Page 6 - MEOG Week 42 2021

MEOG PIPELINES & TRANSPORT MEOG

Turkey concludes Azeri gas deal

TURKEY TURKEY has concluded a three-year natural Ankara, saying Russian pipeline supplies would
gas deal for 11bn cubic metres (bcm) with Azer- shield Turkey from the gas crisis.
baijan, energy minister Fatih Donmez said on As 2021 progressed, Turkey attempted to gain
October 15. more leverage in renegotiating long-term gas
Donmez added that the agreement was for contracts by pointing to the rising availability
the delivery of the gas via the Baku-Tiflis-Erzu- of LNG from the US and other sources. How-
rum pipeline until end-2024. He rejected what ever, when the gas supply crunch started causing
he claimed were efforts to paint a picture of Tur- major difficulties for Europe and other big gas
key facing an energy problem amid the global buyers amid the economic rebound from the
energy shortfalls. coronavirus crisis, Turkey somewhat changed
Claims that Turkey was purchasing gas at its tack and increased efforts to seal new pipeline
expensive rates were also refuted by Donmez, deliveries.
who also went on to deny reports that state Turkey was also coming to rely on a steady
energy companies Turkish Petroleum (TPAO) increase in hydroelectric power, but prolonged
and pipeline operator BOTAS are to be sold off. drought conditions have undermined that sec-
Turkey’s is facing record demand for nat- tor’s contribution to the grid.
ural gas this year amid the economic bounce Turkey consumes between 45 bcm to 50 bcm
back from the coronavirus crisis. That is forcing of gas per year, paying between $12bn and $15bn,
Ankara to step up purchases on a surging spot but with idled gas plants brought back online to
market. compensate for the mothballing of hydroelectric
With winter approaching, time is running facilities, consumption could surge to a record
short for Turkey’s energy officials as they negoti- 60 bcm this year, according to pro-government
ate amid the energy crisis to roll over three long- publication Daily Sabah. Turkey imported 48.1
term gas import contracts that expire before the bcm of gas last year, up 6% y/y. One-third came
end of the year. from Russia. Iran (pipeline) and Algeria (LNG)
Two contracts relate to Russian pipeline gas are other suppliers.
shipments of 4bn cubic metres (bcm)/year each, Turkey may have to renew all the expiring
while a third contract, which expires this month, long-term gas contracts with at least the same
concerns 1.3 bcm/year of Nigerian liquefied gas volumes to meet demand.
(LNG). It may also have to top up its supply with
A meeting two weeks ago in the Russian Black expensive LNG, importing a little shy of 13 bcm
Sea resort of Sochi between Russian President of LNG from spot markets now seeing sky-high
Vladimir Putin and Turkish President Recep prices, the newspaper also noted. Spot LNG
Tayyip Erdogan ended without the conclusion imports so far this year stood at 2 bcm, official
of a gas deal. Putin, however, tried to reassure data showed.™

P6 www. NEWSBASE .com Week 42 20•October•2021