High-level meeting: AGRI project – steps towards implementation

The feasibility study for the AGRI project (Azerbaijan-Georgia-Romania Interconnector), recently presented in Bucharest, considers two viable operational options for three different capacities of two, five or eight billion cubic meters of natural gas. The costs are estimated to EUR 2-5 billion. The positions of participating countries regarding the implementation of the project, the final outcome of the feasibility study and the project’s funding possibilities were discussed during a meeting held on June 24 in Bucharest, attended by senior officials of the States participating in the project.

Andrei Gerea“The findings of this study show that we have two viable working options for two different capacities of five billion and eight billion cubic meters. These figures can also be improved and in light of the discussions (...) we decided to continue the project’s development on the technical basis that would enable further development and the increase of capacity if needed. We believe that the AGRI project is part of the southern gas corridor that can bring an important contribution to the European energy security,” said Andrei Dominic Gerea, Minister of Energy, Small and Medium Enterprises and Business Environment, at the end of the meeting attended by the representatives of Georgia, Azerbaijan, Hungary, the European Commission, also by companies involved in the project, etc.

The Romanian Minister of Energy underscored that funding sources should be found for this project, and other participants should be invited. In this regard, the official said that he has had discussions with the Energy Ministers from Bulgaria and Serbia last month, who have expressed interest in the project.

According to the Romanian Minister of Energy, the project costs will amount to about EUR 1 billion for the Romanian side. The Azerbaijani Minister of Energy, Natig Aliyev, said the calculations were made for three natural gas capacities, for two billion cubic meters, five billion cubic meters and eight billion cubic meters, and the costs vary between two and five billion euros.

Statement to support the project

At the end of the meeting, the Azeri and Romanian Ministers of Energy, as well as the Deputy Minister of Energy and Natural Resources of Georgia, Mariam Valishvili, signed on June 24, in Bucharest, the Joint Declaration of the Inter-ministerial Meeting about the AGRI project.

Agri 2The project aims to transport gas from the Caspian region through the territory of Azerbaijan and Georgia, cross the Black Sea by methane carrier vessels, which involves the construction of two liquefaction terminals (on the Georgian Black Sea coast) and re-gasification (on the Romanian Black Sea coast). Gas volumes are intended primarily to ensure the consumption of Romania and Hungary, the rest being directed to other potential markets in Europe, highlighted in the Feasibility Study. Also during the meeting, which included various working sessions, extensive discussions were held on issues related to the project’s future, its implementation and the potential role in the region’s energy security. Joe Murphy, BP Vice President for Azerbaijan-Georgia-Turkey (AGT) Region, Southern Corridor, stressed that the AGRI project should be considered an additional component of the Southern Gas Corridor and that legal documents, technical and economic information between participating countries, should be drawn to ensure the effective implementation of this project.

Since the last ministerial meeting, which was also held in Bucharest in May 2011, the AGRI project has made significant progress. Besides completing the feasibility study, efforts were made to promote this project to the European Union, efforts which have resulted in including the project on the list of projects of common interest that will be completed later this year.

The AGRI project was initiated in 2010 through a memorandum signed in Bucharest between Romania, Azerbaijan and Georgia, later joined by Hungary.

Serbia, invited to join the project

Following the meeting in Belgrade between the Romanian and Serbian energy ministers in late June, the two officials announced that their countries would work together to develop regional interconnection of natural gas transport to enhance energy security. Serbian Minister of Energy and Mining Aleksandar Antić said in Belgrade that the AGRI project would provide extra gas to the Western Balkans and thus provide new sources of supply for Serbia, international media informed. Serbia needs about two billion cubic meters of gas per year, having an output of only about 20% of this volume. The rest is imported from Russia, through Ukraine and Hungary. In early June, Serbia and Bulgaria signed an agreement on gas interconnection of their networks, which should ensure diversification of supply for Serbia.

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July/August 2015

June 2017