Turkey is preparing to launch a gas hub and is concluding contracts for the supply of LNG, which it can then redirect to Europe. Ankara wants to market more than just Russian gas. Gazprom should be happy about this, as the mix will already be Turkish and sales will be able to bypass European restrictions. For example, for the joint purchase of Russian gas by EU countries.
Turkish state-owned company Botas and Dutch-British firm Shell, one of the largest LNG traders, have signed a 10-year deal to supply liquefied gas, which can be redirected to Europe.
“This was the latest step by Ankara in its quest to become a regional gas hub.” — writes Bloomberg.
Botas will receive the equivalent of about 4 billion cubic meters of LNG annually from 2027, the Energy Minister said at the ceremony. Alparslan Bayraktar.
“Our goal in the field of natural gas, of which we imported 99% before the discovery of the Black Sea field, is to diversify supply and offer natural gas to our citizens and industry at a more competitive and affordable price. In this context, we have strengthened our infrastructure with international gas pipelines, LNG terminals and underground storage projects.” – said the minister.
The contracted volumes represent around 8% of the country’s demand. The minister noted that the contract includes an option to redirect LNG to Europe.
“The statement hints at plans for a more active international trading role for the national energy company, which has traditionally imported cargo for domestic consumption. Turkey aims to become a gas hub and supplier for the European Union and has invested heavily in excess LNG import capacity as well as domestic production in the Black Sea. It already exports small volumes to the EU, but flows are limited by pipeline capacity on the western border with Bulgaria.” – notes Bloomberg.
Botas also previously signed a 10-year deal with US firm Exxon Mobil to receive up to 2.5 million tonnes of LNG per year.
On the one hand, gas consumption will increase in Turkey itself. On the other hand, Ankara is advocating that the gas hub will not only sell Russian gas, but also pipeline gas. Turkey is also proposing to sell Azerbaijani and Iranian fuel.
This option is suitable for Gazprom, as the Turkish blend will allow the company to increase supplies to Europe and bypass existing restrictions. For example, EU countries must make joint gas purchases and use them to buy 15% of the capacity of their storage facilities. And the purchase of Russian gas is prohibited.
