’Turkey got more than it wanted on Nabucco’

The intergovernmental agreement on the Nabucco pipeline project, which will bring Caspian and Middle Eastern natural gas to Europe, puts into place the physical infrastructure to alleviate Turkey’s concerns for its own energy needs, a senior European commissioner has said.

Turkey got what it wanted and probably more than it wanted, Andris Piebalgs, European commissioner on energy issues told Hürriyet Daily News & Economic Review. Piebalgs answered questions from the Daily News in a written interview ahead of the signing ceremony for the agreement that will take place on Monday in Ankara. Piebalgs will come to Turkey to attend the ceremony for the agreement, which took years to negotiate.

One of the reasons for the delay was Turkey’s request for part of the gas allocated for its own needs.

"Turkey quite rightly wanted to make sure that its security needs were satisfied. I have always thought this was a normal and fair position," he said. "It would not be acceptable to any country to see gas pass through its territory, destined for another market, when the domestic market is starved of gas. Turkey wanted a mechanism to avoid that," said Piebalgs, explaining the formula that allowed the consensus.

"The agreement puts in place the physical infrastructure for that to be ensured and then says that Turkey and the EU member states involved will respect commercial agreements that will supply gas to Turkey in the event of a crisis," he said. "The physical infrastructure consists of pumps that work in both directions. Turkey traditionally has received gas from Russia, Azerbaijan and Iran; in the future it could get its gas, if and when needed, from any source connected to the European Union grid," Piebalgs added.

Complicated

It took five years to bring Nabucco to this point, as this project is more complicated than other projects. Unlike previous pipelines, it would not simply connect at the border with a supplier; it had to cover at least five jurisdictions, inside and outside the European Union, and it has potentially five supplier countries.

Although the European Commission was not directly involved in the choices to be made, it provided assistance to all sides at the negotiating table. Piebalgs compared the agreement to a train ticket. "A train ticket sets the price to use a train from one place to another. The agreement sets the price for taking gas from one place to another," he said.

Piebalgs dismissed criticisms that there is no gas to fill the pipeline. "We will not be short of gas. There are many options," he said.

"I think Azerbaijan and its Shah Deniz and ACG fields are the top priority. Iraq is certainly important and a country that we have many hopes for. We are in regular contact with the Iraqi authorities."

The commission started to explore possibilities for a buyer’s consortium to achieve a critical mass for new production development in Turkmenistan, said Piebalgs. "This is an area where we work closely together with Turkey, which shows a great interest in this project. Some other countries in Central Asia might also fill in the Nabucco pipeline in the future."

Piebalgs was less optimistic on Iran as an option. "Iran has major gas reserves and will surely export them one day, but today it imports gas. On top of that, there are the political and legal issues," he said. "Until the outstanding questions are solved, Iran will remain a difficult option," he added.

The commission will continue to closely follow the Nabucco project. "We will be especially interested in the upcoming open season for capacity allocation," said Piebalgs, adding that there will be two objectives in this regard: that Turkey gets a sufficient amount of gas to ensure the security of its supply and that capacity is sold for the long term over the greatest length of the pipeline.

"The commission has a clear preference that gas from Azerbaijan be accommodated first."

Turkey - EU relations

The European commissioner for energy also commented on the significance of the Nabucco pipeline on Turkey-EU relations.

"Nabucco is a good omen. It is positive that Turkey and the EU not only discuss controversial issues but also manage to agree on a strategic project that is important for both sides," said Piebalgs.

"It strengthens ties between Turkey and Europe. Nabucco not only makes the political climate better, but it also creates a physical link between us. In the long term, as the project develops, Turkey will increase its political presence and importance through the project," he added.

"There is also one important psychological effect in the European Union: For the first time, millions of European citizens Ğ those who have suffered from gas shortages during the last winters Ğ will see Turkey as a ’major helper’ in their quest for energy security. The same is also true in Turkey: For the first time in a domain as vital as energy security, Turkish citizens, businessmen and politicians will see that Turkey and the EU are dealing hand-in-hand with a common challenge."

Piebalgs said the commission fully supports the opening of the energy chapter. It has been impossible to start talks on the energy chapter because of the Greek Cypriot veto. The delay is regrettable for the commission, he said.