Azerbaijan wants to expand gas infrastructure in Albania

Azerbaijan is set to invest significantly in gas infrastructure in Albania amid ongoing expansion into the region’s gas distribution network, Azerbaijan’s President Ilham Aliyev said at a geopolitics conference Thursday, but not everyone is convinced this is a good idea.

Aliyev made the comments at the fourth Shaping the Geopolitics of Greater Eurasia conference organised by ADA University in the Azerbaijani city of Shusha.

Albania does not currently use any gas, instead relying on hydropower, some solar, and imports of fossil energy. It is, however, home to the Trans Adriatic Pipeline, part of the Southern Gas Corridor (SGC) which passes through large swathes of its territory as it transports gas from Azerbaijan to Europe.

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“Albania is transitory, but there is no gas distribution network. We are planning to invest a significant amount of money to establish this distribution network,” he said.

Aliyev added that he visited Sofia recently to attend the signing of a memorandum of understanding (MoU) on gas transmission, called the Solidarity Ring.

Signed on 25 April, the MoU lays down plans for a gas transmission corridor- a joint initiative between Bulgartransgaz (Bulgaria), Transgaz (Romania), FGSZ (Hungary), SOCAR (Azerbaijan) and Eustream (Slovakia) – which aims to offer additional natural gas transmission capacities of up to 9.5 billion cubic metres (BCM) of gas a year.

The gas would flow from Azerbaijan to Eastern, Central, and Western Europe through Bulgaria, Romania, Hungary and Slovakia.

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Aliyev added that after Slovakia joined the project, more are expected to come on board.

“Slovakia is joining the project. So, if now we export to six countries, within a year if everything goes according to plans, without any great effort, it can be 10. And this is not the end” he said.

Aliyev also said Albania could join the buyers of the Azerbaijani gas due to SGC’s crossing the Balkan country’s territory. According to the Azerbaijani president, the negotiations are currently well underway.

Albania has made no secret of its desire to become a gas hub of the Balkans but possible expansion into the use of gas poses a number of issues.

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Gligor Radecic, gas campaigner at Bankwatch believes the news is not good for Albania.

“Albania is struggling with the over-reliance on climate-vulnerable hydropower. Still, new import dependence on fossil fuels from a corrupt and autocratic regime is the last thing this country needs,” he said.

He added that the current energy crisis is primarily caused by fossil gas and therefore, developing a new gas distribution network from scratch in a country that does not currently consume gas “seems like madness” and would introduce emissions in the currently emissions-free domestic energy sector.

“Albania must avoid repeating the mistakes of its EU neighbours, who are now struggling to wean off the gas. Therefore, Albania’s lack of gas infrastructure should not be seen as a ‘lack’ but as a plus,” he told EURACTIV.

As developing such infrastructure would take years, Radecic said the time would be better spent supporting investments such as tackling electricity distribution losses, increasing the use of heat pumps and deep renovation of residential buildings.

“Given the level of energy poverty in the country, the Albanian government will need to heavily subsidise domestic gas consumption for consumers to use it, which could deplete already limited state coffers, or consumers won’t be able to absorb high costs and volatile gas prices, which could leave the infrastructure stranded,” he said.

As an EU hopeful, there are also concerns over Azerbaijan’s human rights record not being in line with the bloc’s human rights standards. Expanding the gas infrastructure will send more money to the country which is known for corruption and repression of all opposition.

The country and SOCAR have also been linked to several scandals in other parts of Europe, some including EU funds as well as the Azeri Laundromat which saw billions of euros finding its way into the pockets of European organisations and even politicians in return for favourable treatment and lobbying.

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(Alice Taylor | Exit.al)