The Trans Adriatic Pipeline, the Mediterranean and the new energy networks

By Domenico Letizia

2017 begins with good news for the shareholders of the Trans Adriatic Pipeline (TAP) Consortium: in fact, the total balance for the Pipeline will be lower than expected, approximately 4.5 billion euros, much less than the previously estimated 5-6 billion. A good sign, especially for Italian entrepreneurs and investors, who will pay special attention to the construction works of the final section of the Pipeline between Azerbaijan and Italy, through the so-called Southern Corridor.

The TAP will depart near Kipoi, on the border between Greece and Turkey, where it will connect itself with the Trans Anatolian Pipeline (TANAP). Then, it will continue on the mainland through Northern Greece, in its longest stretch, moving westwards across Albania until reaching the Adriatic coastline. The underwater section will begin by the Albanian city of Fier, crossing the Adriatic Sea to eventually connect itself with the Italian gas transportation network in the Salento, the southern tip of Italy’s Puglia region.

The TAP project will cover a 878-Kilometer distance (550 Km in Greece; 215 Km in Albania; 105 Km in the Adriatic Sea and 8 Km in Italy). It will reach the maximum altitude of 1,800 metres among the Albanian mountains, and the maximum depth of 820 metres below sea level. Economic analysts have been clear about the Pipeline: it will particularly benefit Mediterranean Countries.

The Southern Corridor will link European customers – especially Italian ones – with the producers of Azerbaijan, and potentially with other Central Asian producers, like those from Israel, Iraq as well as any other Country interested in letting the gas pass through these ducts. The Italian market will receive the most benefits from the program, obtaining gas from Azerbaijan at extremely competitive prices and taxation, with stable supplies as well. This situation will likely produce a positive influence on Italy’s economy as a whole. Some recent comments made by the Italian Prime Minister, Paolo Gentiloni, seem to strengthen this vision: “[The TAP] project is of great economic importance for Italy, with an investment of over $45 billion, representing a significant contribution to Europe’s Energy Policy.

The TAP is among those strategic programs for the Italian economy. Italy wants to win, that is, bringing Azerbaijani gas to Italy in 2020”. Thanks to this project, new investment opportunities for Italian entrepreneurs have also emerged in Albania, mainly linked to the full realization of the Albanian section of the Pipeline. In 2017, Albanian investments in the TAP will amount to around 400 million euros, as recently pointed out by TAP Albania Country Manager, Shkelqim Bozgo. According to him, the building of the Pipeline has now entered a new phase, with a planned investment amounting to the 4% of Albania GDP.

Mr. Bozgo has underlined that this will be the largest project ever realized in the Albanian economy, whose trend of development should remain stable in the coming years, reaching a total investment volume of 1.5 billion euros. Moreover, according to the Country Manager’s words, in 2020, the Pipeline will be ready to transport gas from the Shah Deniz fields in Azerbaijan to Europe. Local press reports that there are currently 1,800 people employed in Albania for the realization of the energy program, from which the government expects a 150 million-euro increase of its GDP, meaning additional investment opportunities for Italian firms.

Domenico Letizia, Ph.D. is a Political Analyst. He holds a Master’s Degree in Historical Sciences, and is the President of the Association “Amici dell’Azerbaigian Centro Sud Italia”.

Translation by: Mr. Fortunato Materazzo, Ph.D. – Political Analyst – Master’s Degree in International Relations – Relations and Institutions of Asia and Africa, Member of the Association “Amici dell’Azerbaigian Centro Sud Italia”.

Original source (in Italian): Il Tap, il Mediterraneo e le nuove reti energetiche.

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Foreign Policy News is a self-financed initiative providing a venue and forum for political analysts and experts to disseminate analysis of major political and business-related events in the world, shed light on particulars of U.S. foreign policy from the perspective of foreign media and present alternative overview on current events affecting the international relations.

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