev won a fourth consecutive term last month in a presidential election in which international observers reported “serious irregularities” and an absence of meaningful competition.
Azerbaijan’s gas is coming to Europe. Picture credit: YouTube