Turkmenistan’s Physical Link to Europe

Turkmenistan’s Physical Link to Europe

THE PROJECT

  1. The Project
  2. Energising Europe
  3. Gas Dependence and the Energy Union
  4. Turkmenistan’s Physical Link to Europe
  5. Why Turkmenistan: White Stream as Part of the SGC
  6. Two Entry-points for Guaranteed Offtake
  7. Plan of Work

Construction of the Trans-Anatolian Gas Pipeline (TANAP) is on schedule, even ahead of schedule, to be completed for commissioning at the end of 2020. It will transport natural gas from the Caspian Sea basin to Turkey and Europe. Turkmenistan can be directly connected to this system only through construction an offshore pipeline from Turkmenistan to Azerbaijan across the Caspian Sea (Trans-Caspian Pipeline, TCP). Turkmenistan’s strategic long-term objective is to export available large volumes of gas to the EU. A framework agreement to supply Turkey with gas was already signed in November 2014.

The EU’s interest in Turkmen gas makes White Stream an integral part of the Southern Gas Corridor. The TCP is an offshore pipeline in the Caspian Sea with a length of 300 kilmetres and a currently-planned full capacity of 32 billion cubic metres per year (bcm/y). The TCP will branch off from a connection with the East-West Pipeline (EWP) within Turkmenistan, at the Turkmen shore of the Caspian Sea. It will be connected to Sangachal terminal in Azerbaijan, whence to the expanded South Caucasus Pipeline (SCP) for natural gas. From the SCP, gas can then be transported to Europe via the TANAP-plus-TAP system, then at a later stage through the White Stream. Turkmen gas will thus be linked directly into the European gas grid.

The circumstances for implementing White Stream have never been more favourable and advantageous. Economies in Central and Northern Europe that wish to increase their use gas as an economically justified way to reduce of CO2 emissions and smooth the transition to renewables, would welcome significant volumes of Turkmen gas in order to enhance competition if these are supplied in a timely fashion and via lowest-cost routes.

White Stream Trans-Caspian Pipeline System Map
The White Stream route makes both Turkmen and Azeri gas price-competitive in Central and Northern Europe and other critical markets, because it does not require expensive new infrastructure.

It is essential not to delay the implementation of the requisite infrastructure projects. Although there are no legal barriers to White Stream, obtaining crossing permits in a timely manner will encourage intergovernmental format of negotiations. Coastal states do not have the legal means to prevent construction and operation of White Stream. The existence of Blue Stream (or Turkish Stream in future) is not a legal (or technical) obstacle to White Stream. There are many cases where undersea pipelines cross other pipelines and cables.

It is important to debunk the oft-encountered, misinformed and incorrect view that development of a system to carry 30-40 bcm/y of Turkmen gas to European markets would require installation of major new infrastructure costing many billions of dollars. The argument that expensive new infrastructure is needed, depends upon the assumption that the Turkish route will be used for bringing Turkmen gas to Baumgarten. Not only is the Black Sea route from Georgia more direct than that, however, but also in combination with existing pipelines such as the TBP, it makes the gas much less expensive.

Proven deep-water technology dictates the phased development of the White Stream pipeline project, with two separate strings, each optimally carrying 16 bcm/y. Technical examination of the option for the Black Sea crossing using LNG tankers revealed that the pipeline has very significant commercial advantages for a sufficiently large demand by EU Member States.

Moreover, the trans-Black Sea pipeline option creates, for the producer, a much higher confidence in security of demand, in comparison, for example, with the floating LNG option. That higher security of demand is necessary for success of the Trans-Caspian Pipeline.

The two entry-point option reduces geopolitical risks by diversifying routes and, still more important, reduces cost by bringing Turkmen gas to Central Europe via the White Stream and Trans-Balkan Pipeline (TBP) rather than via Turkey.