Bids unveiled for gas pipeline linking Turkey and Greece

ANKARA (Combined reports) – Turkish state natural gas and pipeline concern Botas yesterday unveiled bids for engineering work on a $300-million natural gas pipeline between Turkey and Greece. France’s Sofregaz submitted the lowest bid at $4.55 million to conduct work on the 285-kilmeter (177-mile) pipeline which will stretch from the western Turkish city of Bursa to Komotini in Greece, Botas officials said. Of the total pipeline, 200 kilometers will be laid in Turkey and the rest in Greece. The pipeline is due to pump 500 million cubic meters of natural gas to Greece from 2005, according to a memorandum of understanding signed between the two countries in late March. Analysts have said Turkey’s gas contracts with Russia and Iran exceed its needs and have resulted in a supply glut. A deep economic recession last year cut consumption even further below the previous estimates on which gas import contracts were based. Turkey has contracted to buy at least 21 billion cubic meters (bcm) of gas from Russia, Iran, Algeria and Nigeria this year, though it expects to consume 20 bcm. About 85 percent of Turkey’s gas purchases are subject to a take-or-pay clause under which Ankara has to pay for the gas whether it imports or not. To avoid the clause, Turkey recently secured a 9 percent reduction in the Russian gas price and halved the amount from a second pipeline link, the Blue Stream project, to 2 bcm for 2003. In another project announced at yesterday’s meeting, German ILF engineering group submitted the lowest bid at $5.29 million to carry out engineering work on the Turkish section of the Azerbaijan Shakh Deniz project, Botas said. The BP-led Shakh Deniz project, estimated at costing $3.2 billion, aims to link the giant Shakh Deniz fields in Azerbaijan to Turkey by 2005 through a pipeline in a bid to carry Caspian natural gas to European markets. Turkey’s energy minister welded two pipes together Sunday to finish construction of the world’s deepest undersea gas pipeline that will bring Russian gas to Turkey under the Black Sea, news reports said. The 360-kilometer (216-mile) underwater segment of the 446-kilometer (278-mile) dual pipeline was laid at a record depth of 2,100 meters (7,000 feet) below the surface of the Black Sea by Italy’s Saipem engineering company. Energy Minister Zeki Cakan welded the end of the pipeline, stretching from the Russian port of Dzhubga to Turkey’s Black Sea port of Samsun, to a separate 501-kilometer (313-mile) pipeline running from Samsun to the capital Ankara, the Anatolia news agency said. The line, called Blue Stream, is expected to begin test deliveries of natural gas to Turkey within a month. Turkey plans to start receiving an annual 3 billion cubic meters (105 billion cubic feet) of natural gas in 2003. The volume will increase to an annual 16 billion cubic meters (560 billion cubic feet) in 2008. Turkey says the pipeline, which cost $3.2 billion, will meet its expanding energy needs. Turkey will need up to 55 billion cubic meters (1.925 trillion cubic feet) a year by 2010, analysts say. Blue Stream has come under fire in Turkey amid allegations of corruption. Critics say the project will increase Turkey’s reliance on Russian natural gas, and point out that no tender was offered in Turkey for the project. (Reuters, AP)