Azerbaijan’s efforts to support Europe's energy security (OPINION)

by Shahmar Hajiyev

The ongoing war between Ukraine and Russia changed the traditional energy map of Europe. It is worth noting that European dependence on Russian natural gas differs significantly by country, therefore, since the outbreak of the Russia–Ukraine war, the volatility in the European energy markets has impacted EU member states differently, depending on their energy mix. The diversification of gas supplies and routes will contribute positively to the security of energy supplies. To this end, Azerbaijan’s efforts to bolster support for Europe, appreciated by European officials. 

The export of Azerbaijani natural gas to Europe via the inter-regional Southern Gas Corridor (SGC) project has become highly important for Europe’s energy security. Azerbaijan is a strategic energy partner for the EU. Azerbaijan is gradually increasing its gas exports as in 2021, the country exported around 19 bcm of gas, in 2022 this number was equal to 22.6 bcm, and in 2023 gas export is expected to be around  24.5 bcm.

In recent years, the EU and Azerbaijan have started intensive negotiations on increasing natural gas exports as well as developing green energy cooperation. EU and Azerbaijan signed the “Memorandum of Understanding on a Strategic Partnership in the Field of Energy” on July 18, 2022. In this, the parties agreed to increase the share of Azerbaijani natural gas transmitted to Europe via the Trans Adriatic Pipeline (TAP) as soon as possible and reach at least 20 bcm per year by 2027.  

Also, it should be noted that after signing of this important document, many EU MSs aim to buy the Azerbaijani gas and diversify energy sources and supply routes. For instance, Hungary, Romania, Serbia, Albania and others are interested in buying Azerbaijani gas as soon as possible. Towards this end, Hungary is interested in deepening energy cooperation with Azerbaijan to buy around 1-2 bcm of gas. In view of developments in Hungary, during a recent official visit, Mikayil Jabbarov, Minister of Economy of Azerbaijan, and Minister Péter Szijjártó signed a “Memorandum of Understanding on Natural Gas Cooperation between the Ministry of Economy of the Republic of Azerbaijan and Ministry of Foreign Affairs and Trade of Hungary.”

Moreover, Azerbaijan and Romania signed an agreement on gas supply the last year. According to agreement between SOCAR and Romgaz S.A., the supply of Azerbaijani natural gas starts from January, 2023. This agreement was shirt-term spot contact which envisages to supply around 300 million cubic meters of gas from SOCAR from January 1 to April 1, 2023. Azerbaijan and Romania signed another gas purchase contact of February 2023 to buy additional volumes of Azeri gas during 2023-2024 years. According to agreement up to 1 bcm of gas will be delivered from Azerbaijan to Romania in 2023-2024. By this, Romania has joined the of the Southern Gas Corridor and diversifies its supply sources.

The European leg of the SGC - the TAP pipeline is the strategic energy project which support Europe’s diversification efforts. It also supports Europe’s initiative to develop gas Interconnectors across Europe.  To this end, the opening of Gas Interconnector Greece-Bulgaria (IGB) on October, 2022 in Sofia is another important development which will further support diversification of supplies in Europe. It will enable the diversification of imported gas supplies through Greece, including complementary supply sources from the Caspian, the Middle East, the eastern Mediterranean, and LNG supply via new and existing terminals in Greece and/or Turkiye. At the same time, the existence of this interconnector strengthens the position of Azerbaijan. With the launch of the IGB project, Bulgaria can also become an energy hub, because states such as Serbia, Romania, and North Macedonia are very interested in the purchase of Azerbaijani natural gas. In fact, the IGB project is supported by the Trans-European Networks for Energy, and it is a project of common interest and a priority project under the Central and South Eastern Europe Energy Connectivity High-Level Group.

Meanwhile, renewable energy sources are also important for EU. To this end, the signed “MoU on a Strategic Partnership in the Field of Energy” between Azerbaijan and EU also opened up new opportunities for the development of green energy and electricity transmission between Europe and Azerbaijan. The tremendous green energy potential of Azerbaijan is the basis for creating a renewable energy platform between Europe and the region.

The “MoU on a Strategic Partnership in the Field of Energy” opened new opportunities for cooperation, and on December 17, 2022, at the Bucharest plenary meeting, where Azerbaijan, Georgia, Romania, and Hungary signed an “Agreement on Strategic Partnership on Green Energy” supports effective long-term green energy cooperation. This agreement envisages the export of electricity from Azerbaijan via an underwater electric cable under the Black Sea from Georgia to southeastern Europe. Azerbaijan will be not only an exporter of fossil fuels, but also of green energy to the EU via Romania and Hungary. This green energy deal is highly important for Romania and Hungary as the electricity mix of these countries, especially Hungary, mainly relies on fossil fuel.

It is clear that all signed documents between EU member states and Azerbaijan show strategic partnership, and great opportunity to further develop bilateral relations. This year’s the Southern Gas Corridor Advisory Council 9th Ministerial Meeting and the Green Energy Advisory Council 1st Ministerial Meeting held on 3 February, 2023 in Baku reaffirmed the strategic energy partnership between Azerbaijan and the EU. It is worth noting that the Green Energy Advisory Council Ministerial meeting was held for the first time under umbrella of Southern Gas Corridor Advisory Council. The first meeting of the Steering Committee on the implementation of the “Agreement on a strategic partnership in the field of green energy between the Governments of Azerbaijan, Georgia, Hungary and Romania” as part of the Advisory Council further strengthened green deal initiatives between these countries. The plenary session the “Green Energy: Delivery of Caspian Sea Wind Energy to European Energy Markets” was very important to discuss future plans in this direction. It opened up new opportunities for all involved partners to develop further green energy deals. In brief, Azerbaijan initiated green platform between the South Caucasus and Europe.

In the end, today, Europe’s energy system urgently needs diversification of sources and routes, and it is also noteworthy that both natural gas and electricity exports from Azerbaijan to Europe will contribute to continent’s sustainable development and energy security. Both electricity and natural gas will be important source of energy from Azerbaijan to Europe. Last but not least, for Azerbaijan, exporting both natural gas and green energy to Europe, is beneficial as the country aims to deepen strategic partnership with the EU.

Shahmar Hajiyev, a senior advisor at the Baku-based Center of Analysis of International Relations (AIR Center), exclusively for News.Az

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