August 3, 2016

by AEA in News

Turkey’s energy role to continue after coup attempt

Turkey’s role as a key strategic energy actor in its region is expected to continue without much negative impact from July 15 failed coup, experts told Anadolu Agency Wednesday.

“Turkey’s regional energy role remains a key element of Turkey’s economic dynamism,” said David Merkel, a senior fellow at Dinu Patriciu Eurasia Center of the Washington-based Atlantic Council.

“If Turkey returns to stability and has competent officials in energy-related agencies and ministries, I suspect the impact [of the coup attempt] will be minor,” he added.

The coup attempt on July 15 has brought questions to ongoing energy projects in the country which acts as a strategic bridge between the gas-rich Caucasus and energy-hungry Europe.

Experts said that Turkey’s key position in between these two regions will not be affected by the failed coup attempt.

“Turkey’s importance for European energy security will not be significantly reduced,” Merkel said.

“I think Turkey is too critical to European energy security, especially in efforts to reduce dependency on Russia for Europe,” he added.

Around 30 percent of Europe’s annual natural gas consumption is dependent on Russian supplies. Europe has been trying to lower that dependency through diversification, and Azerbaijan’s gas resources in the Shah Deniz field as a major supply source have contributed to this aim.

Turkey’s Trans Anatolian Natural Gas Pipeline Project (TANAP) is an integral part of the Southern Gas Corridor that plans to carry Azeri gas via Georgia, Turkey, Greece, and Albania through to Italy. TANAP is planned to become operational in 2018 with an initial capacity to carry 16 billion cubic meters (bcm) of gas. Total capacity is planned to increase to 23 bcm by 2023 and to 31 bcm by 2026.

Volkan Ozdemir, head of the Institute for Energy Markets and Policies (EPPEN) said TANAP will continue as planned, and added that most of its investment comes from Azerbaijan.

“Investments in Turkey’s energy sector have not come from Europe in recent years. It is mostly foreign investors outside Europe that finance it,” he said.

Rapprochement with Russia

Although Merkel said Turkey’s key regional position would help European energy security by lowering its dependence on Russian gas, Ozdemir highlighted the fact that Turkey and Russia’s recent attempt at reconciliation after relations soured last November, could indirectly affect Europe.

“If the Turkish Stream gas pipeline project comes back on the agenda, this could have an indirect impact on Europe,” Ozdemir said.

He added that there are two conditions for the Turkish Stream project being taken off the shelf — the rapprochement between Turkey and Russia, and the impact of the Nord Stream II pipeline project coming online.

The Nord Stream II project plans to deliver 55 bcm of Russian gas under the Baltic Sea to Germany, and further into France, the U.K., the Netherlands and Denmark.

The Turkish Stream, which was initially planned to carry 63 bcm of gas to Europe via Turkey, had its project capacity trimmed down to 31 bcm later on. However, the project was shelved after Russia and Turkey failed to agree on the existing gas price discount which Russia was due to apply on Turkey’s gas imports. Turkey’s downing of the Russian jet last November, worsened bilateral relations leaving a stalemate in talks on the project between both sides.

“If a decision to build the Nord Stream II is taken, Russia will scrap the Turkish Stream,” Ozdemir warned, adding that “relations between Russia and Europe remain uncertain.”

“I believe, Turkey and Russia will get closer again after the failed coup attempt. And if the two countries can agree on building the Turkish Stream, Russia will be able to have another gas route to Europe through a southern corridor. That is something Europe would not want,” he explained.

Ozdemir asserted that relations between Turkey and Europe are uneasy. He added that with a potential Ankara Moscow reconciliation on the agenda, the realization of the Turkish Stream project is more likely than the Nord Stream II.

“I think a period has begun that will benefit Turkey, but will be unfavorable for Europe,” he concluded.

By Ovunc Kutlu and Ebru Sengul

June 19, 2015

by AEA in News

Russia, Greece sign deal on Turkish Stream gas pipeline

Russia and Greece have signed a deal to create a joint enterprise for construction of the Turkish Stream pipeline across Greek territory, Russian Energy Minister Aleksandr Novak said. The pipeline will have a capacity of 47 billion cubic meters a year.

The Greek extension of the Turkish Stream project is called the South European pipeline in the memorandum signed on Friday, Novak said at the St. Petersburg Economic Forum. Construction will start in 2016 and be completed by 2019.

The two countries will have equal shares in the company, Novak added.Construction of the pipeline in Greece will be financed by Russia, and Athens will return the money afterward.

Greek Energy Minister Panagiotis Lafazanis said the Friday meeting was“historical “.

“The pipeline will connect not only Greece and Russia, but also the peoples of Europe,” Lafazanis was quoted as saying by Sputnik news agency. “Our message is a message of stability and friendship… The pipeline we are beginning today is not against anyone in Europe or anyone else, it is a pipeline for peace, stability in the whole region.”

Source : rt.com

May 11, 2015

by AEA in News

Russia And Turkey Agree To Route For New Turkish Stream Pipeline Through Black Sea

ISTANBUL — The U.S., the European Union and Russia are locked in an energy battle, and its outcome depends almost entirely on one country: Turkey. The construction of a new pipeline through the Black Sea to Turkey could tilt the balance of that game should countries such as Greece sign on to the new Russian-backed project.

At diplomatic meetings and energy conferences throughout the Middle East, Europe and Asia, Turkish officials have for the past several months promoted their country as a reliable, stable energy conduit in the region, the only one that can provide energy security in a turbulent part of the world. The Turkish government has been making the case that it is best positioned, both geographically and politically, to find a solution to Europe’s energy problem — the continent depends largely on Russian natural-gas exports for energy, even as it is locked in a confrontation with the country over its role in the eastern Ukrainian war.

Turkey is gaining from this Western conundrum. It is participating in pipeline projects that benefit both Russia and the West.

The proposed pipeline called the Turkish Stream was catapulted into its next planning stage this week when Ankara and Moscow agreed on the route for the 700-mile pipeline, which could begin delivering oil as early as December 2016. The pipeline will run from Russia through the Black Sea to the Greece-Turkey border.

Russian state-owned energy giant Gazprom announced this week that it had reached a deal with the Turkish government on the construction of the pipeline. Gazprom is Europe’s biggest natural-gas supplier.

“We have identified and put on the map also the on-ground passage of the Turkish Stream gas pipeline for further exploration and project work,” Gazprom CEO Alexey Miller said in a statement in February.

The U.S. and its European allies are attempting to dissuade Greece and Serbia from signing on to the project as transport countries because they worry it would give Russia even greater energy dominance in the region.

“Turkish Stream doesn’t exist. There is no consortium to build it, there is no agreement to build it,” Amos J. Hochstein, U.S. special envoy for energy affairs, said after talks with Greek officials, Reutersreported Friday. The U.S. wants Greece to continue to support a pipeline it has already agreed to host — the Trans Adriatic Pipeline, aka TAP.

“Focus on what’s important — the pipeline we already agreed to, that Greece already agreed to,” Hochstein reportedly said.

Turkey is also a key player in TAP. Still in the planning phase, the pipeline would start at the Turkey-Greece border and extend through Greece and Albania to Italy. Once constructed, it would connect to another project, the Trans-Anatolian Pipeline, which also depends on Turkey’s cooperation and support.

The $11 billion Trans-Anatolian Pipeline would cross the entire length of Turkey’s Asian landmass. The pipeline would begin at the Georgia-Turkey border and pass to Greece through Anatolia, as Turkey’s Asian territory is known. It would not be completed until 2019.

The announcement about the Turkish Stream came after Gazprom and Turkey’s Botas Petroleum Pipeline Corp. signed a memorandum of understanding on the construction of the pipeline in December.

The Turkish Stream is the result of the cancellation of South Stream, a pipeline plan that Russia and Turkey had agreed on, but that the European Commission opposed. The executive arm of the European Union rejected Gazprom’s plans for the pipeline because it was not in line with EU laws. The pipeline would have transported Russian gas to southeastern Europe via Bulgaria, and supplied Slovenia, Serbia, Hungary and Italy with natural gas.

A Financial Times report said the Turkish Stream would deliver 16 billion cubic meters of gas a year for domestic consumption in Turkey.

The Turkish Stream would reach Turkey in the village of Kiyikoy, and the delivery hub would be close to the town of Luleburgaz, while the pipeline would terminate on the Turkish-Greek border in the area of Ipsila.

Turkish Stream pipeline route. Source: Gazprom

It is unclear which companies will transport the natural gas to Europe from the Greek border. Analysts say heavily indebted Greece does not have the resources available to invest in the pipeline network needed for transportation.

Russia said Friday it was considering extending funding to Greek companies that want to join the project and deliver gas to Europe. According to a Kremlin statement, Greek Prime Minister Alexis Tsipras said his country was ready to participate with a public company.

However, Serbia is not ready to participate. President Tomislav Nikolic said Friday the country would not receive gas through the pipeline.

“We have presented to all European officials our position that now we do not agree with the imposition of sanctions against Russia, but when we become a member [of the EU], we will have to conduct a common foreign policy,” Nikolic said in an interview with the news agency Interfax.

Although the Turkish Stream pipeline is in the initial stages, the European Commission could still stop its construction or prevent prospective buyers from investing in it.

EU Energy Union Vice President Maros Sefcovic said in a statement last month the best option to ensure energy security was the development of the Southern Gas Corridor, which would bring gas from Central Asia.

By Erin Banco @ErinBanco [email protected]