* Turkmenistan gas deal expected in months
* Sees Azeri gas deal following
* Is not concerned about South Stream
(Adds details, background, quote)
By Melis Senerdem
ISTANBUL March 5 RWE (RWEG.DE) expects to seal a
deal with Turkmenistan on gas supplies for the EU-backed Nabucco
pipeline project in coming months, and a deal with Azerbaijan is
seen following, an executive with the German energy firm said on
Head of Business Development in RWE Supply and Trading
Jeremy Ellis said 10 billion cubic metres of gas from
Turkmenistan is available for the pipeline, which aims to cut
Europe's dependence on Russian gas.
The 31 billion cubic metre capacity Nabucco pipeline aims to
bring Caspian and Iraqi gas to European markets, but faces
competition from Russia's planned South Stream pipeline, which
unlike Nabucco already has secure gas supplies.
"RWE is looking to secure supply. We are very hopeful to
finalize gas supply terms with Turkmenistan in the coming couple
of months," Ellis said.
"We are now expecting that Azerbaijan will have the
confidence to move at a pace to secure supplies to transit
through Nabucco ... But I suspect it is going to be Turkmenistan
then Azerbaijan," he said.
The Nabucco consortium is trying to secure as much gas as
possible from Azerbijan's Shakh-Deniz II project, which should
be producing an annual 13-16 bcm from 2016, he said.
Turkey was the final country to ratify the Nabucco transit
agreement late on Thursday, which should ease Nabucco's efforts
to secure funding and supplies for the project.
The Nabucco consortium is made up of Austria's OMV
(OMVV.VI), Hungarian MOL MOL.BU, Turkey's Botas, Germany's RWE
(RWEG.DE), Bulgaria's Bulgargaz and Romania's Transgaz
The Russian South Stream Pipeline, in addition to having
secure gas supplies, is supported by several potential transit
Ellis said he was not concerned by the rival pipeline.
"First, the timetable to bring that project to the market --
it is years behind us. The second point is a significant amount
of investment capital, 25 billion euros, is required to
construct, in a very technically challenging environment in the
Black Sea," he said.
A substantial portion of South Stream, which aims to bypass
Ukraine, will be built under the Black Sea, boosting costs for
Ellis said that between 70-80 percent of the Nabucco
pipeline's 7.9 billion euro cost would be met through financing.
(Writing by Thomas Grove)