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Europe’s expenses for the purchase of Azerbaijani gas

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The expenses of the EU countries (EU) for the purchase of gas from Azerbaijan, supplied via the Trans-Adriatic gas pipeline (TAP), in the first quarter of 2022 amounted to 2.1 billion euros, the quarterly report of the European Commission (EC) on the situation in the European gas market.

It should be noted that in January-March of this year, Azerbaijan supplied 2.6 bcm of gas to European markets.

The report states that in the first quarter, the EU spent about 78 billion euros on gas imports, of which 26.5 billion euros – gas from Russia, 19.2 billion euros – from Norway, 5.4 billion euros  – from North Africa ( Algeria and Libya), 2.1 billion euros – via TAP. In the first quarter of  2022, the EU imported LNG (including supplies of liquefied natural gas from Russia, Norway and North Africa),  amounting about 33 billion euros.

The EC notes an increase in gas supplies from Azerbaijan over the year: approximately 24 TWh in the first quarter of 2022 against 10 TWh in the same period last year.

According to the report, in the first quarter of this year, the share of gas supplies via TAP amounted to 2.5% of total supplies against 1.2% a year earlier.

The authors of the report note the competitiveness of Azerbaijani gas, associated with long-term contracts, the price of gas, which is lower than spot prices.

Azerbaijani gas supplies via the TAP gas pipeline to consumers in Italy, Greece and Bulgaria began on December 31, 2020.

In 2021, Azerbaijan exported 8.2 bcm of gas to Europe, in the first quarter of 2022 – 2.6 bcm of gas. In 2022, gas exports to Europe are forecast to exceed 10 bcm.

According to the Turan agency, in January-March 2022, Europe imported Azerbaijani gas at an average price of 807.69 euros per 1,000 cubic meters.

The total length of TAP is 878 km, of which 550 km passes through the northern part of Greece, 215 km through the territory of Albania, 105 km through the Adriatic Sea and 8 km through the territory of Italy. TAP is the last component of the SGC project – infrastructure for the supply of Azerbaijani gas to Europe.

The gas pipeline is designed to transport 10 bcm of natural gas per year from the “Shah Deniz” field as part of Stage 2 of its development to Europe. The throughput capacity of the gas pipeline makes it possible to double its capacity – up to 20 bcm per year. TAP’s shareholders are: SOCAR (20%), BP (20%), Snam (20%), Fluxys (19%), Enagas (16%) and Axpo (5%).

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