Page 46 - bne magazine September 2020 russia melting

46 I Eurasia bne September 2020
Russia
Kashagan natural gas field
Kazakhstan
Uzbekistan
Despite grand idea, the TCP has been going nowhere for years.
Daunting challenges lie in way of those minded to revive Trans-Caspian Pipeline project
bne IntelIiNews
"Daunting” challenges lie in the way of those minded to
revive the Trans-Caspian Pipeline (TCP) project that would
deliver Turkmen gas to European Union states via Azerbaijan, Georgia and Turkey, according to a senior fellow in the Global Energy Center writing for The Atlantic Council think tank.
Addressing the question as to whether the project is “still a pipe dream”, Daniel Stein noted the impending completion of the Southern Gas Corridor (SGC) – designed to deliver Azerbaijani gas as far as Italy – has led to renewed interest in TCP.
Wrote Stein: “The SGC will soon be fully operational, delivering 10 billion cubic
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meters per annum (bcma) of natural
gas from Azerbaijan’s Shah Deniz gas field to customers in Southeast Europe. However, while the SGC will advance energy diversification, its impact will
be limited by the relatively small volume of gas it will deliver – 10 bcma into
a European market of 450-500 bcma. That is why the United States and the EU have long promoted the concept of a 30 bcma TCP, which would provide access to Turkmenistan’s prolific gas fields.”
Stein observed that a Center for Strategic and International Studies (CSIS) article argues that there are four critical ingredients for successful transnational pipelines, namely a dedicated source
of oil or gas, a competent commercial champion, favourable economics and political support.
How does it stack up?
He continued: “How does TCP stack up against these four critical elements? First of all, there is no dedicated source of gas. Turkmenistan has huge gas reserves, but while production at its newer gas fields has increased in recent years, the bulk of it is committed to China under long-term contracts. The production capacity at older fields, which previously supplied Russia, is unclear and it is safe to assume their capacity has been reduced. Therefore, a new source of gas would have to be developed to supply TCP.
Possible route
Original route