Economy

Azerbaijan's natural gas network unable to compensate for lost Russian supplies

Azerbaijan gas exports that could stretch to 31 bcm with major investments fall short of replacing EU's annual imports of 155 bcm from Russia

Sibel Morrow  | 18.07.2022 - Update : 18.07.2022
Azerbaijan's natural gas network unable to compensate for lost Russian supplies

By Sibel Morrow

ANKARA (AA) - The EU’s pivot to Azerbaijan in a bid to find alternative natural gas sources in anticipation of further declines in Russian gas falls short of enabling the needed supplies in the short term, according to recent data on supply flow from Azerbaijan.

Accusing Russia of weaponizing its energy supplies, the European Commission (EC) said “diversification of our energy imports is a priority for the EU.”

In a Twitter post on Sunday, the EC announced a meeting with the EC President Ursula von der Leyen and Energy Commissioner Kadri Simson in Azerbaijan later on Monday to further strengthen cooperation and address the possibility of acquiring more natural gas from Azerbaijan.

Azerbaijan produced 43.9 billion cubic meters (bcm) of natural gas last year, according to data compiled by the International Energy Agency, Azerbaijan’s Energy Ministry and bp.

Last year, the country exported 18.9 bcm of natural gas, including 8.5 bcm to Türkiye and 8.2 bcm to Europe, via the Trans-Adriatic Pipeline (TAP), a European section of the Southern Gas Corridor, data from the ministry shows.

Azerbaijani President Ilham Aliyev confirmed in February that the remaining natural gas was distributed to European countries like Bulgaria and Georgia.

Azerbaijan, with its 1.3 trillion cubic meters of natural gas reserves, requires further investments to enlarge its natural gas production and pipeline capacity expansion.

Even if the necessary investments are made to expand capacity by maximizing financial opportunities, extra protocols and agreements are still required.

Additionally, even if investments are made and pipeline capacity expansions are realized, Azerbaijan must dramatically boost its natural gas production to be able to meet Europe’s needs.

Europe wants to enhance capacity in the Southern Gas Corridor, and it is technically possible to increase capacity via TAP from 10 bcm to 20 bcm.

Nonetheless, if the import level from TAP doubles to 20 bcm to the EU, it still falls short of the 155 bcm that Russia was supplying to the EU on an annual basis.

Similarly, the capacity via the Trans-Anatolian Natural Gas Pipeline (TANAP), a central part of the Southern Gas Corridor, can only increase from 16 bcm to 24 bcm and ultimately to 31 bcm with much-needed investment within the next five years.

The 182-kilometer Interconnector Greece Bulgaria (IGB) pipeline, transferring Azerbaijan’s gas to Europe, was completed on July 8, but the capacity is insufficient to substitute Russian natural gas exports.


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