Greek Pipeline Breakthrough To Challenge Russian Gas Dominance In Europe

Tyler Durden's picture

Submitted by Nick Cunningham of Oilprice.com

Greek Pipeline Breakthrough To Challenge Russian Gas Dominance

After years of debate, political jockeying and acrimony, a major pipeline project to bring natural gas to Southern Europe has broken ground.

The Trans-Adriatic Pipeline (TAP) will connect the Caspian Sea to European markets, providing Europe with another large source of natural gas that will help the continent diversify away from Russia. The route begins at the Caspian Sea in Azerbaijan, where the South Caucuses Pipeline will carry Caspian gas from the large Shah Deniz-2 gas field, delivering it to the border with Turkey. From Turkey the gas will tie into the Trans Anatolian Pipeline (TANAP), which will take the gas across Turkey to the border with Greece where it will meet up with the aforementioned Trans-Adriatic Pipeline. The Caspian gas will then travel through TAP across Greece, beneath the Adriatic Sea and onto Italy.

South Caucuses Pipeline to TANAP to TAP

The TAP route

The pipeline projects are part of what is often referred to as the “Southern Corridor” for European gas. For years Europe has pressed for a gas pipeline through the southern corridor that would offer it an alternative to Russian gas. But TAP was not always an inevitability – before the consortium of companies took up the project, the European Union favored the Nabucco Pipeline, which instead of sending Caspian gas to Italy, would have resulted in a pipeline snaking its way through the Balkans to Central Europe

And back when Nabucco was in vogue, Russia pushed hard for its own route through Southern Europe. The so-called South Stream Pipeline would have sent Russian gas beneath the Black Sea to Bulgaria. European regulators worked hard to derail that pipeline on anti-competition grounds. Shortly after the death of South Stream, and following in the wake of Russia’s standoff with Europe over its incursion into Ukraine, Russia pushed the “Turkish Stream” project, which would have sent Russian gas to Turkey and then onto Southern Europe. But the project was more of an idea than a reality, and due to a set of differences between Russia and Turkey, not the least of which was the cost of the pipeline and how it would be paid for, the project never really went anywhere.

The complexity of pipeline politics and the web of pipeline routes can be confusing, but suffice it to say the Turkish-Greece-Italy route has won out, through the TANAP and TAP pipelines. On May 17, TAP broke ground in Thessaloniki, Greece. Construction will take several years, but when the $45 billion project is completed in 2020, it will deliver 10 billion cubic meters per year of natural gas from the Caspian Sea to Europe.

Greek Prime Minister Alexis Tsipras was in attendance for the groundbreaking event, as were top officials from Georgia, Azerbaijan, Albania, the EU and even the U.S. State Department. Each have their own reasons for supporting the project. The project developers – BP, the Azerbaijan state-owned oil company SOCAR, and others – obviously have direct profit motives in mind. The national governments see economic opportunities through construction and transit fees. For Greece, in particular, the EU sees TAP as providing an economic stimulus to the indebted nation at a time when debt negotiations continue to torment both sides.

From the perspective of the U.S. government, TAP will reduce Europe’s dependence on and vulnerability to Russia; in essence, it is a major geopolitical victory. U.S. Secretary of State John Kerry, in a congratulatory letter to Greece’s Prime Minister, said that TAP is a “prime example of infrastructure that enhances European energy security.”

Diversity of supply has become one of Europe’s key energy security objectives, along with building an “energy union” between EU member states.

“A single European energy market will allow us to increase our security of supply by allowing energy to flow freely across our borders,” European Commission Vice President for Energy Union Maros Sefovi said at the ceremony. “It will allow us to better negotiate with our external partners, given that the EU is the largest energy importer in the world.”

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giovanni_f's picture

Actually it is 'cui bono' but he confused it with 'quo vadis' anyway

eforce's picture

Russia just needs to let the Caspian conflict boil over and that should sort it out.

giovanni_f's picture

The list of attendees of the opening ceremony reads like the who's who of a trans-europe, trans-balkan, trans-caucasus Mafia:

"The significance of TAP as a strategic piece of the Southern Gas Corridor infrastructure, which will bring initial volumes of gas from Azerbaijan to Europe, was underlined by the presence of the Prime Minister of Georgia Georgi Kvirikashvili, the First Deputy Prime Minister of Azerbaijan Yaqub Eyyubov, the Deputy Prime Minister of Albania Niko Peleshi, the EU Vice President for Energy Union Maroš Šef?ovi?, the US Special Envoy and Coordinator for International Energy Amos Hochstein, the Minister of Energy of Turkey Berat Albayrak, the Minister of Economic Development of Italy Carlo Calenda, the Minister of Energy of Bulgaria Temenuzhka Petkova, as well as the Switzerland State Secretary Federal Office of Energy Walter Steinmann"

Shemp 4 Victory's picture

Yeah, I noticed Nick Cunningham studiously avoided mentioning Georgia through this article. He also can't even copy and paste a correct spelling of Caucasus. Just another shill for a well connected mob.

BTW, funny that a Greek pipeline deal would emerge just as US Ambassador to Ukraine Geoff Pyatt is being made US Ambassador to Greece.

Attention Greek citizens: beware of Madame Cookie.

Boris Alatovkrap's picture

This is never happen, pipe is just dream.

HowdyDoody's picture

I suspect the pipeline will not be ISIS-proof (and deliberately so). That then opens the route to a level of blackmail that makes the Ukraine oligarchs look like honest brokers.

Europe - who do you trust US/Turdkey or Russia? Hint, how are the negotiations over the migrant crisis (induced by US/Turdkey) going?

 

 

Morbid's picture

yeah dealing with crooks would rarely get you a long stick out of the deal. there have been lots of projects proposed in the last few years but most of them barely materialised outside political realm.. i doubt any side would find enough fools to invest into a long term project when we are heading towards some grand volatility across all spheres.

HenryHall's picture

Pipeline across Georgia? rofl!

You would have more success with a pipeline across Somalia.

Not to mention Azerbaijan switches allegiances every few years.

And what happens when Golden Dawn or the Communists take power in Greece?

Still, it's a good project, it won't ever complete as planned but it's still a good project to spend EU money on.

SimplePrinciple's picture

The EU must have competition, no MATTER the cost.  Funny, though, here I was thinking the point of competiton was to bring costs down.  Silly me.

Kirk2NCC1701's picture

When Iran and China were negotiating with the Taliban, to run a pipeline through Afghanistan, the US solved the problem with 9/11.

All that Russia needs to do, is to have their own 9/11 moment, blame the Georgian and Azerbaijani Terrorists, and prosecute them in a "War on Terror".

Result: "No gas for you!"

Czech mate!  ;-)

Morbid's picture

not to mention narrow corridor that georgians have in the middle of their country, thanks to south ossetians receiving russian passports as georgians lost their cridibility after 08/08. they obviously have to thank saakashvili clown for whoring about with american foreign policy taking mouthful of that load, swallowing. so ossetians now with the help of russians can snip away the only motorway that is joining mainland georgia with mengrels, adjars and few more. abkhazians are already alighned with kremlin. basically this doesnt sound like a risk free deal for them..

Déjà view's picture
Greek Pipeline Breakthrough To Challenge 'Institutions' Dominance In Europe?
SWRichmond's picture

So in order to get "cheaper" gas from a non-Russiona source, EU is going to support (Turkey, and thus) Erdogan's Islamic destruction of Europe?

Sweet.

Pieter Bruegel the Elder's picture

Anything for America! Even the destruction of its minions will not be barred.

Hubbs's picture

Well,if there were obstacles through the " Greek passage" then the EU financial blackmail of Greece might make some sense.

Or was the pipeline Greece's ace in (up) the hole to negotiate debt relief?

BlindMonkey's picture

"Qui bono?"

 

Exactly.  Can we assume that the Turks and Greeks have kissed and made up?  LOL.  I will believe it when I see Italian stoves burning Azeri gas.

NoDebt's picture

Can they liquify refugees and put them through the pipeline?  Those Muzzies will do anything to get into Europe.

oddjob's picture

Ths savings on Mercaptan would be huge.

Déjà view's picture

No, Greece will turn off gas when EU threatens to withhold further 'liquidity'.

Vlad you did it again...LOL!

philipat's picture

That's why Russia has recently focused on the "Nordstream" route via Germany to double capacity to Europe. And will accept payment only in RUB. Or, in the case of China, CNY. Check.

CuttingEdge's picture

And Turkey will turn off the gas any time Erdogan wants to ship more ragheads east.

This made my day:

‘There was a young fellow from Ankara

'Who was a terrific wanker

'Till he sowed his wild oats

'With the help of a goat

'But he didn’t even stop to thankera’

By Boris Johnson - hopefully the UK's next Prime Minister (and maybe first politically incorrect one).

 

Full story: http://www.dailymail.co.uk/news/article-3598672/Boris-Johnson-wins-1-000...

HowdyDoody's picture

Boris 'Banskter Butt Boy' Johnson for PM? That's what the UK needs. More TLC for the banksters.

Whalley World's picture

system needs more liquidity

SpanishGoop's picture

Well, i can only say "good luck with that project" when Turkey is involved.

Invest ? no not anytime soon.

 

TuPhat's picture

It could only be economically feasible with negative interest rates and government kickbacks.  Another step into the quagmire.

BobEore's picture

Bingo!

Construction will take several years, but when the $45 billion project is completed in 2020, it will deliver 10 billion cubic meters per year of natural gas from the Caspian Sea to Europe.

This project is a pipe dream - in every sense of the word. The rush to be seen as breaking ground now is in order to give the impression that the wheels have not already fallen off. It's a macro version of "General" Jim Sinclair's efforts to pretend that the hole in the ground in Tanzania he made with OP's $ has some kind of precious metal inside.

The project requires a geopolitical stability which is at odds with the reality of the big player's intentions for the region. The big players, in this case, being the lil terror state in the midst of palestinian property.

Already leveraging their outsized gas deposits in the Med as bargaining chips with the Europeans, Israeli bigwigs have been flying back and forth from Athens and Ankara - making completely contradictary and self-nullifying 'promises' to both enemies - while quietly making sure that each is aware of the other's capacity to screw up the plans they make.

Cyprus is the main battlefield in this war of words. The fields there cannot and will not be developed unless some kind of entente is arranged - and Tel Aviv is the only party who can arrange that. If Ankara's balks at any of their demands, the extortionist will run a gas line right from Leviathan through Greek Cyprus and Italy. If Athens attempts to resist the same shake down, a pipeline can easily be built to Ceyhan port, and Greek Cyrprus cut out of the action.

Everyone east of Azerbeijan will be waiting a long long time for this imaginary plan to manifest in the real world. Russia knows it, Iran knows it, only foolish politicians and desperate, wouldbe Caliphs can pretend otherwise. Just as Iraqi Kurdistan's petrol exports are already firmly in the hands of the usual suspects so the resources of Central Asia are being sequesterd by the Kabbalist Krew. Which wishes a destablized and divided Turkey, along the lines of Iraq/Syria.

Good luck with guarding long lengths of pipeline through underpopulated areas. PKK got your number. As stated previously, the Yinan Plan does not require any territorial expansion of the tiny terror state. Their shadowy footprint grow stronger throughout Europe and the ME by the month. 

BlindMonkey's picture

Who's national treasury is going to be backstopping the bank's money?

cheech_wizard's picture

Bullwinkle: Watch me put a pipeline through Turkey and Greece.

Rocky: Again?

Bullwinkle: No doubt about it, I have to find another route.

SpanishGoop's picture

"From Turkey the gas will tie into the Trans Anatolian Pipeline (TANAP), which will take the gas across Turkey"

And around 50% into EPTAP, Erdogans Private Tap.

 

gdpetti's picture

WHich is the main problem, as Erdo the Idiot is living on borrowed time as it is, and won't be around to see this project completed, but then it's all for show anyway given the trajectory of our global economy, right?

SpanishGoop's picture

But he will be the ruler of Turkey until his death.

Visa free travel in Europe for every Turk and now also free gas for every Turk.

 

Reelection, public opion, reelection,blackmail,reelection.

Turkey in a nutshell.

 

nibiru's picture

The diversity of supply but the NS2 is still an ongoing thing, right? It's just a bunch of egoistic interest that is at play in the EU. don't believe it has anything to do with the Energy Union. On top of that the only way it can go through is when Turkey will push for it as a collateral to EU giving Turkey their visas

Because more migrants in Europe is of course a good thing... /s 

BorisTheBlade's picture

Construction will take several years, but when the $45 billion project is completed in 2020, it will deliver 10 billion cubic meters per year of natural gas from the Caspian Sea to Europe.

From the perspective of the U.S. government, TAP will reduce Europe’s dependence on and vulnerability to Russia; in essence, it is a major geopolitical victory.

Job well done I guess, except minor detail: South Stream was supposed to have 63 billion cubic meters per year and would would definitely cost less than $45 bln.

SpanishGoop's picture

Details, details.

You are not thinking "geopolitical".

 

Bankster Kibble's picture

Good thing for the Northern European countries that Russia is building the second Nord Stream pipeline to Germany.  They will need all they can get.

Sandmann's picture

particularly since energy costs are higher in Eastern Germany than Western Germany

css1971's picture

 

"Gazprom Export supplied 158.56 billion cubic meters of gas to European ... European market - http://www.gazpromexport.ru/en/statistics/"

 

LOL.

 

Someone wants what? Praise? A pat on the back? A bonus or something for 10 billion cubic meters per year?

 

Might as well not bother.

Shemp 4 Victory's picture

That's why everyone hates mathematics, especially US-controlled propagandists. These are the same shills that tell everyone how LNG import terminals and North American natural gas are going to save Europe from the horrible energy tyrant (and reliable supplier at fair prices) Russia.

They never mention that there aren't enough transport ships, by several orders of magnitude. According to wikipedia (yeah, I know, but it was convenient), there are 359 LNG ships involved in deep sea transport. Japan, Taiwan, and South Korea make up two thirds of the purchases of LNG. That leaves about 120 ships available for the rest of the world.

Even if these 120 ships were the largest available, and they're not, it would take 4 of them to move 1 million cubic meters of regasified natural gas. To move even the meager amount of 1 billion cubic meters would require 4000 ocean crossings of the world's largest LNG carrier ships.

Even if there were the capital available to build enough ships (there's not), the LNG import terminal in Poland has an annual capacity of only 5 billion cubic meters and the one in Lithuania can only handle 4 billion cubic meters.

So yeah, keep drinking the Vichy DC Kool-Aid, Europeans - it's nice and cold.

BorisTheBlade's picture

Arithmetics will be banned in Europe as non-Sharia compliant.

Zwelgje's picture

Oh please, the dumbing down of Europe started way before all thid mass 'immigration'.

Son of Captain Nemo's picture

Isn't this wonderful news!!!!

This means that announcement(s) like this one for ratcheting up towards nuclear confrontation with Russia by NATO will be prevented and that the United States won't be needing to destroy the rest of Eastern Europe or for that matter, Syria, Libya or Iraq and can salvage and send it's military resources home which it can no longer afford because it is hopelessly bankrupt with no means for EVER paying off it's liabilities!!!

Oh... Scratch that observation!...

Forgot the part about World domination being the only thing left bringing the Anglo-Zionist cabal to it's knees and end!!!

After all...

The U.S. can't have a major nuclear superpower in Eastern Europe parading itself as an honest broker with real currency that has all the attributes of a store of value that $22 trillion and counting will never match?!!!!

monk27's picture

You cannot have "world domination" with a bankrupt economy. That's the problem US has right now, its foreign policy ambitions have no support whatsoever in its economic realities...

Son of Captain Nemo's picture

You cannot have "world domination" with a bankrupt economy. That's the problem US has right now, its foreign policy ambitions have no support whatsoever in its economic realities...

To your point and how truly clinically insane the U.S. is. ...

When "push comes to shove" and we decide to start the inevitable once everyone in the "NATO alliance" gets on board with the program voluntarily or through another planned 9/11 moment by the Anglo-Zionist contingent -here is a great read on what not to expect!

ft65's picture

Wonder who they'll be buying the steel from?