UPDATE 2-AZERI LEADER LAMBASTS TURKEY AS GAS ROUTE TO EUROPE
By Afet Mehtiyeva

Reuters India
Fri Oct 16, 2009 11:51pm IST

BAKU, Oct 16 (Reuters) – Azerbaijan said on Friday Turkish terms
for gas transit to Europe were unacceptable and the country was
considering other routes to Europe, heightening tensions over a thaw
between Ankara and Azeri foe Armenia.

"We’ve run out of options and the current offers cannot be accepted,"
President Ilham Aliyev told a government meeting.

"We have been supplying gas to Turkey for a long time at a price which
is one third of the world price," he said in televised comments. "What
country, especially in such a difficult time, would agree to sell
its resources at 30 percent of world prices?"

Russia is competing with Europe’s proposed Nabucco pipeline for
access to gas supplies from the second phase of Azerbaijan’s
multibillion-dollar Shah Deniz deposit in the Caspian Sea.

But Azerbaijan, a supplier of oil and gas to the West, is angry
at a thaw in relations between Muslim ally Turkey and neighbouring
Armenia, Azerbaijan’s enemy in a festering conflict over the breakaway
Nagorno-Karabakh region.

Turkey and Armenia signed accords last week on the establishment of
diplomatic relations and reopening of their border, the latest step
in overcoming a century of hostility stemming from the World War One
mass killing of Armenians by Ottoman Turks.

The accords need to be ratified by parliaments in both countries,
and face opposition from hard-line nationalists, and particularly
the powerful Armenian diaspora.

In Armenia on Friday, some 2,000 supporters of the nationalist
Armenian Revolutionary Federation, known as Dashnaktsutyun, rallied
in the capital Yerevan, calling for a halt to the thaw without Turkish
recognition of last century’s killings as genocide.

GAZPROM

Turkey rejects the ter ct.

Trying to satisfy Azerbaijan, Ankara says it first wants Armenia
to make concessions over Nagorno-Karabakh before it will ratify the
accords and open the border.

The mainly Armenian-populated mountain region broke away from
Azerbaijan in the early 1990s with the backing of Armenia and has
resisted 15 years of mediation to resolve its status.

Azerbaijan and Turkey are in the midst of protracted negotiations
over the terms of future gas supplies from Azerbaijan. Aliyev said
Azerbaijan would start gas supplies to Russia from next year and
possibly Iran in the future.

Russian energy giant Gazprom (GAZP.MM: Quote, Profile, Research) has
secured a deal to import a modest 500 million cubic metres of Azeri
gas from next year but has said it intends to increase volumesThis
could give Moscow the upper hand in its rivalry with the European
Union for influence over the flows of gas from the former Soviet
republic to European markets.

The EU-sponsored and U.S.-supported Nabucco pipeline is a rival
to Gazprom’s South Stream planned link, which envisages carrying
Russian gas to Europe via the Black Sea to bypass transit countries,
including Ukraine.

Industry and Energy Minister Natik Aliyev told the government meeting
that Shah Deniz would produce nine billion cubic metres of has per
year from 2013.

"The current production at Shah Daniez is 23 million cubic metres
per day, and from 2013 Shah Deniz will produce nine billion cubic
metres of gas per year and 40 million of gas condensate per year,"
he said. (Additional reporting by Amie Ferris-Rotman in Moscow and
Hasmik Lazarian in Yerevan; Writing by Margarita Antidze and Matt
Robinson in Tbilisi)

From: Emil Lazarian | Ararat NewsPress