Currently, about one-fourth of the European Union’s gas supply comes from the single company, Russian Gazprom, and about 80% of that supply comes by a single route, via Ukraine, which is a critical transport point for both Russia and EU. This has resulted in Europe facing a dual monopoly on gas supply. The European response to this predicament southern gas pipeline should be built if the energy security for countries of southern Europe is to be achieved. Since the South Stream pipeline cannot be built until it is in compliance with regulations a new project is put forward, the South Corridor.
The South Corridor starts at the Shah Deniz fields in Azerbaijan and was planned to consist of two gas pipelines. Independently of Russian supply, gas would flow from Central Asian and Caspian basins and will go through Turkey, Greece, and Albania toward Italy. The route to Hungary via Serbia and the former Yugoslav Republic of Macedonia is under consideration as well.
The two gas pipelines mentioned are: now almost abandoned Nabucco, for which revival Iran us showing a great interest, and the (TANAP) Trans-Anatolian gas pipeline. Construction of the Azerbaijan section of TANAP already begun in September of 2015 and although initial completion deadline is planned for 2018. it is now moving to 2020. It is supposed to go from Azerbaijan via Turkey to the Greece where it will join with Trans-Adriatic pipeline (TAP) and continue to Italy via Albania with the interconnection with the pipeline going to the South-Eastern Europe countries that participated in, for now, failed South Stream pipeline. Currently, the estimated cost of both Trans-Adriatic and Trans-Anatolian pipelines is around fifty billion US dollars.
With Azerbaijan controlling the majority share in TANAP, they will be in a good position to dictate rates and volume of gas, to even greater extent than Russian Gazprom ever could in Ukraine. But, one thing that is perfectly clear, efforts must be made if Europe doesn’t want to depend on only one gas supplier, but also in order to develop its internal energy market.