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Georgian PM assesses economic and political significance of Southern Gas Corridor

Georgian PM assesses economic and political significance
Georgian PM assesses economic and political significance of Southern Gas Corridor

Georgian Prime Minister Giorgi Gakharia said that Azerbaijan's giant Shah Deniz field gas has started flowing to the EU, with this being a tremendous step forward.

The Southern Gas Corridor (SGC) aims to develop gas supply routes passing through the Southern Caucasus and Turkey to supply gas from the region to Europe.

The Prime Minister said that the SGC compensates for the reduction of local gas generation in Europe. It also aims to enhance competition in the European single market. Additionally, it will supply commercially attractive and more environmentally friendly gas to the Balkan countries, which have not so far used it or have been dependent on Russian gas imports.

The SGC ensures the supply of Shah Deniz field gas to Turkey and the EU countries through Georgia, Turkey, Greece, and Albania. It will serve seven EU states and ten major energy consumers in Turkey.

Following the corresponding agreements, Georgia will get the SGC gas at a considerably reduced rate. The options contract enables the country to get around 5% of gas passing through it annually. The deal is valid before 2066. The additional gas purchase and sale agreement is in force until 2026. In accordance with the agreement, Georgia will receive around 500 mln cubic meters of gas annually.

PM Gakharia also stressed that if Georgia has so far been a transit country of regional significance, it has now become an international actor: the gas passing through its territory will play a crucial role in diversifying the European Union's energy markets.

The SGC comprises the key components as follows: the South Caucasus Pipeline Expansion Project (SCPX), the Trans-Anatolian Natural Gas Pipeline (TANAP), and the Trans Adriatic Pipeline (TAP).

On the invitation of the President of Turkey, Georgian Prime Minister Giorgi Gakharia, together with Recep Tayyip Erdogan and Azerbaijani President Ilham Aliyev, participated in the inauguration ceremony of the Trans-Anatolian Natural Gas Pipeline project last year.

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