Page 6 - FSUOGM Week 31 2019

FSUOGM PIPELINES & TRANSPORT FSUOGM
US anti-Nord Stream 2 bill makes progress
EUROPE
The bill targets pipe layers but not the project’s nanciers.
THE US Senate’s foreign relations committee has backed a bill that would impose sanctions on companies involved in building Russia’s Nord Stream 2 gas pipeline to Germany.
The committee voted 20 to 2 in favour of passing the Protecting Europe’s Energy Security Act, which would target the operators of vessels laying pipes for Nord Stream 2 and also Turk- Stream, another Russian pipeline project under the Black Sea.
“ ese pipelines could result in further dest- abilisation of Ukraine and enrichment of the Putin regime, and they put at risk the security of NATO member states,” the committee’s chair- man, Republican Senator Jim Risch commented. “ is bill is a speci c, targeted, and timely way to counter Russian malign in uence, and I am pleased that it garnered such broad support in our committee.”
e bill will go to the Senate and then the House of Representatives. If both houses sup- port the dra law – considered likely given the current US political climate – it will be sent to the desk of President Donald Trump for rati cation or veto.
The 1,200-km Nord Stream 2 is already more than two thirds complete. Its Russian
state-owned operator, Gazprom, insists it will be ready to start owing gas to Germany and other European nations by the end of this year, with its capacity ramping up to 55bn cubic metres per year.
If passed into law, the US bill would a ect Ita- ly’s Saipem and Swiss-based Allseas, which are serving as Nord Stream 2’s two main pipelaying contractors. e bill does not propose any pen- alties for Nord Stream 2’s nanciers, however, which include Germany’s Uniper and Winter- shall, Royal Dutch Shell, Austria’s OMV and France’s Engie.
While additional sanctions against Nord Stream 2 enjoy broad support in Washington, some have voiced concerns that the measures could damage US ties with Germany.
“It makes no sense to hurt people that are helping us apply pressure on Russia and in other areas,” explained Republican Senator Rand Paul, who voted against the bill.
Sanctioning the pipeline could also leave the US open to criticism that it is simply look- ing a er its commercial interests, by protecting the market share of US LNG exports, rather than trying to defence Europe from Russian in uence.™
TAP onshore section nears completion
AZERBAIJAN
An expansion project is being prepared, but there is uncertainty over where the gas will come from.
ENGINEERS have welded into place 99% of the Trans-Adriatic Pipeline (TAP)’s onshore section, the project’s operators said on Twitter on July 31.
e pipeline, which runs across Greece, Alba- nia and the Adriatic Sea before terminating in Italy, is due to start transporting Azeri gas next year.
While onshore construction is almost n- ished, TAP is yet to make signi cant progress o shore. Work began preparing the seabed for the 105-km Adriatic section in October last year. But it was not until April this year that Italy’s Saipem lowered the rst of TAP’s o shore pipes into place.
TAP is slated to ow 10bn cubic metres per year of gas at peak capacity, receiving these supplies from Azerbaijan via the South Cau- casus Pipeline (SCP) through Georgia and the Trans-Anatolian Pipeline (TANAP) across Turkey.
TAP’s investors – which include BP, Snam, Azerbaijan’s SOCAR, Belgium’s Fluxys, Spain’s Enagas and Swiss-based Axpo – are currently weighing up a potential expansion that could see the pipeline supply up to 20 bcm of gas.
e group launched market tests last month to gauge interest in this expansion. The first phase of the tests, currently underway, allows
operators to place non-binding bids for the extra capacity. During the second phase, set to begin in the second quarter of next year, o ers will be binding.
e market tests will help pave the way for the TAP group to take a nal investment decision (FID) on the expansion. But they will also need to ensure that enough gas supply is available to ll the pipeline.
e second stage of Azerbaijan’s Shah Deniz gas project is set to provide all the required gas to ll TAP’s initial 10 bcm per year capacity. Were the pipeline to be expanded further, new sources of gas would need to be sought out.
Azerbaijan could potentially provide this gas, but only if a third stage at Shah Deniz is approved, which could take years, or if other new gas elds are exploited. So far, the only other major new Azeri gas eld to have moved beyond the exploration phase is Absheron, although its start-up has been repeatedly delayed.
Outside Azerbaijan, the only country that could realistically provide the extra gas would be Russia. But EU authorities are unlikely to accept this option, as one of the main rationales for TAP and the rest of the Southern Gas Corridor (SGC) pipeline network is to diversify the bloc’s import mix. ™
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w w w . N E W S B A S E . c o m Week 31 07•August•2019