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Qatar Turns Down Iran's EU-Bound Gas P/L Offer.

Qatar has tactfully turned down Iran's recent offer to transit Qatari natural gas to the EU market through its pipeline link with Turkey - a huge change in the geo-strategic thinking on the part of the Shi'ite theocracy's elected President Hassan Rowhani and his pragmatic mentor ex-President Ali-Akbar Hashemi Rafsanjani. But on the advice of Saudi King Salman, who has told Qatari ruler Shaikh Tamim this offer would put his emirate at Iran's mercy.

Instead, Qatar has opted to have a land pipeline built to run through Saudi Arabia, Jordan, post-Assad Syria, Turkey and then the EU. Shaikh Tamim is particularly keen on this as the project is no longer blocked by Saudi Arabia, with King Salman having reversed a decision taken by his predecessor, the late King Abdullah who died in early 2015. Competing with Russia and an Iranian project to export gas by pipeline to the EU, the proposed Qatari project could have a capacity exceeding 65 BCM/year.

Equally interesting is a proposal made by a Rafsanjani ally, Iran's Information & Communications Technology Minister Mahmoud Wa'ezi who before Rowhani's June 2013 election to the presidency used to be part of a Rafsanjani-led think tank dealing with geo-strategic options for Iran. He was formerly a deputy foreign minister. He is one of the most sensible diplomats in Iran. In an interview with the Trend publication out on Aug. 20, Va'ezi said Iran will co-operate with Azerbaijan on gas transport to Europe through the US/EU-backed Southern Gas Corridor (SGC).

Also co-chairing the Inter-Governmental Commission of Iran and Azerbaijan for Economic, Trade and Humanitarian Co-operation, Va'ezi added that Tehran, in addition to the Asian market, planned to export gas to the EU as well. Va'ezi said: "I believe we will be able to co-operate with Azerbaijan in the use of the[SGC]. We have held talks in this regard with the Energy Minister of Azerbaijan and the relevant structures". He said both countries' officials were constantly negotiating on the gas sector. Iran has a stake in Azerbaijan's largest offshore gas field Shah Deniz. Va'ezi noted: "At present, Azerbaijan is supplying gas to the Nakhchivan Autonomous Republic (NAR) through swap operations with Iran. On the other hand, at a certain time, Azerbaijan's demand of gas increases, and we can meet it. In turn, during certain periods there will be a gas shortage in Iran, which Azerbaijan can cover". Shah Deniz is being expanded on a large scale for export to both Turkey and the EU market (see omt3AzerExprtJul21-14).

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Publication:APS Diplomat Operations in Oil Diplomacy
Geographic Code:7IRAN
Date:Nov 30, 2015
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