 |
| The world's biggest Liquefied Natural Gas tanker Duhail crosses the Suez Canal in thei file photo |
Turkey made a smart move in December 2015 when it signed a Memorandum of Understanding (MoU) with Qatar to replace Russian gas with liquefied natural gas (LNG) from that Gulf country.
By showing Russia it can find alternative sources of gas supply, Turkey probably hoped to extract some concessions with regard to the role of Kurds in the future of Syria.
While Turkey inked the LNG deal to serve its own interests, Russia was taking some positive steps. In March, the Russian military began its partial pull-out from Syria. In another surprise move, Russia lifted the ban on flights to Antalya, a resort destination in Turkey popular with Russian tourists.
What made Turkey move towards Qatar was that Russia met 56% of Turkey’s gas needs and a long Russian ban on gas supply will severely affect Turkey.
So in December 2015, Turkish and Qatari officials signed a number of MoUs among which was the one that stipulated the supply of Qatari LNG to Turkey. The logic of this particular MoU, as provided by Erdogan himself, clearly indicates the Russia-centric nature of the ‘gas card’ Turkey is playing through.
Erdogan said: “As you know, Qatar Petroleum was to put in a bid to invest in the long-term development of LNG in Turkey. Due to the known developments in Turkey, they are studying what kind of steps they could take in terms of LNG, in particular, its storage. We expressed that we viewed their study positively. As you know, both the private and public sectors have LNG storage facilities.”
The ‘known developments’ clearly indicate Turkey’s troubled relations with Russia and the way Turkey’s too much dependence upon Russia could result in Ankara making some compromises with regard to its interests. Hence, the need to diversify sources of supply to reduce this dependence.
However, one cannot be sure of the extent to which Turkey can actually replace Russian natural gas with Qatari LNG. For one thing, Turkey does not have enough infrastructural capacity for regasification or storage volumes, equivalent to the annual amount of gas imports from Russia, i.e. 27 billion cubic meters a year.
According to an analysis by International Energy Agency (IEA), Turkey’s regasification capacity does not exceed 14 billion cubic meters/year, and the capacity of its LNG storage is limited to about 3 billion cubic meters.
Currently, Turkey has only two plants to gasify LNG and pump it to the gas network — one in Silivri, near Istanbul, and another at Aliaga, on the country’s western coast.
Turkey faces another major problem: It is able to store only 5% of the gas it consumes, the lowest storage capacity in the whole of Europe. Hence Turkey is seen as the country most vulnerable to a possible cut in supplies.
Why is Turkey still playing the ‘gas card’? This is not the first time Turkey is going to import gas from Qatar. They have done trade in the past too. This fresh agreement between BOTAS and Qatar Petroleum reflects Turkey’s growing demand for energy. During the past ten years, Turkey’s demand for natural gas has more than doubled, making it Gazprom’s second largest consumer after Germany. However, this has created a significant dependence of Turkey on Russia.
This dependence cannot be abruptly stopped. This is due to the nature of agreements signed between both countries. The take-or-pay clause has tied Russia and Turkey for at least 10 more years. Turkey’s contracts with Russia are long-term “take-or-pay” natural gas contracts that force Ankara to either take the contracted amount or pay the fine for the amount of unused gas. Neither can Russia stop the supply to Turkey nor can Turkey stop its gas import from Russia; and the Qatari gas will not change this situation.
Given that Turkey does not have enough capacity to replace Russian gas, the moves it has been making in terms of diversifying its sources of supply also indicate its attempt to put Russia under some pressure to extract some concessions from it in Syria, particularly with regard to the position of Kurds in the future of that country.
However, the extent to which it can secure its interests this way depends on the degree to which it can actually diversify its sources of supply. Qatari gas alone would not be enough for the reasons mentioned above.
Salman Rafi Sheikh is a freelance journalist and research analyst of international relations and Pakistan affairs. His area of interest is South and West Asian politics, the foreign policies of major powers, and Pakistani politics. He can be reached at salmansheikh.ss11.sr@gmail.com
(Copyright 2016 Asia Times Holdings Limited, a duly registered Hong Kong company. All rights reserved. Please contact us about sales, syndication and republishing.)
SOURCE
