SOCAR confirms plans to enter European gas distribution market
By Gulgiz Dadashova
Azerbaijan's state energy company SOCAR has once again confirmed its plans to enter the gas distribution market of Europe following the selection of Trans Adriatic Pipeline (TAP) project by the Shah Deniz Consortium.
The TAP project is designed to transport gas from the resource-rich Caspian region via Greece and Albania and across the Adriatic Sea to southern Italy and then into Western Europe.
SOCAR President Rovnag Abdullayev said July 1 that the importance of SOCAR's involvement in the privatization of Greek DESFA has increased even more following the decision on the Caspian gas export route.
DESFA is the operator of the Greek national gas transmission system responsible for its development and operation. DESFA is a division of the state gas company DEPA, whose privatization failed in June due to the lack of formal bids including from Russian giant Gazprom, which had been considered the most likely buyer of DEPA.
"Participation in the privatization of DESFA is a commercial project. Acquisition of equity in DESFA opens up great opportunities for SOCAR. Specifically, the Greek company has an LNG terminal which will supply liquefied natural gas to Greece and then ensure the supply of gas to the Balkan countries," Abdullayev said.
Purchase of equity interest in DESFA will allow SOCAR to participate in various investment projects in the Balkan countries and, in particular, to be involved in the process of gas supply in Albania, which is currently at a very low level.
Abdullayev said work is currently underway on preparing a purchase contract with regard to the assets of the Greek company, adding that the process will be completed in several months.
Earlier, SOCAR voiced interest in creating a gas distribution system in Albania, as it is deemed a profitable area for investment.
A senior SOCAR official said that an agreement has been reached with the country's government that SOCAR will work to create the infrastructure and use the underground storage facilities in Albania.
Meanwhile, SOCAR is expanding operations in the retail oil products market abroad.
Socar Turkey Enerji, a subsidiary of SOCAR in Turkey, is considering several options for the acquisition of fuel distribution stations in Turkey.
SOCAR is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in the domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan. Three production divisions, two oil refineries and one gas refinery, an oil tanker fleet, a deep water platform fabrication yard, two trusts, one institution, and 22 subdivisions are operating as corporate entities under SOCAR.
The company owns gas stations in Azerbaijan, Switzerland, Georgia and Ukraine. It has representative offices in Georgia, Turkey, Romania, Austria, Switzerland, Kazakhstan, Britain, Iran, Germany and Ukraine and trading companies in Switzerland, Singapore, Vietnam, Nigeria and other countries.