TURKEY SAID TALKS ARE UNDERWAY ON SEVERAL KEY ISSUES OF NABUCCO PROJECT

/PanARMENIAN.Net/
27.06.2009 01:23 GMT+04:00

/PanARMENIAN.Net/ A European Union official said on Friday that an
imminent breakthrough looms on the draft of the text that will lay the
legal framework for the Nabucco pipeline project, however Turkey said
talks are underway on several key issues, Hurriyet DailyNews reports.

Consensus was reached Monday on the draft of the inter-government
agreement for the Nabucco pipeline planned to carry Caspian natural
gas to Europe via Turkey. "If no government party to the agreement
raises an objection by Friday night, then this will mean that there
is a complete consensus on the document which will be signed in July,"
the EU official told a group of journalists.

However, later on Friday a Turkish official denied the report of an
agreement, saying the EU had sent the document but Ankara rejected any
time pressures imposed to accept the draft. "We responded saying such
attempts will be non-efficient and will not bear any results. This
response was sent to everybody related to the issue in the European
Union," the official Reuters news agency.

There have been thorny negotiations over the document regarding
taxing issues, as well as Turkey’s request to have 15 percent of
the gas passing through the pipeline allocated to meet local energy
needs. Reuters quoted the officials as saying that an agreement was
reached on the taxation issues but talks continue on Turkey’s request.

"Reaching an agreement on the tax regime was very difficult, since
there is one entity, which is the consortium of the pipeline, but
operating in different countries," the official said.

The pipeline, which will pass through Turkey, Bulgaria, Romania,
Hungary and Austria, is made up of a consortium of Austria’s OMV,
Germany’s RWE, and the gas companies of Turkey, Hungary, Romania
and Bulgaria.

"It was very difficult to reach a consensus on the tax regime, but
they did find a formula," said the EU official who did not want to
elaborate on the details of the formula.

A formula seems to have been found on Turkey’s request for a 15 percent
lift off, but the official did not share the details. During last
month’s Prague summit, bringing the EU together with gas producing
countries, it was announced that Turkey had dropped its 15 percent
lift off request and the intergovernmental agreement would be signed
in June. "But Turkey was not happy," said the official, without going
into detail how the disagreement on the issue was solved.

It appears that Turkey and the other consumer countries in the European
Union will hold joint negotiations with the producer countries,
instead of pushing for separate deals.

"Turkey and the EU have the same problem of energy supply and energy
diversification. We are together on this. The bargaining with Caspian
suppliers will be done as a group," the official said.

Reaching a deal on the intergovernmental agreement represents an
important turning point in the realization of the project according to
the official. It not only shows the political will of the countries
party to the project, but it also enables the consortium to go ahead
with negotiations with producer countries, taking the project to
another phase.