Turkey has announced the largest gas discovery in the country’s history as it attempts to wean itself off energy imports.
Turkey’s President Recep Tayyip Erdogan has announced a major energy discovery in Turkey’s Black Sea region with a 320 billion cubic metres gas field, the largest in the country’s history.
Erdogan went on to say that the gas field will be operational by 2023, which also marks the 100 year anniversary of the Republic’s establishment.
Turkey’s economy is heavily reliant on imports to meet its energy needs which has often resulted in pressure on the Turkish lira’s value. One study suggested that by the 2020s Turkey will need to import as much as 75 percent of the energy it needs.
Over the last 15 years, Turkey has had the highest rate of growing energy demand amongst countries in the Organisation for Economic Co-operation and Development resulting in an energy import bill that stood that at $41 billion in 2019.
The government has made clear, however, that Turkey’s foreign energy dependency need not be its “destiny”.
Turkey’s energy exploration initiatives in the Easter Meditterenean and in the Black Sea have been driven in part to wean the country of costly energy dependency.
So what does Turkey’s present energy landscape look like
Over the last three decades, gas has become a significant mix of Turkey’s energy demand accounting for more than 30 percent of the country’s energy needs.
In 2019 the country imported 46.83 billion cubic meters of gas, mainly from Russia. In 2020, however, there has been a marked decrease in Russian gas imports with Azerbaijan taking the lead.
Russia’s main gas provider Gazprom was pushed from its perch as Turkey’s main supplier of gas in 2020 with imports declining by 72 percent. Gazprom’s share of Turkey’s gas imports fell from 33 percent to below 10 percent in 2020.
Ankara’s close ally, Azerbaijan has become the country’s number one gas supplier in 2020, accounting for 23.45 percent of the total volume of gas supplies to Turkey.
Turkey’s imports of Liquified Natural Gas (LNG) have also increased significantly over the past year surpassing gas delivered through pipelines with a 29 percent share of the market.
As the price of LNG has dropped, Turkey has increased imports from the US by 300 percent in March of this year compared to the same time last year. Qatar was also one of the biggest exporters of LNG to Turkey.
Turkey strives for exploration independence
The country, Erdogan said, had made the discovery through its efforts while in the past millions had been spent on outside firms with little to show.
Turkey decided in 2011 that investing in its own exploration and drilling ships was the only suitable path towards ensuring an economical approach to exploration.
The three ships are operating in the Eastern Mediterranean and the Black Sea. Turkey sees the ships as part of an effort to ensure that it can strategically operate the vessels without potential foreign interference.
The Turkish government has been acutely aware that reliance on one outside source of gas has economic and strategic implications.
While the announcement today is not a silver bullet, it does help Turkey reduce its dependency on outside providers.
The Turkish government has implemented a national energy and strategic mining policy which would move the country away from external reliance and towards internal energy production. One way the government has attempted to do this is by integrating the local energy market.
Turkey is also aiming to become a trader in gas by making use of the pipelines that go through its territories, and by reducing its gas dependency, it wants to be able to sell excess gas.