Turkey, Azerbaijan May Reach Gas Transit Deal By September

Turkey may conclude a deal on the transit of natural gas from Azerbaijan's Shah Deniz II field by September, Turkey's ambassador in Baku said Tuesday, potentially supplying

gas to the European Union-backed Nabucco pipeline project.
Azerbaijan is negotiating shipping 10 billion cubic meters of gas through Turkey from its Shah Deniz II--the second development phase of the Caspian Sea project operated by BP PLC (BP.LN, BP)--when it comes on stream in 2017.
Under the deal, Turkey will purchase 6 billion cubic meters of gas a year, but only after the field's second phase is launched.
Turkey's ambassador Hulusi Kilic said he hopes a range to "technical issues" could be resolved by September.
A transit contract is necessary before the consortium developing Shah Deniz II can sign deals with buyers.
The EU is supporting the Nabucco pipeline project, which is slated to transport natural gas from the Caspian and Middle Eastern regions to central Europe through Turkey. Nabucco is one of a number of pipeline projects competing to get supplies from Shah Deniz II to send to Europe.
Securing Central Asian gas is crucial for the EU's priority of diversifying its energy supply, mainly away from Russia, on whose exports many countries in Eastern Europe are still heavily dependent.
The consortium of companies developing Shah Deniz--including BP, Norway's Statoil ASA (STO) and Azerbaijan state energy company Socar--has yet to announce buyers for the 10 billion cubic meters of gas expected from the field.
Source: Dow Jones