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The Trans Adriatic Pipeline (TAP), which envisages transportation of Azerbaijani gas to Europe, is reacting to the changing world oil prices.

Ian Bradshaw, Managing Director at TAP AG spoke to Trend May 16 regarding the situation on the world oil market and its impact on the project.

"The evolution of the oil and gas price leads us all to look at cost across our operations and with our contractors and sub-contractors," Bradshaw said.

"TAP is no different; we will continue to ensure we execute the TAP project with exemplary cost control," he added.

In more macro terms, the energy industry is a long wavelength one used to oil price cycles and makes investment decisions for the long-term, according to Managing Director.

"As such, our project is underpinned by long-term gas transportation agreements for 25 years, which were agreed and signed by the buyers and shippers of Shah Deniz gas in September 2013," Bradshaw said.

Moreover, he said, TAP project's Board took a Resolution to Construct - effectively the project's Final Investment Decision (FID) - in November 2013.

"This means that TAP's shareholders have formalised their commitment to invest in the construction of the pipeline, and the project is progressing according to schedule," Bradshaw said.

He mentioned that TAP is part of the $45bn Southern Gas Corridor value chain. Bradshaw didn't reveal the project cost, but said that TAP will be in a position to do it once all major contracts are in place.

"While the vast majority of TAP's strategic procurement contracts have now been awarded, a few final tenders - namely SCADA and Fibre Optic Cable - are still in progress of being awarded," Bradshaw said.

TAP project envisages transportation of gas from the Stage 2 of development of Azerbaijan's Shah Deniz gas and condensate field to the EU countries.

The 870-kilometer pipeline will be connected to the Trans Anatolian Pipeline (TANAP) on the Turkish-Greek border, run through Greece, Albania and the Adriatic Sea, before coming ashore in Italy's south.

TAP's shareholding is comprised of BP (20 percent), SOCAR (20 percent), Snam S.p.A. (20 percent), Fluxys (19 percent), Enagás (16 percent) and Axpo (5 percent).

A groundbreaking ceremony for TAP will be held May 17 in Thessaloniki, Greece.

Earlier, the European Bank for Reconstruction and Development (EBRD) managing director of energy Riccardo Puliti said in an interview to Reuters that bank is considering financing of up to 1.5 billion euros for TAP.

"We are considering up to 500 million euros of our own money for TAP plus we will try to arrange with other banks up to 1 billion euros in a syndicated loan," Puliti said.

"Together with financing from the EIB, project sponsors' equity and export credit agencies, I think the (project) will be fully financed," he added.

The 870-kilometer TAP will be connected to the Trans Anatolian Pipeline (TANAP) on the Turkish-Greek border, run through Greece, Albania and the Adriatic Sea, before coming ashore in Italy's south.

TAP's shareholding is comprised of BP (20 percent), SOCAR (20 percent), Snam S.p.A. (20 percent), Fluxys (19 percent), Enagás (16 percent) and Axpo (5 percent).

A groundbreaking ceremony for TAP will be held May 17 in Thessaloniki, Greece.

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