Potential Iranian gas exports to EU not to be discussed in near future

Potential Iranian gas exports to the EU might be discussed, but not in the “near future”, distinguished research fellow and emeritus professor of chemical engineering at Imperial College London, UK, author of the book “Powering Europe: Russia, Ukraine and the Energy Squeeze” Rafael Kandiyoti told Trend.

“That is for the future – six to ten years at least,” he said. “There will be a whole lot of issues to resolve about gas transmission. Type of exports (i.e. pipeline through Turkey versus LNG) will be one of these issues.”

Kandiyoti made the remarks within the framework of the visit of the EU high-ranking officials to Iran Apr. 16.

The EU High Representative for Foreign Affairs and Security Policy Federica Mogherini arrived in Tehran, Iran, heading a high-ranking economic and political delegation Apr. 16.

Officials from Iran and the EU are expected to discuss cooperation in various fields, including climate, environment, economic and energy fields.

Industry and nuclear technology, agriculture, shipping and fishery, as well as drafting a roadmap on cooperation between Iran and the EU are among other issues to be discussed during the meeting.

Gas prices are low at present, Kandiyoti said, adding that both LNG installations and the (longish) pipeline through Turkey would represent large chunks of investment.

“At present gas prices, it is hard to see how either type of project could be made financially viable,” he said.

He went on to add that Iran would also need to evaluate the implications of gas exports to Europe, within the scope of the country’s relationship with Russia.

Speaking about possible routes for transportation of Iranian gas to Europe, Kandiyoti said there already are gas pipeline connections with Turkey.

In purely engineering terms, this would be the most practical (and probably cheaper) route, he said.

However, there will be a number of political problems to sort out, not least between Iran and Russia, he said, adding that much would depend on the volume of gas exported.

At present, the Tabriz-Dogubayazit-Erzurum gas pipeline is working at half its design capacity of 20 billion cubic meters per year, so part of the infrastructure for relatively small export volumes is already in place, according to him.

Speaking about the prospects of cooperation between Iran and the EU, Kandiyoti said there is a huge range of issues to discuss.

“I think the Iranians need more urgent cooperation with the European banking sector,” he said. “In the short to medium term, Iran will want to establish routine payment mechanisms for oil exports.”

Source: Trend