- TAP reaches financial close, securing €3.9 billion financing
- EBRD providing up to €1 billion syndicated loan
- Pipeline to diversify Europe’s energy supply with gas from the Caspian region
The Trans Adriatic Pipeline (TAP) is announcing financial close today, with €3.9 billion secured from public and private lenders.
The EBRD is part of this consortium with a €1 billion loan syndicated to a group of 16 commercial banks with €500 million being provided on the Bank’s own account.
TAP is a priority project of the European Union (EU) and the Energy Community, an international organisation which brings together the EU and its neighbours to create an integrated pan-European energy market.
The 878-kilometre pipeline will start at the Greek/Turkish border, cross Albania and, after passing under the Adriatic Sea, terminate in southern Italy. It constitutes the final segment of the Southern Gas Corridor, a supply route to transport gas from the Caspian Sea to Europe.
With an initial annual capacity of 10 billion cubic meters – equivalent to the energy consumption of approximately seven million households in Europe – the pipeline will make a significant contribution to the diversification of Europe’s energy supply. The first delivery of gas is expected in 2020.
It will also make energy supply for consumers more reliable and achieve significant CO2 reductions by offering an alternative to more polluting energy sources, supporting the transition to low-carbon economies in line with the EBRD’s new energy sector strategy.
Nandita Parshad, EBRD Managing Director Sustainable Infrastructure, said: “The Trans Adriatic Pipeline will set the foundation for an integrated gas market across south eastern Europe and enhance the region’s strategic status as an energy hub. We believe that gas remains an important transition fuel in this region that can help displace coal and facilitate penetration of renewables.”
Financing is provided by a group of 17 commercial banks, alongside the EBRD, the European Investment Bank and the export agencies France, Germany and Italy.
At its start point in Turkey, TAP will connect to the Trans Anatolian Pipeline (TANAP) for which the EBRD approved a US$ 500 million loan in 2017. At the end point in Italy, TAP will connect to the Italian natural gas network and from there to wider European networks.
With exit points along the route, TAP has the potential to support new gas infrastructures, integrating markets across Southeastern Europe and enhancing the region’s strategic status as energy gateway. For example, TAP’s interconnectivity will be the foundation of the Albanian gas market and connect the country to one of the most innovative and important infrastructure corridors in Europe.
The EBRD is providing support for the development of institutions and regulations of the Albanian gas market through technical cooperation to support legal and regulatory capacity of the new natural gas TSO for Albania, Albgaz.
TAP has been designed in accordance with international best practice, including route selection, completion of environmental and social impact assessments, the implementation of robust contractor management controls and ongoing engagement and dialogue with the local population. This includes national environmental requirements, relevant EU legislation and EBRD performance requirements under its environmental and social policy. The EBRD will continue to monitor the project during construction and operations to ensure the continued compliance with these commitments.
The Southern Gas Corridor has a total estimated cost of US$ 40 billion and includes gas infrastructure investments into a 3,500-kilometre network of pipelines crossing six countries. Key components are the Shah Deniz offshore gas field in Azerbaijan, the Southern Caucasus Pipeline in Azerbaijan and Georgia, TANAP in Turkey and TAP. The inauguration of TANAP took place in June in Turkey.