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Gas balance of Turkey

Oil&Gas Materials 29 December 2010 13:50 (UTC +04:00)

Azerbaijan, Baku, Dec. 29 /Trend, A.Akhundov/

Production and reserves of gas

According to information of the U.S. State Energy Information Administration's (EIA), the natural gas production of Turkey for the year 2008 has been 1.02 billion cubic meters. As of the end of 2009, 0.714 billion cubic meters of natural gas production was made. In 2009 the natural gas proved reserves were 8.57 billion cubic meters, while in 2010 it amounts to 6.14 billion cubic meters. According to BP statistical review of world energy, natural gas consumption of Turkey for the year 2009 was 32,1 billion cubic meters. The figure is less by 10.6 percent compared to the last year.

Trade figures

In January-November of 2010, the Turkish state pipeline company BOTAS imported about 28.98 billion cubic meters of gas to Turkey from various sources compared to roughly 30.2 billion cubic meters in January-November of 2009, according to data on BOTAS website. BOTAS imported more than 33.6 billion cubic meters of gas to Turkey in 2009 compared to about 37.8 million cubic meters in 2008.

According to 2009 annual report of Turkish Petroleum Corporation (TPAO), in the year of 2009, 5.25 billion cubic meters of gas (LNG) was imported to Turkey from Iran, 4.96 billion cubic meters - from Azerbaijan, 19.47 billion cubic meters - from Russia, 4.487 billion cubic meters - from Algeria, 0.9 billion cubic meters - from Nigeria, 0.78 billion cubic meters was imported by spot.

Some 615 million cubic meters of gas fall to BOTAS 's export operations in January-November compared to 645 million cubic meters of gas at the same period of 2009. About 721 million cubic meters of gas fall to export operation last year compared to 443 million cubic meters in 2008. This figure was 31 million cubic meters of gas in 2007.

About 27.9 billion cubic meters of gas were sold in January-November in 2010 on the Turkish domestic market compared about 28.7 billion cubic meters of gas in January-November of 2009.

More than 32 billion cubic meters of gas were sold in 2009 on the Turkish domestic market compared to more than 36 billion cubic meters in 2008. This figure amounted to 35.1 billion cubic meters in 2007.

Natural gas tariffs and sales prices

Gas sales tariff for eligible industrial customers which have signed gas sales agreement with BOTAS in 2010 are fixed: uninterruptible prices are 0.0287 dollar per TL/kwh, 0.3049 dollar per TL/Sm³, interruptible prices are 0.0284 dollar per TL/kwh, 0.3019 dollar per TL/Sm³. 

Gas sales tariff for distribution companies in 2010 are fixed: for household consumption - 0.3273 dollar per TL/Sm³, for eligible industrial consumption 0.3049 dollar per TL/Sm³.

Gas purchase agreements

BOTAS has eight gas purchase agreements with Russia, Algeria, Nigeria, Iran, Turkmenistan and Azerbaijan. Only the agreement with Turkmenistan is not in operation today.

First natural gas purchase agreement was concluded between the BOTAS and Soyuzgazexport of former issue (volume during the plateau period is 6 BCMA) in February 1986. LNG purchase agreement was concluded with Algeria (4 BCMA) in April 1988. LNG sales and purchase contract was signed with Nigeria (1.2 BCMA) for 22 years in November 1995. August 1996 natural gas sale and purchase agreement was signed with Iran (10 BCMA). In December 1997 a natural gas sales and purchase contract was signed with Russia (16 BCMA) for 25 years gas delivery beneath the Black Sea. 23 years natural gas sales and purchase contract was signed with Gazprom for gas delivery from western pipeline (8 BCMA) in February 1998. May 1999 30 years natural gas sales and purchase contract was signed with Turkmenistan (16 BCMA). In March 2001 15 years natural gas sales and purchase contract was signed with Azerbaijan (volume during the plateau period is 6.6 BCMA).

International projects

Baku-Tbilisi-Erzurum (BTE) Natural Gas Pipeline

Included among the elements of the east-west energy corridor and expected to transport the natural gas to be produced in the Caspian Region to Turkey, from there to the other European countries, the BTE Natural Gas Pipeline has been transmitting natural gas since July of 2007. Having a capacity of 20 billion m3 per annum, the BTE is aiming to meet the natural gas requirements of Turkey, in addition to partially meet the rapidly increasing gas requirement of the EU. In total nearly 10.8 billion m3 natural gas has passed through this pipeline, with 5 billion cubic meters of this figure being purchased in 2009.

Turkey-Greece-Italy Natural Gas Pipeline

One of the priority projects in the framework of sending gas to Europe is the Turkey-Greece Natural Gas Pipeline, planned to be extended to Italy for the continuation of the "Southeastern Europe Gas Ring". The first leg of the project that has two legs, the Turkey-Greece line was commissioned in November 2007. As of the end of 2009, 1.2 billion m3 of natural gas was exported through this pipeline. The next phase of the Southeastern Europe Gas Ring is the extension of the Turkey-Greece Natural Gas Pipeline to Italy with a pipeline to be passed through the Adriatic Sea. With the realization of the Italy connection, the amount of natural gas to be transported over the pipeline will increase to 12 billion m3/annum. It is planned for the Adriatic Sea passage that will provide the Greece-Italy connection to be completed by the end of 2013.

Russia-Turkey Natural Gas Pipeline (West Pipeline)

Entering Turkey at the Bulgarian border at Malkoçlar, following the Hamitabat, Ambarlı, Istanbul, Izmit, Bursa, Eskisehir route to reach Ankara, the Russian Federation-Turkey Natural Gas Pipeline is 845 km long. Around 7.8 billion cubic meters natural gas has been imported through this pipeline in 2009.

Eastern Anatolian Natural Gas Main Transport Pipeline (Iran-Turkey)

This pipeline aims to carry natural gas that will be purchased from origins in the east, mainly Iran to Turkey. Around 5.3 billion cubic meters natural gas has been purchased through this pipeline in 2009.

Russia-Turkey Natural Gas Pipeline (Blue Stream)

This project brings the natural gas to Turkey with a passage through the Black Sea from Russia. Around 9.5 billion cubic meters natural gas has been imported through this pipeline in 2009.

Arabic Natural Gas Pipeline Project

The project aims to transport Egyptian and Syrian natural gas to Turkey, via Jordan and Syria, and via Turkey to Europe. The section of the project up to the city of Homs in Syria has been completed. When the section up to the Turkish border is completed, the natural 35 gas networks of the two countries will be connected. Presently Jordan, Syria and Lebanon have already started to receive Egyptian natural gas from the pipeline. A memorandum of understanding was signed between Turkey and the Syrian Arab Republic concerning natural gas exportation and transportation on September 25th, 2009. This document aims to start negotiations on the sale of natural gas from Turkey to Syria and respective transit possibilities starting in 2011.

Nabucco Natural Gas Pipeline Project

Work is ongoing by the related companies at countries that are partners of the project, for the realization of the Nabucco Project that will extend over Turkey, follow Bulgaria, Romania and Hungary to reach Austria. The German Company RWE joined the project in February of 2008 as the sixth equal partner. The pipeline project that will have an annual capacity of 31 billion cubic meters, will make a significant contribution to Europe's diversity of sources and routes.

The Nabucco Project International Agreement was signed in Ankara on July 13th, 2009. The Project Support Agreement negotiations were started on July14th, 2009, with a plan to sign the agreement in the first quarter of 2010 with the completion of the work. The third meeting in the scope of the Project Support Agreement was carried out on 1-2 December 2009 and the final meeting was conducted at our Ministry on 11-12 February 2010.

Caspian Crossing Natural Gas Pipeline Project

It is intended for the natural gas produced in the fields south of Turkmenistan to be transported to Turkey with a Caspian crossing natural gas pipeline with the Turkmenistan-Turkey-Europe Natural Gas Pipeline Project, and then via Turkey to Europe. Along this line, a Framework Agreement was signed on October 29th, 1998 between the Presidents of Turkey and Turkmenistan for the realization of the Caspian Crossing Turkmenistan-Turkey- Europe Natural Gas Pipeline Project. According to the project, the agreement involves the transportation of; 16 billion m3 of the 30 billion m3 Turkmen gas to Turkey and 14 billion cubic meters to Europe.

Despite the fact that the above project was agreed upon before the discovery of the Azeri Shakh Deniz field, the project could not be initiated due to the status problem of the Caspian and the problems experienced between Azerbaijan and Turkmenistan concerning the sharing of the oil and natural gas fields taking place in the Caspian Sea. However, certain positive developments took place in this subject recently. The project is important for projects that are being developed to transport gas to Europe via Turkey.

Iraq-Turkey Natural Gas Project

The project was initiated for the purpose of developing natural gas fields in Iraq and the transportation of the natural gas thus produced to Turkey via a pipeline. As a result of the work done by a group consisting of TPAO-TEKFEN- BOTAS, the project started with the signing of agreements between our Ministry and the Republic of Iraq Ministry of Petroleum in Ankara during 1996. Delays took place in the realization of the project due to UN sanctions, investments could not be made and negotiations were interrupted. As a result of positive developments taking place recently, a memorandum of understanding was signed on November 20th, 2008 between TPAO, BOTAS and Shell Energy Europe B.V. covering cooperation in natural gas exploration, operation, transportation and marketing activities and work in this area is ongoing.

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