President Aliyev Announces Expansion of Azerbaijan’s Gas Exports to Europe

President Ilham Aliyev announced a significant expansion in Azerbaijan’s gas exports to Europe while addressing a joint press conference with Slovak Prime Minister Robert Fico on Tuesday. 

“Our supply to Europe will increase from 8 billion cubic meters in 2021 to up to 12 billion cubic meters this year. This accounts for 50 percent of Azerbaijan’s total gas exports,” Ilham Aliyev said on May 7, according to the official website of the Azerbaijani president. 

“Our plans include delivering 20 billion cubic meters of gas solely to the European Union by the end of 2027, and I believe we will achieve this goal,” he added.

Azerbaijan has been providing natural gas to Europe through the Trans Adriatic Pipeline (TAP) since December 31, 2020. TAP constitutes the final segment of the Southern Gas Corridor (SGC) and stretches over 773 kilometers onshore and 105 kilometers offshore, originating at the Turkish-Greek border, traversing Greece and Albania, and culminating in Italy.

The SGC consists of three segments, spanning seven countries and six regulatory systems. It connects 11 different investors and supplies natural gas to 12 distinct buyers, primarily in Europe. Initially, the pipeline’s annual transportation capacity was 16 bcm, shared between Türkiye and Europe, with 6 bcm and 10 bcm, respectively. The primary source of natural gas for the SGC is Azerbaijan’s offshore Shah Deniz field, which holds approximately 1.2 trillion cubic meters of proven reserves.

Currently, the European market accounts for the largest portion of daily gas exports from Azerbaijan, with approximately 27 million cubic meters of Azerbaijani gas supplied to European consumers each day. In 2021, Europe received 8 bcm of gas from Azerbaijan, which increased to 11.4 bcm in 2022, and 11.5 bcm in 2023. 

From 2020 to 2023, TAP supplied a total of nearly 31 bcm of gas to European buyers, of which around 1.83 bcm has been delivered to Bulgaria, 3.03 bcm to Greece, and 25.9 bcm to Italy.

In April of this year, Hungary received 50 million cubic meters of gas from Azerbaijan, half of the 100 million cubic meters agreed upon in 2023. Budapest’s authorities secured another deal with Baku to increase the supplies to 1 bcm per year.

The increase in gas supplies to Europe is being carried out under the Memorandum of Understanding on Strategic Partnership in the field of energy, signed between Azerbaijan and the EU in 2022. In the wake of the geopolitical upheaval resulting from Russia’s invasion of Ukraine two years ago, European buyers have been actively seeking new sources of natural gas.

Azerbaijan’s significant gas condensate fields, such as the “Absheron” field, projected to produce 1.5 billion cubic meters per year in its initial phase, enable the country to increase its annual supplies to overseas markets year after year. Other noteworthy fields with untapped potential include the “Babak” field with estimated reserves of 400 billion cubic meters and the “Umid” field with at least 200 billion cubic meters.

In addition to the existing markets, countries such as Slovakia, Montenegro, North Macedonia, Bosnia and Herzegovina, Croatia, and Serbia are exploring the possibility of receiving gas from Azerbaijan.

Bulgaria has already secured the import of 3 bcm of Azerbaijani gas after the inauguration of the Greece-Bulgaria Interconnector in October 2022.