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Azerbaijan postpones Shah Deniz route decision-SOCAR

A decision on an export route for Azeri gas which could reshape future energy flows to Europe has been delayed until March 2012, the president of Azeri state energy company SOCAR said on Monday.

The Nabucco, Interconnector Turkey-Greece-Italy (ITGI) and Trans Adriatic Pipeline (TAP) consortia are vying to build the infrastructure to carry gas to Europe from the second phase of Azerbaijan's Shah Deniz gas field.

One more option is a pipeline from Turkey to the Romania-Hungary border, a route proposed by British oil group BP days before a deadline for consortia to submit bids.

"A detailed review of submitted proposals is under way right now. It's likely that this process will continue until the first quarter of 2012," Rovnag Abdullayev told reporters.

SOCAR had previously hoped that the decision would be announced before the end of 2011.

Shah Deniz, being developed by BP, Statoil and Azeri SOCAR, is estimated to contain 1.2 trillion cubic metres of gas, which European companies hope can supply them for decades, cutting their dependence on Russia.

Production was launched in 2006, with the second phase expected to start by 2017.

Abdullayev dismissed speculation that the EU-backed 31 billion cubic metre (bcm) Nabucco pipeline was not an option any more.

"Nabucco as well as TAP and ITGI is under consideration," he said.

Europe's efforts to cut its dependence on Russian gas have been dealt a blow by renewed financial turmoil in Europe, where two of the proposed pipelines, ITGI and TAP, cross Greek territory.

At a cost of more than 10 billion euros, Nabucco is "not cheap", EU Energy Commissioner Guenther Oettinger said on Nov. 4. (Reporting by Lada Yevgrashina; writing by Margarita Antidze in Tbilisi; editing by Jason Neely)

Source: Reuters

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