Turkey says to build gas pipeline to Azeri exclave

Aug 9 2009

Turkey says to build gas pipeline to Azeri exclave

Sun Aug 9, 2009 4:42pm IST

ISTANBUL, Aug 9 (Reuters) – Turkey has agreed to build a natural gas
pipeline from its eastern border to Azerbaijan’s Autonomous Republic
of Nakhchivan, state-run news agency Anatolian reported on Sunday.
Turkey has been in high-level talks over the price and volume of gas
it receives from major regional gas exporter Azerbaijan. Disputes over
the price Turkey pays for Azeri gas has been a source of tension
between the two traditional allies.

"We will sign a memorandum of understanding for (a pipeline with the
capacity of) almost a half billion cubic metres of gas a year," said
Turkish Energy Minister Taner Yildiz during a trip to Nakhchivan over
the weekend.

Nakhchivan, from which Azerbaijan’s ruling Aliyev family hails, has
suffered under an economic blockade from arch-enemy Armenia, which
geographically separates the Azeri exclave from Azerbaijan
proper. [ID:nLH171801]

Turkey buys 6 billion cubic metres of gas from Azerbaijan’s Shakh
Deniz basin each year at $120 per 1,000 cubic metres, which is far
below what it pays for Russian and Iranian gas.

Prime Minister Tayyip Erdogan said earlier this year that a new gas
price to be negotiated between Turkish and Azeri officials would be
more "fair".

The planned Turkish-Azeri pipeline will run from Turkey’s eastern
province of Igdir to the autonomous republic.

No timeline for the construction of the pipeline was given, but
Turkish state pipeline company BOTAS and Azeri state-owned oil company
SOCAR would hold talks on the commercial and technical aspects of the
line, Anatolian reported. (Reporting by Thomas Grove; Editing by Mike