Page 15 - DMEA Week 33 2022

DMEA NEWS IN BRIEF DMEA

POLICY & SECURITY

Energy costs boom widens

Turkey’s current account
deficit by 191% y/y in June

Turkey’s current account deficit in June officially
expanded by 191% y/y, with booming energy
costs linked to impacts of the Ukraine war an
obvious driver. The Turkish economy is almost
entirely reliant on imports to meet its oil and gas
demand.
The gap was posted at $3.46bn.
Turkey expects its full-year 2022 energy
import bill to cross the $100bn threshold. That
would roughly represent a fourfold increase on
last year’s cost.
“The trade deficit is near record levels, push-
ing the current-account deficit wider even at a
time when the tourism sector is supposed to be
at its strongest,” strategist Murat Toprak said in a
report released by HSBC earlier this week. Azerbaijani pipeline that delivers oil to Turkey’s post-Soviet country’s lack of support for Russia’s
The latest data also showed the June goods Mediterranean port of Ceyhan via Georgia. Ukraine policy by reminding Kazakhstan who is
trade gap at $6.43bn versus $1.63bn in June last The deal in the making, if signed, would boss when it comes to the CPC oil export route.
year. Services provided a $4.02bn surplus, with reportedly permit a flow of 1.5mn tonnes per In July a Russian court threatened to shut the
Turkey experiencing a huge post-Covid tourism year (tpy), or just over 30,000 barrels per day CPC over environmental matters. Prior to that
revival. That’s an essential indicator for Turkey, (bpd), through the Baku-Tbilisi-Ceyhan (BTC) there were disruptions to its oil export activi-
given tourism accounts for around a tenth of pipeline from the end of September. ties caused by an announcement of apparent
GDP. That compares to the usual 1.3-1.4mn bpd mine-clearing operations and claims of terminal
Net portfolio outflows were given as $1.58bn. (around 1% of world supplies) that flows through damage caused by stormy weather.
FDI inflows were recorded as $950mn. the CPC Consortium pipeline that runs from bne/IntelliNews, August 13 2022
In the net errors and omissions column, Kazakhstan to Russia’s Black Sea Novorossiisk
which represents capital movements of oil export terminal. QatarEnergy awards
unknown origin, officials pencilled a monthly Whether Kazakhstan and Azerbaijan could
inflow of $3.98bn. The column’s January-June agree to relatively quickly expand the 30,000 McDermott FEED contract
inflow entry showed $17.5bn. bpd volume is in serious doubt. The difficulty
bne/IntelliNews, August 11 2022 lies in getting Kazakh oil across the Caspian Sea for the North Field South
to Azerbaijan. It is well-known such plans would
face a distinct lack of the required tankers plying offshore pipelines project
PIPELINES routes on the sea, the world’s largest landlocked
body of water. Nevertheless, two of Reuters’ McDermott International has been awarded a
Kazakhstan reportedly sources also referred to talks on the possibility of Front-End Engineering Design (FEED) con-
another 3.5mn tpy (70,000 bpd) of Kazakh crude tract by QatarEnergy for the North Field South
makes modest progress being sent through the Azerbaijani pipeline that (NFS) Offshore Pipelines and Power/FO cables
runs to Georgia’s Black Sea port of Supsa from Project. The new contract is in addition to the
in finding alternative next year. awards received by McDermott this year for the
Kazakhstan has stepped up its efforts to find NFS Jackets and Topsides and Pipelines for the
crude oil export routes oil export routes not dependent on Russian ter- North Field Expansion Project (NFXP).
ritory amid political tensions that have emerged
The NFS infrastructure is part of the NFXP
Kazakhstan has made progress with its plans since Russia invaded Ukraine in late February. development and is designed to supply feed gas
to find alternative oil export routes that bypass Nur-Sultan has not backed Moscow’s war in for two additional LNG trains and help increase
Russia. Ukraine — indeed, it has been noticeably cool total LNG production in the State of Qatar from
However, advanced discussions between about it — nor has it recognised the self-declared, the current 77mn tonnes per year (tpy) to 126mn
Kazakhstan’s state oil firm KazMunayGaz so-called people’s republics in conquered parts tpy.
(KMG) and the trading arm of Azerbaijan’s of eastern Ukrainian territory. That has caused “McDermott is one of the most experienced
state energy firm Socar — as reported by Reu- some friction and some jitters among Kazakhs engineering and construction firms serving the
ters on August 12, which cited three anonymous in the face of nationalist statements from some LNG market and has delivered more than 30
sources familiar with the matter — only concern Russian figures that at least North Kazakhstan LNG Pre-FEED and FEED projects over the past
an agreement that would allow no more than a should be made part of Russia. ten years,” said Tareq Kawash, McDermott’s Sen-
relative trickle of Kazakh crude to be sold via the Russia appears to have responded to the ior Vice President, Offshore Middle East.

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