Azerbaijan gains importance as new commercial transportation corridor

Azerbaijan gains importance as a new commercial transportation corridor, the U.S. ambassador to Azerbaijan Robert Cekuta said at the Fifth Frankfurt Gas Forum on December 14.

The ambassador noted Azerbaijan is developing into an increasingly important transit hub, which makes it key to a global venture – the New Silk Road.

Cekuta reminded that in late October, the Azerbaijani and Turkish Presidents, along with top figures from Georgia and a number of Central Asian countries officially inaugurated the Baku-Tbilisi-Kars railroad.

“This new modern rail link, along with the new port of Alat south of Baku on the Caspian, will provide a surface route connecting East and South Asia with Western Europe. Rather than taking 35 days to move goods by ship between Shanghai and Hamburg, these new rail and ferry links could enable goods to travel this same distance in 11 to 14 days,” the envoy said.

He added that these new surface connections augment the air corridor already used through Azerbaijan’s airspace, in addition to the new, modern air cargo facilities.

The Baku-Tbilisi-Kars railway was constructed on the basis of the Azerbaijan-Georgia-Turkey intergovernmental agreement. The main purpose of the project is to improve economic relations between the three countries and gain foreign direct investment by connecting Europe and Asia.

The project implementation began in 2007 and construction began in 2008. The line is intended to transport one million passengers and 6.5 million tons of freight at the first stage. This capacity will then reach 3 million passengers and 17 million tons of cargo.

During his speech, Cekuta also said that the discovery and development of the Shah Deniz 2 gas deposit makes Azerbaijan an important contributor to European – and thus global – energy security.

“The technology being developed in Azerbaijan to extract gas from the Shah Deniz 2 field will be used elsewhere, including to get at hydrocarbons in the Gulf of Mexico,” the ambassador noted.

Reminding that the Shah Deniz 2 gas will be a source for the Southern Gas Corridor Project, the envoy said that the project with a budget in excess of $40 billion, and a 3,500 kilometer pipeline crossing six countries, going from below sea level to elevations of more than 2,500 meters, provides a new source of natural gas to millions in Europe, boosting energy security globally.

“Looking at the four chief components, the development of the giant Shah Deniz 2 gas field itself is 97 percent complete. The expansion of the massive Sangachal terminal south of Baku is 99.8 percent complete, and construction of the pipeline across Azerbaijan and Georgia is 98 percent complete. Construction of the Trans Anatolian Pipeline or TANAP is 93 percent finished and work on the Southern Gas Corridor project’s fourth component, the Trans Adriatic Pipeline TAP, which will initially bring 10 bcma [billion cubic meters per annum] of gas to Italy, is 57 percent complete,” Cekuta said.

Shah Deniz 2 is a giant project that will add a further 16 billion cubic meters per year (bcma) of gas production to the approximately 9 bcma produced by Shah Deniz 1. Being one of the largest gas developments in the world, the project will help increase European energy security by bringing Caspian gas resources to markets in Europe.