Natural Gas in the Turkish Domestic Energy Market – Policies and Challenges: OIES paper: NG 82

Over the past 10 years or so Turkey has featured prominently in the various schemes to open a ‘fourth corridor’ of gas supply to the core European national gas markets. The grandeur of earlier visions has morphed into a pragmatic and initially more modest scheme to supply 10 Bcm/yr of gas beyond Turkey. With the Euro-centric political excitement around ‘Nabucco’ on the wane the importance of the Turkish gas market in its own right has been overlooked. In the post financial crisis period it should be noted that Turkey is the only significant European regional gas market to have shown strong growth post 2009 and its 45 Bcm consumption in 2012 places it on a par with France. With domestic production contributing only 2% of its requirements Turkey imports pipeline gas from Russia, Azerbaijan and Iran and LNG from a number of supplier countries. Its likely continued rapid gas demand growth raises challenges not only of project logistics and timings but also, given its geographic location, those of a geopolitical dimension. In addition to its long held aspiration to become a regional gas transit ‘bridge’ between Central Asia, Iran and Iraq and Europe, Turkey is also in the process of liberalizing its gas market, with mixed success to date. It seems a paradox that the important, fast growing gas markets are also those with least data and analysis available. This has certainly been the case with Turkey. I am especially grateful to Gulmira Rzayeva for this paper, which is possibly the only comprehensive one in the English language on the Turkish gas market in recent times. Her dedication in conducting in-country research and interviews with key figures is admirable and in keeping with the record of the Gas Programme of insightful research on highly relevant market developments in this increasingly interconnected world of natural gas.