In an interview with Today's Zaman, Mitschek articulated the approach of the private consortium he manages. “Nabucco has never, ever excluded any source. Nabucco is not excluding any source. Bottom line, we have to buy the gas. The national gas companies will evaluate the political aspect, the commercial aspect, the technical aspect and then they will decide to buy gas from Azerbaijan, Turkmenistan, Iraq, Iran and Russia. For all these sources, we are open to transport the gas,” he said.
The intergovernmental agreement on the 3,300-kilometer gas pipeline project was signed by the prime ministers of Turkey, Austria, Bulgaria, Hungary and Romania. The project will be able to carry an annual amount of 31 billion cubic meters of gas starting from 2015 and is expected to cost $11 billion. One of the two questions occupying minds about the project was who the suppliers will be, but after Monday's promising signals from possible suppliers from both the Caucasus and the Middle East, doubts began to disappear in favor of realistic expectations. The only concern in that regard remains the adverse impact of political disagreements in securing deals with Russia and in particular Iran, since Iraq, Azerbaijan, Turkmenistan, Egypt and Syria have all pledged to pump gas to Europe via Nabucco. While many believe Russia could play other cards before agreeing to get involved in the project as a supplier, Iranian participation is vetoed by the US.
Mitschek was hopeful about finding suppliers while drawing attention to the other side of the coin, the concerns on the part of suppliers. “I am sure that the Nabucco intergovernmental agreement will help secure agreements between buyers and suppliers. Up until now, suppliers have been a bit hesitant because they say they needed a stable, long-term and predictable legal framework and transparency in conditions. Now we can prove to them, and to all other stakeholders as well, that what they were demanding is now achieved,” said Nabucco's top executive, adding that he also believes Monday's agreement will boost final investment decisions in supplier countries such as Azerbaijan, Turkmenistan, Iraq and elsewhere.
Talking about the financial feasibility of the project, Mitschek said he does not see any major obstacles there, either. According to information received by Today's Zaman, 30 percent of the $11 billion currently needed for construction will come as equity cash from shareholders. The other 70 percent will be in loans from banks, mainly from the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD) and export credit agencies in Europe, the US and Japan as well as from national banks in partner countries. The EU, on the other hand, has already granted 200 million euros in funding to the project.
While the consortium and partner countries are tackling these two problems, finding suppliers on the one hand and finding financing on the other, the project, however, is far from being able to fully respond to Europe's need for diversified gas sources, since its capacity could at best meet about 5 percent of annual gas consumption on the continent. Nonetheless, it is widely believed that if this project can successfully function, it will inspire other similar projects on the same route.
In that regard, Mitschek asked national governments of partner countries and the European Commission to continue to firmly back the project politically because, he said, with the signing of the intergovernmental agreement, an important phase was successfully wrapped up, but they are “not at the end, but at the beginning of the real work.”
