ITAR-TASS: Nabucco may be cancelled by the end of June

The project of the Nabucco pipeline may be cancelled by the end of June, sources from the London business environment claim, according to Russian press agency ITAR-TASS. According to focus-fen.net, the initial implementation schedule stipulated that Nabucco would become functional in 2014, with gas from Azerbaijan. But the experts have questioned the reliability of the project.

Contacted by BURSA, the representatives of Nabucco declined to comment these rumors.

Oil giant BP has disqualified the Nabucco pipeline as a delivery route for natural gas extracted from Azerbaidjan - the Shah Deniz II deposit. Thus, the European Union needs to reconsider the project and to abandon it, sources from the London business environment consider. Several energy experts claim that the failure of Nabucco was caused by the shift in the natural gas market, where many countries are beginning to rely on liquefied natural gas and shale gas.

Reuters recently announced that BP is no longer considering the delivery of gas from the Shah Deniz II deposit through the Nabucco pipeline and is forcing the EU to present a smaller version of the project. The competitor of Nabucco for the Azeri gas of Shah Deniz is the SEEP pipeline.

The Nabucco consortium recently submitted to the Shah Deniz II consortium, led by BP, a proposal for the building of gas pipeline called "Nabucco Vest", which is set to ship natural gas coming from the Caspian region, starting with the border of Bulgaria and Turkey to Baumgarten and further. "We are convinced that we have submitted to the Shah Deniz II consortium a competitive and comprehensive proposal, and that it represents a beneficial solution for our shareholders as well as for our suppliers", Reinhard Mitschek, the managing director of "Nabucco Gas Pipeline International" recently said.

Nabucco Vest represents a revised concept of the Nabucco project. The concept provides the building of a gas pipeline with a length of 1,300 km which will begin at the border of Bulgaria and Turkey to the Central European gas terminal.

Nabucco Vest will have the same legal framework as the core Nabucco concept, namely the Intergovernment agreement, the Support Agreements of the project, and derogations from the access of third parties, and will have the same route across the territory of the European Union. The other half of Nabucco will be built by Azerbaijan and Turkey, which, some analysts say, will impose their own terms (of pricing and transit fees) before giving the gas over to Nabucco Vest.

The Nabucco project was dealt one blow after another after the competition for the gas of Shah Deniz II picked up, and Gazprom also "toured" Europe strengthening the partnerships for the rival project South Stream. MOL Hungary recently announced that it did not want to finance Nabucco any longer and that it intends to finance its stake in it, opting instead to reinforce its partnership with South Stream, the gas pipeline pushed by Russia. RWE has also announced that it is rethinking its position on Nabucco.