2024-03-04 15:00:53
Source: Trend International Information Agency
The Trans Adriatic Pipeline (TAP) consortium aims to make a significant contribution to the goals of the European Green Deal and the Paris Agreement, potentially supplying the EU with low-carbon and renewable gases in the future.
As Day.Az reports, TAP Managing Director Luca Schiepatti said this in an exclusive interview with Trend on the eve of the meeting of the Advisory Council of the Southern Gas Corridor (SGC), which will be held on March 1 in Baku.
“TAP is focused on improving Europe’s energy security and diversifying energy routes, as well as ensuring a fair and sustainable energy transition, especially in South-East Europe and the Western Balkans, which are overly dependent on fossil fuels. Achieving these goals is a complex task that requires ongoing dialogue and collaboration between trusted and reliable partners offering different solutions during the ongoing market test procedure 2023. Therefore, together with other representatives of the TAP consortium management, I will travel to Baku to participate in this important meeting. This meeting provides an excellent opportunity to discuss the progress of subsequent work on the Southern Gas Corridor and future plans to expand our strategic energy value chain, of which TAP represents the European leg, transporting energy resources to relevant markets,” said the Managing Director.
Luca Schiepatti added that in 2023, a ministerial meeting of the Green Energy Advisory Council was held for the first time, which made it possible to exchange views on the green agenda of the SGC.
“At TAP, we aim to make an important contribution to achieving the goals of the European Green Deal and the Paris Agreement, potentially supplying the EU with low-carbon and renewable gases in the future and implementing new energy strategies. Among other things, we aim to achieve carbon neutrality through expansion projects through the electrification of our compressor stations and other climate change mitigation measures. Therefore, for the second year in a row, the Green Energy Advisory Council will provide an excellent platform to discuss these issues,” he said.
Schiepatti noted that the entire industry is now focused on hydrogen as one of the key solutions to support the energy transition and ultimately achieve carbon neutrality by 2050.
“TAP has embraced this idea from the outset. Our goal is to develop an asset that will enable the transport of hydrogen, initially in the form of a mixture with natural gas. We are in the process of assessing the extent to which TAP can technically support the transport of a mixture of natural gas and hydrogen. In 2021 This year’s Initial Hydrogen Transport Readiness Study has confirmed that TAP has the potential to transport a hydrogen mixture. We have already begun material testing and expect initial results for the offshore portion of the pipeline to be available by the second quarter of 2024. Depending on the results of these initial tests, TAP may continue to hold tenders for broader research,” he said.
The managing director noted that the timing of the actual transport of the hydrogen mixture will depend on confirmation of the suitability of the pipeline material, the completion of wider studies and, most importantly, the availability of hydrogen and whether there is market interest.
“In the long term, we assume that hydrogen concentration will gradually increase in line with the development of the hydrogen market and corresponding demand, as well as with the development of the regulatory framework at both EU and Member State level,” Schiepatti said.
Market tests
He noted that the strategic importance of the SGC and TAP is recognized in the REPowerEU plan, which calls for increased cooperation with Azerbaijan and building the capacity of the TAP to increase gas supplies to the EU and the Western Balkans.
“In July 2022, the EU signed a Memorandum of Strategic Energy Partnership with Azerbaijan with the aim of doubling the capacity of the SGC to supply the EU with at least 20 billion cubic meters of gas per year by 2027. The pipeline’s nominal capacity is 10 billion cubic meters per year with the potential doubling to more than 20 billion cubic meters per year. TAP expansion opportunities are offered to the market through regular market tests in an open, transparent and non-discriminatory manner. Market tests are conducted at least once every odd-numbered year. Market tests are divided into two stages: non-binding and binding,” – Schiepatti added.
The Managing Director recalled that the 2021 market test was completed earlier this year, resulting in commitments that TAP will add a further 1.2 billion cubic meters per year to pipeline capacity by 1 January 2026.
“This first expansion step reinforces the importance of the SGC for the security of EU energy supply and opens the way for further expansion, which can be achieved in stages through participation in the following market tests. The non-binding stage of the new market test 2023 was started in July 2023 and is still ongoing. We We expect its binding phase to take place towards the end of 2024. TAP will offer the market an updated full range of capacity levels covering the full range up to 20 bcm/year. Cumulative results from the non-binding phase of the 2023 market test will be published in a demand assessment report in due course in consultation with neighboring transmission system operators, which means confirming the feasibility of conducting a market test based on market interest to book new additional long-term capacity,” he said.
Expansion process
The Managing Director noted that TAP is continuing the related work required to provide the market with an additional 1.2 billion cubic meters per year.
“TAP will add one compressor unit (approx. 15 MW) to the existing compressor station in Kipoi (Alexandroupolis area), on the Greek-Turkish border, and upgrade the equipment there. After completing the first civil works, we started the first temporary construction works and excavations foundation for the new compressor station building at Kipoi. We will also begin excavation work associated with the new electrical department building. Work to prepare for the main pipeline tie-ins is nearing completion. In addition, the procurement of major materials and engineering works continues according to the general schedule project. We expect commercial operation to begin on December 31, 2025,” he added.
Schiepatti recalled that TAP’s initial capacity of 10 billion cubic meters per year was allocated to shippers and reserved for 25 years in accordance with long-term gas transportation contracts signed back in 2013.
“TAP offers short-term booking capacity to the market through the PRISMA platform. The level of these short-term bookings depends on the needs of the market. However, since February 2022, due to the ongoing crisis, we were invited to address the problem of natural gas shortages in Europe, and we have successfully completed this task. Since then, we have been close to full capacity, with significant short-term orders in addition to long-term commitments, and our shipper numbers have increased significantly,” he said.
The Managing Director noted that since the start of work on the last day of 2020, more than 32 billion cubic meters of gas have been transported through TAP to date.
“In 2023 alone, we transported 11.5 billion cubic meters of gas, the highest annual volume since we began operations. TAP has proven itself to be a resilient and reliable strategic energy infrastructure over the last three years of its existence, and we are committed to continuing to support Europe in 2024 and beyond,” he said.