Page 5 - FSUOGM Week 23 2022

FSUOGM COMMENTARY FSUOGM

were taken in the near future, it typically takes gas swaps with Iran and Azerbaijan, providing
projects in the area four years to reach the pro- supply for the Azeri market that could free up
duction phase. volumes produced there for export.
Along with Absheron, increased output could
come from the Karabakh and Kapaz oil and gas What next?
fields, as well as the Umid field. But again, this The EU's committed push to phase out Russian
extra supply would take a similar amount of time gas over the coming years is a clear opportunity
to come on stream. for Azerbaijan to expand its own market share
BP is continuing to explore new areas in the on the continent. But it is important not to over-
Caspian Sea, and any discoveries it finds could state how easily the country can achieve this.
also be hooked up to export gas to Europe. The Developing upstream projects anywhere
company and its partner SOCAR completed an takes years, and in the Caspian Sea, some pro-
ultradeep well at the Shafag-Asiman block in the jects have taken considerably longer than else-
Azeri Caspian last year, with SOCAR reporting where, because of logistical issues, complex
a gas and condensate find there. The partners geology and difficult operating conditions. The
also sunk a well at the Shallow Water Absheron ongoing dispute over the sea's legal status does
Peninsula (SWAP) area last year, although the not help matters, and has held up development
result was not revealed, and they began work on of large fields in contested areas, such as Dost-
a second in April. Additional wells are planned. luk, which is claimed by both Azerbaijan and
A more distant prospect is gas supply for Turkmenistan. The pair have begun negotiating
Europe from Turkmenistan. Turkmen authori- a joint development of the field, but there are
ties have been pushing for the construction of a limited signs of concrete progress.
trans-Caspian pipeline that would link with the In the meantime, there are a number of other
SGC system in Azerbaijan for many years. gas supply projects on the cards in southeast
Opposition from Russia and Iran has long Europe. Greece is building a second 5.5 bcm
thwarted the project, as have commercial chal- per year LNG terminal near Alexandroupolis
lenges owing to the length the gas would have and has proposed developing three more with
to travel, as well as Turkmenistan’s obstinacy in capacities of 5.5, 5.2 and 2.5 bcm per year, all due
negotiations with Azerbaijan. However, Azer- up and running in 2023. Albania is looking to
baijan and Turkmenistan are now in talks on become an LNG importer with the construc-
building a scaled-down pipeline only 78 km in tion of a terminal in Vlora, and there is also the
length that would send 5 bcm per year of gas EastMed pipeline to consider, which could carry
from the offshore Magtymguly field to Azer- 10, or possibly 20 bcm per year of gas to Europe
baijan. Turkmenistan could also expand land from fields off the shores of Israel and Cyprus. ™

Week 23 08•June•2022 www. NEWSBASE .com P5