BAKU, Azerbaijan, June 17
By Leman Zeynalova – Trend:
Full-scale launch of the Southern Gas Corridor will positively impact Azerbaijan’s economy, the Asian Development Bank (ADB) told Trend.
“ADB is proud to be the first international financial institution who approved it share of SGC’s financing. The full-scale launch of SGC will have the positive impact to the country’s economy. Per ADB’s procedures we would be able to measure the project’s impact one year after its completion, and not only from economical consideration,” said the bank.
One of ADB’s mandate is the development of regional cooperation and integration among its members.
“We consider that this project has an intraregional significance. With this project Azerbaijan is unleashing its abundant economic opportunities and strengthening close ties with other ADB members - Georgia, Turkey and several European countries. As such ADB is pleased that this project is a perfect match of both as it promotes regional cooperation and supports several ADB members with strengthening their energy security through diversification of import sources for their gas consumptions,” said ADB.
The bank said that this project has also social importance as it has provided over 200 permanent jobs in the country.
“With additional revenues from the project the government can expand social programs and accelerate implementation of additional measures towards economic diversification,” said ADB.
Southern Gas Corridor CJSC has inked two agreements with the Asian Development Bank. One of the agreements envisages a guarantee for attracting $524.5 million, which was fully utilized by the CJSC. The second agreement for allocation of $500 million worth loan was annulled as a result of project cost reduction.
The Southern Gas Corridor comprises the following four projects: (i) operation of Shah Deniz natural gas-condensate field ("SD1" project) and its full-field development ("SD2'" project), (ii) the operation of the South Caucasus Pipeline ("SCP" project) and its expansion ("SCPX" project), (iii) the construction of the Trans-Anatolian Natural Gas Pipeline ("TANAP" project) and (iv) the construction of the Trans Adriatic Pipeline ("TAP" project) (SD2, SCPX, TANAP and TAP collectively, the "Projects").
The Projects have an estimated investment cost of approximately $40 billion. Upon completion, the SD2 project will add a further 16 bcm of natural gas per annum to 10.9 bcma (maximum production capacity) already produced under SD1 project.
Total length of the newly constructed SCPX, TANAP and TAP pipelines will be more than 3,200 kilometres.
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