After months of negotiations, the shareholders of the Nabucco International Company on 10 January signed a non-binding memorandum of understanding (MOU) that would put the Nabucco West pipeline on an equal footing with the Trans Adriatic Pipeline (TAP), the alternative project for the transportation to Europe of 10 bcm/year of gas produced from phase 2 of the Shah Deniz (SD) field. The agreement calls on the four SD partners – SOCAR, Total, Statoil and BP – to join the five Nabucco participants (Bulgaria’s BEH, Romania’s Transgaz, Hungary’s FGSZ, Austria’s OMV and Turkey’s Botas) in financing the project’s development costs until 30 June 2013, that is until the SD consortium reaches a final decision between Nabucco and TAP. In addition to the co-financing of development costs for a period that cannot be extended by more than five and a half months the Nabucco partners will offer the four SD companies equity options of up to 50% of the consortium’s shares, if Nabucco is selected as Azerbaijan’s main export pipeline to Europe.

Although the agreement will have little practical impact, it is welcome news for the remaining Nabucco partners, who only last month “lost” their most powerful shareholder, Germany’s RWE (MEES, 14 December 2012). BP, Total and SOCAR have been leaning towards the TAP option, which is led by their Shah Deniz partner Statoil. (CONTINUED - 268 WORDS)