“Turkish Stream” difficulties

Business Materials 8 July 2015 08:00 (UTC +04:00)
Seven months have already passed since the birth of the idea of ​​the “Turkish Stream” project.
“Turkish Stream” difficulties

Baku, Azerbaijan, July 8

By Maksim Tsurkov - Trend:

Seven months have already passed since the birth of the idea of ​​the "Turkish Stream" project.

However, the idea remains only an idea for now, despite the fact that Russia is actively trying to show its feasibility.

The Turkish Stream, as it is known, is the successor to the South Stream, a pipeline bypassing Ukraine, which was supposed to deliver Russian natural gas to Southern Europe. However, faced with the inaction of the European side, Moscow had to shut down such a promising project.

However, the Gazprom (global energy company) couldn't resist the temptation to put pressure on Europe and decided to act differently. The route of the project, its concept and name were changed, but not the essence. Though the Turkish Stream should go through Turkey and end in a hub in Greece, it still involves the delivery of Russian gas to Southern Europe. However, the project faced some difficulties in its implementation.

Countries that should become partners of Russia on the Turkish Stream, first expressed interest in participating in the project. The new left-wing Greek government expressed its interest in the Turkish Stream so much that it nearly abandoned the already signed agreements on the Southern Gas Corridor, while Turkey acted in a more modest way, at the level of oral statements.

When it came to the issue of the price for supplied Russian gas to Turkey, the future of the project became no longer so rosy. The parties didn't agree on the price, Russia showed a certain adherence to principles, while Turkey applied to the arbitration court. It is not known when this issue will be resolved, and no doubt, the reconciliation process will be delayed for a long time, and that ties Gazprom by hand and foot regarding the further actions on the project.

Moreover, Turkey has not issued a permit yet for the construction of the pipeline on its territory. This situation is almost identical to the South Stream. Russian President Vladimir Putin made a statement about the refusals.

"We can not begin construction at an offshore section until we get the permission from Bulgaria," he said. "To start construction at an offshore section, reach the Bulgarian shore and stop the work is ridiculous." In this regard, Gazprom's statement about launching the construction of the pipeline in the Black Sea without a document of the Turkish side's consent is also absurd.

The political situation in Turkey also adds fuel to the fire. The impact of the results of the country's recent parliamentary election on the Turkish Stream is unpredictable and can affect it quite negatively.

It has been recently reported that Gazprom has suspended work on the capacity expansion project, associated with the Turkish Stream. This information looks completely nonrandom in such a situation.

The project involves an increase in gas supply to the central and southern regions of Russia, as well as the supply of gas to the main Turkish Stream gas pipeline. It had to happen through the construction of 10 compressor stations and two branches of gas pipelines (western and eastern routes) with a length of 2,500 kilometers in total, capable of supplying 63 billion cubic meters of gas per year. And the suspension of such important work for the project means that the Russian gas monopolist slightly relaxed its vigilance over the Turkish Stream.

Given all these factors, the risk of the Turkish Stream to repeat the situation with its predecessor becomes extremely high.

Edited by CN

Trend commentator Maksim Tsurkov

follow the author on Twitter: @MaksimTsurkov