EU’s position on Turkish Stream may constrain project implementation

Oil&Gas Materials 19 July 2016 18:31 (UTC +04:00)

Baku, Azerbaijan, July 19

By Aygun Badalova - Trend:

Despite the willingness of Turkey and Russia to implement the Turkish Stream gas pipeline project, the position of the EU may be the main constraint for it, Cyril Widdershoven, Middle East geopolitical specialist and energy analyst, partner at Dutch risk consultancy VEROCY and SVP MEA-Risk, believes.

“The current situation indicates that Russia wants to restart the overall project. Some discussions already have been held, but outcome is unclear. Full scope of discussions is also not clear, but it seems that both parties are willing to restart the project, as Ankara and Moscow are again on speaking terms,” Widdershoven told Trend July 19.

The Turkish market’s need for additional gas is clear, but the project’s full success, however, will depend also on the ongoing price discussions and possibility to transport part of the volumes to European countries, the expert believes.

“Main constraint for both parties will, however, be the position that the EU will take,” said Widdershoven.

“In the light of Gazprom's growing hold on European gas imports, this could be the main issue. It also could conflict or constrain ongoing discussions on Nord Stream 2, as both projects are filling in some of the European gas demand, while both also are blocking parts of current gas transport via Poland or Ukraine,” he added.

The Turkish Stream project, which is meant to take the Russian gas to Turkey across the Black Sea, was suspended due to sharp deterioration of relations between Moscow and Ankara after the incident involving the downed Russian air bomber in November 2015.

After normalization of the bilateral relations in June, Russian Gazprom spokesman Sergey Kupriyanov said Gazprom is "open for a dialogue" on the Turkish Stream project.

Widdershoven believes that the current situation in Turkey is not positive for the project.

The recent military coup attempt in the country, threat of death penalties, or other issues will not be taken very lightly in Brussels and other European capitals, expert believes.

On July 15 evening, Turkish authorities said a military coup attempt took place in the country. Meanwhile, a group of servicemen announced about transition of power to them. However, the rebelling servicemen started to surrender July 16 and Turkish authorities said the coup attempt failed. Over 200 people have been killed in Turkey as a result of the coup attempt.

“A new rapprochement between Moscow and Ankara is foreseeable, but could dent the already fledgling support from Brussels and European leaders for further cooperation,” said Widdershoven.

He added that the Turkish Stream is among the projects that are expected to be a part of the discussions in Germany, France, the Netherlands and other countries during upcoming elections.

“The coup attempt of last weekend doesn’t bode well,” he said.