Page 8 - MEOG Week 08 2021

MEOG PIPELINES & TRANSPORT MEOG

(20%), Snam (20%), Fluxys (19%), Enagas (16%) Turkey’s imports and consumption
and Axpo (5%). Turkey imported 45bcm of natural gas in 2019,
Also in January 2021, Gazprom delivered gas marking a 10% y/y decline. In January-Novem-
to Serbia and Bosnia via TurkStream, which has ber 2020, gas imports rose 5% y/y to 42bcm.
an annual capacity of 31.5bcm. Russia remained Turkey’s largest supplier
Russia is also working on building up its Nord with 13bcm, or a 32% share of the market (34%
Stream pipelines to Europe to an overall capac- in 2019), followed by Azerbaijan with 10bcm, or
ity of 110bcm. Nord Stream II will have a 55bcm 25% (21% in 2019), and Iran with 4bcm, or 10%
capacity, but its construction has been held up (17% in 2019). Turkish gas imports from Russia
by sanctions imposed by the US, which claims it slumped by more than a third last year to 16bcm
amounts to a bad deal for Europe given the Euro- in 2019. In January-November, they declined
pean need not to be over-reliant on Russia for its further by 1% y/y. Imports from Azerbaijan were
energy supplies. It will complement the already up 21% y/y in January-November.
operational 55bcm Nord Stream I. In January-November 2020, some 67% of
natural gas was transferred through pipelines
Market (72% in 2019), while the market share of LNG
According to Gazprom’s preliminary estimates, was 33% (28% in 2019). In the LNG category,
global gas demand last year fell by 2% to 4 tril- Algeria was the largest supplier with 5bcm in
lion cubic metres. The key trends in the global January-November 2020 (up 1bcm), while Qatar
market are a production decline in Europe and rose to second place with 3bcm.
consumption growth in China. Natural gas consumption in Turkey dropped
Gas production in Europe declined 7% y/y to 8% y/y to 45bcm in 2019. In January-November
220bcm in 2020 and consumption in China grew 2020, it rose 6% y/y to 42bcm. In January-No-
6% y/y to 325bn, Gazprom estimated. Europe vember 2020, residential units’ consumption
each year consumes about 500bcm of gas. Gaz- accounted for some 31% of all gas consumption
prom’s sales declined 8% y/y to 210bcm in 2020 (32% in 2019), while the share of power plants
with sales down 14% y/y to 46bcm in biggest was 29% (21% in 2019), or 12bcm, up 34% y/y.
market Germany. Exports to Turkey, its fourth On January 1, Botas hiked natural gas prices
largest market, were down 6% y/y to 16bcm. by 1% to Turkish lira (TRY) 1,264 ($181) per
1,000 cubic metres for homes and to TRY1,414
Iran contract ($202) for industry and power plants.
On February 14, official Iranian news agency Turkey’s energy watchdog also hiked electric-
IRNA quoted the country’s deputy oil min- ity prices by 6% for all types of consumers.
ister, Amirhossein Zamaninia, as saying that In July, Botas cut natural gas prices for indus-
the National Iranian Gas Company (NIGC) try and power plants by between 9.7% and 12.5%
has started negotiations with Botas to renew a after natural gas plants were troubled by long-
30-year natural gas contract that expires in 2026. term gas supply contracts and the fall in electric-
“Securing a long-term deal will not be as easy ity prices amid the pandemic.
as the one signed in 2001 because now Ankara Electricity production at natural gas plants
has a larger range of suppliers to choose from. fell to 1,537GWh, or 8% of Turkey’s total pro-
Turkey is emerging as a more adept gas con- duction, in April before rising to 8,293, or 32%,
sumer and negotiator,” Zamaninia has said. in November. As of January, natural gas plants
Talks were supposed to be launched in 2020 had the highest share of 25,688MW (27% of total
but were postponed due to the coronavirus crisis. capacity), up from 25,673MW at end-2020, in
Given the nature of long-term international Turkey’s overall 96,271MW of installed electric-
agreements, such talks are normally intercon- ity generation capacity. In 2020, gas plants pro-
nected with foreign policy issues and geopoliti- duced 69,331GWh of electricity, or 23% of total
cal considerations, according to Zamaninia. production, up 21% y/y.™

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