Both sides in December signed a memorandum of understanding for the 1,240-mile Trans-Anatolian Pipeline. It will eventually carry natural gas from the BP-controlled Shah Deniz field in the Azeri waters of the Caspian Sea.
Elshad Nasirov, vice president of the State Oil Co. of Azerbaijan Republic, told Bloomberg News the deal was delayed over tax issues but "we aim to complete talks this month and sign the inter-governmental agreement by June 30."
The project, dubbed TANAP, could eventually link to Nabucco West, a scaled-down version of the larger $10.4 billion proposal, or BP's planned South East Europe Pipeline from the Turkish border.
Nasirov described Nabucco as a "fantastic" proposal despite financial woes. SEEP, he said, was less advanced than the Western-backed Nabucco pipeline.
Project partners expect to have TANAP built before Shah Deniz starts production by 2017. Shah Deniz partners will choose between SEEP and Nabucco West by the end of June.