A press conference of the Deputy Chairman of the Management Committee of Gazprom Yuri Komarov was held yesterday in the central office of the Company for the Turkish mass media. The press conference was devoted to the negotiation process between Gazprom and the Turkish Gas Company Botas concerning gas deliveries through the Blue Stream pipeline, which were suspended in spring of the current year.
In his introduction words Yu. Komarov reminded the journalists of the fact that Gazprom exports approximately 130 bcm of natural gas annually to the markets of Europe, the Balkans countries and Turkey. Gas deliveries were carried out under the long-term “take-or-pay” contracts. Last year Gazprom delivered 11.8 bcm of natural gas to Turkey. Since 2003 natural gas is supplied to Turkey in the frames of three existing contracts including the contract stipulating gas delivery through the Blue Stream pipeline. The terms and conditions of the last contract are identical to those of the first two contracts including the price for gas. “For over 30-year long history of the Russian gas export supplies Gazprom delivered about 2.3 trillion cubic meters to foreign markets and there was not a single case when the Company failed its partners”, stressed Yu. Komarov.
Speaking about the Blue Stream project history Yu. Komarov marked the fact the Turkish part raised the question of increasing the volume of Russian gas supply to Turkey not once and at all levels in early 90th. During the construction stage of the Blue Stream project no one but Gazprom with its partners could assume investment risks related to an increase of gas supply to the Turkish market.
The Blue Stream pipeline is of strategic importance both for Russia and Turkey as soon as it secured direct link between the major gas supplier and a foreign consumer avoiding third parties. It is especially important today when the struggle for fuel supply to the European markets trends to aggravation.
Gazprom, on its part, fulfilled its obligations on construction of the Blue Stream pipeline and the volumes of natural gas delivery through the pipeline. However, the Turkish party is raising the question of delivery volume and price reduction.
“Take-or-pay” contract condition will come into force since July 1, 2003. It means that by the end of the year Botas will have to pay for 0.8 bcm of natural gas, as provided by the contract, even in a case when the actual volume of gas withdrawn by the Turkish party is lower.
Speaking of peculiarities of the current negotiations with the Turkish partner, Yu. Komarov underlined that both parties are confident of the correctness of the strategic decision made on construction of the Blue Stream gas pipeline. The problems of gas withdrawal by the Turkish party through the Blue Stream project are of temporary character.
Yuri Komarov identified the major reasons for prolongation of the talks on the volumes and prices for gas delivered through the Blue Stream pipeline. From the point of view of the Russian party, there are two reasons for such a delay: first of all, overestimation of the rate of consumption growth by the Turkish party; secondly, failure of the Turkish party to implement the gas transmission infrastructure development plans.
The Deputy Chairman of the Management Committee underlined that the Company has prepared and submitted to the Turkish party a package of offers that assume, in particular, a partial discharge of the Turkish party from the obligations on gas withdrawal under three existing contracts for the period of five years. In addition, Gazprom suggested reinvesting a part of the proceeds from gas realization through the Blue Stream pipeline into development of the Turkish gas infrastructure.
Yuri Komarov expressed a hope that the parties will find a compromise solution of the problem and natural gas supply to Turkey will be resumed through the Blue Stream pipeline.