Russia’s Gazprom closes deal with Turkish companies

Gazprom Export agrees on natural gas deal with six Turkish companies

Photo by: Reuters
Photo by: Reuters

Gazprom Export and six Turkish private companies have agreed on a natural gas price which will be valid through 2016, said Gazprom late Wednesday.

Gazprom said in a statement that Bosphorus Gaz, Enerco Enerji, Bati Hatti, Kibar Enerji, Avrasya Gaz, and Shell Enerji all agreed with Gazprom after “constructive” conversations.

The Russian company said that natural gas supply continues in accordance with current contracts but didn't disclose the discount rate.

Elena Burmistrova, general director of Gazprom Export LLC, said, "We are pleased to have a deal with our Turkish trade partners. We expect to continue our cooperation in the Turkish natural gas market."

Earlier it was reported that Russia's Gazprom, which was in discussions with six Turkish private companies on Jan. 29, unilaterally cancelled the 10.25 percent discount applied on natural gas supplies from Gazprom as of this Jan. 1.

At the end of February, Gazprom also reduced daily natural gas supplies to Turkey by around 50 percent from Feb. 10 along the western line.

Turkish Energy Ministry sources told Anadolu Agency that Gazprom invoiced the January gas exports to Turkish private companies at a 10.25 percent higher rate than the previously agreed discounted prices, effectively cancelling the discount.

Turkey, which is the second-biggest consumer of Russian gas after Germany, imports around 30 billion cubic meters of gas from Russia annually via two pipelines: the Blue Stream and the western line. The private sector in Turkey imports 10 billion cubic meters (bcm) of natural gas per year, representing over 30 percent of Russia's gas exports to Turkey.

Out of 48 bcm, 38 bcm was imported by Turkey’s state-owned crude oil and natural gas pipeline and trading company BOTAS. Gazprom was due to enforce the 10.25 percent discount with BOTAS, but the company confirmed that this was never applied.