No problem: for gas for Nabucco says project head Reinhard Mitschek
Mitschek confident on flow for Nabucco
Gas from Iraq and Central Asia can "comfortably" fill the entire Nabucco pipeline, the head of the consortium Reinhard Mitschek said today, suggesting concerns over securing enough supplies were unfounded.
Energy analysts have questioned the plan to transport up to 31 billion cubic metres of gas per year from the Caspian region to an Austrian gas hub via Bulgaria, Romania, Turkey and Hungary because of a lack of solid supply agreements.
But the project's managing director Mitschek told Reuters he was optimistic about Iraq's prospects as a supplier.
The first gas - most likely from Iraq - is expected to flow through the pipeline in the last quarter of 2014.
"Nabucco and the shippers are in a comfortable situation because we can comfortably fill Nabucco, even with 31 Bcm (with supplies) from Iraq and from Central Asia, like Azerbaijan," Mitschek said in an interview at the consortium's headquarters.
"Nabucco is one of the important outlets for the Iraqi gas. The gas potential is enormous. It is in a mature phase compared to other countries, it is not in the first phase of exploration but it is already in the production phase."
The consortium said this year it expects some 8 Bcm of gas from Iraq's Kurdistan in 2015, followed by a further 8 Bcm from Azerbaijan. The rest of the gas in the later stages of the project is likely to also some from these sources.
"Iraq is keen to export gas and to modernise. Recently we saw ExxonMobil entering Iraq so now the race for oil and gas has started (there)," Mitschek said.
Nabucco's shareholders - which include Austria's OMV, Hungary's MOL, Romania's Transgaz, Bulgaria's Bulgargaz, Turkey's Botas and Germany's RWE - may also have to decide whether to seek supplies from Iran.
Iran sits on the world's second-largest gas reserves after Russia but has been slow to develop exports, partly because of sanctions hindering the access to needed technology.
Nabucco does not need Iranian gas but could potentially consider the country as a future source if there was a stable political system in place to assure potential customers, Mitschek said.
"There will not necessarily have to be Iranian gas in Nabucco," he said.
"But in the long-term I will not exclude any source."
The EU-backed pipeline, aimed at easing Europe's dependence on Russian gas, faces rivalry from the similar South Stream project launched by Russian gas group Gazprom .
Adding urgency to the the 7.9 billion euro ($11.8 billion) Nabucco project is the gas row between Russia and Ukraine that has raised fears of a repeat of last winter's crisis when supplies were cut off to parts of Europe.
The Nabucco consortium has said the row underlines the need to diversify energy sources but Mitschek added today that a crisis this winter could destroy the image of natural gas as a supply source and be negative for Nabucco.
Growing acceptance of nuclear power as more countries in Europe explore the atomic option should also not affect Nabucco's prospects in part because of the long time it takes to build nuclear plants and win permission for them, Mitschek said.
"I believe that for power generation, natural gas will be a very important element," he said.