(MENAFN- AzerNews)
Ulviyya Shahin
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After Ukraine and the EU's current agreement with Russia expires
this year, they have asked Azerbaijan to supply natural gas to
Europe via Ukraine. Azerbaijani President Ilham Aliyev confirmed
ongoing discussions with Ukraine, the EU, and Russia to continue
gas supply. Ukrainian President Volodymyr Zelenskiy aims to secure
Azerbaijani gas to maintain Ukraine's role in gas transit and
support Western energy security. Aliyev noted potential challenges
for Austria and Slovakia if Russian gas via Ukraine stops,
underscoring Azerbaijan's readiness to increase gas exports to
Europe, reaching nearly 13 billion cubic meters this year through
the Southern Gas Corridor.
The international analyst, and author of books on Britain,
Turkiye, and the South Caucasus, Dr. Patrick Walsh's commentary on
Azerbaijani President Ilham Aliyev's speech, emphasizing that there
was an interesting article in the Financial Times of London last
week.
"Vaqif Sadigov, Azerbaijan's ambassador to the EU, told the
newspaper that the EU is currently treating the country as a
“firefighter” by only committing to short-term gas deals despite
asking Azerbaijan to boost exports of fuel to the EU. Baku needs
the certainty of long-term contracts to raise the finance required
to increase gas production in the Caspian Sea and meet the
additional EU demand. Mr Sadigov said that they cannot be a
firefighter just by sending gas for three to six months. They need
the contracts so that they can go to banks for financing for
drilling deep into the Caspian Sea.”
According to international expert, despite discussions with the
EU Commission about how to meet the targets of the 2022 deal to
increase Azerbaijan's annual gas exports to the EU to 20bn cubic
meters by 2027, EU operators have been reluctant to sign long
contracts because of the bloc's ambition to curb its consumption of
fossil fuels and reach net zero greenhouse gas emissions by
2050.
"EU officials have said it is up to companies rather than
national governments to make the commercial agreements. Finding new
sources of natural gas has become critical for the EU since Russia,
the EU's largest supplier, began to shut off gas flows in
retaliation for the EU's support for Ukraine. However the EU has
committed to ambitious climate goals to cut greenhouse gas
emissions by 90 percent by 2040, and fossil fuel consumption should
be 80 percent less than in 2021, of which only 40 percent would be
gas. Matthew Bryza, former US ambassador to Azerbaijan, said that
to reach the EU's 2027 target for Azerbaijani imports, it was
imperative to finance upstream production because Azerbaijan would
not otherwise have sufficient extra gas production to meet the EU
deal. Between January and June, Azerbaijan exported 6.4 bcm of gas
to EU countries, about a quarter of its total production, according
to Baku's figures."
"Over the past three years, Azerbaijan has increased its gas
flows to the EU by 12 percent. However, it seems that Brussels is
unable to finance the project because of its rules that prevent the
EU budget from being spent on fossil fuel infrastructure. The
European Investment Bank has similar restrictions. Ironically this
EU ideology is not only an impediment to its energy security but to
Kyiv, which urges Brussels to make the required commitment to
Azerbaijan's energy supply," Dr. Walsh concluded.
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