TURKEY: GAS MEGA HUB
Turkey is on its way to becoming the main hub for energy in Europe due to the recent introduction of the Turk Stream in place of South Stream. The elevation of the country's role became feasible after a series of major infrastructure projects that will certainly make Turkey the corridor for the supply of gas into the EU for the coming decades.
Already in terms of oil supply the Baku-Tbilisi-Ceyhan pipeline has been operational since 2000 with a capacity of 1 million barrels of oil per day. It is the main axis for the opening up of the Caspian market to the international terminals, elevating Ankara's posture in the West and especially the US, which fervently lobbied for this energy corridor as an alternative to Russian-owned routes.
The Kirkuk-Ceyhan oil pipeline is the one connecting Iraq with the international markets via Turkey with a maximum capacity of 1.6 million barrels, making it the main export corridor for the Iraqi oil. Recently it was announced that its capacity is planned to be enchased, which further cements Turkey's role in oil transfer politics of the Middle East.
Since 2007 the Baku-Tbilisi-Erzurum natural gas pipeline is operational and has been interconnected with the Greek gas transmission system in the first successful attempt to open up the Southern Corridor. With a maximum capacity of 25 bcm per annum, it is the backbone of the currently formed Trans-Anatolian Pipeline (TANAP), a $50 billion project which will open up the Shah Deniz field to the EU markets and will become the axis from where any potential further Central Asian projects such as the Trans-Caspian route will become accessible.
The Trans-Adriatic Pipeline (TAP) along with the Ionian Adriatic Pipeline (IAP), that will connect Turkey-Greece-Albania-Italy and also Montenegro, Bosnia and Croatia, are also feasible due to the existence of the aforementioned and can be classified as 'mega-spurs' of TANAP.
The aforementioned projects have been "blessed" by energy security policy makers primarily in Washington and Brussels as key routes for the diversification of supplies in contrast to Gazprom's dominance in EU deliveries. Nevertheless the new Turk Stream project is to couple itself with the already existing 16 bcm Blue Stream pipeline which is Gazprom's route to Turkey via Black Sea and which is set to increase to 19 bcm in the coming years.
Thus with the available data so far, the Turk stream would be a new addition, for up to 60 bcm that will land into the European part of Turkey, close to Istanbul and will then have to be connected with Europe's transmission systems, a version of the cancelled South Stream, but compliant with the EU Third Energy package.
In the meantime the Tabriz-Ankara gas pipeline between Iran and Turkey is operational with a maximum capacity of 14 bcm per year that can be easily interconnected with all the above. Turkey is also striving, albeit with a forceful manner to get a hold of the offshore reserves in East Mediterranean and be able to launch a pipeline that will attract Cypriot/Israeli offshore fields into its own domestic transmission system. Last but not least the existing Bulgaria-Turkey gas interconnector supplies the latter with a maximum capacity of 16 bcm per year, which is Russian gas originally traversing Ukraine and then Southwards to the Balkans. The Turk Stream pipeline will effectively render this route as non-viable for Turkish imports nevertheless, it is a well-placed infrastructure that will remain so.
Therefore, Turkey has already become the unquestionable gas hub in Europe, having diversified supplies from Russia, Azerbaijan, and Iran with possible central Asian input in the coming years. In total, Turkey stands to have a maximum capacity in its territory of around 110 bcm per year, along with around 3 million barrels of oil per day, which can be further increased by any new deals with Iraq and Iran and any positive developments for Ankara regarding the East Med.
Turkey's energy infrastructure still lacks large-scale storage capacities for natural gas. Underground natural gas storage may contribute to seasonal balance, daily and hourly changes in demand and is essential to maintain the gas flow to the consumer in the event of supply interruptions. The first underground storage facility in Turkey, with a capacity of 2.6 bcm, became operational in April 2007 in Silivri, near Istanbul. A second underground storage facility, in Tuzgölü in Central Turkey and with 1 bcm capacity, is under development.
Due to rate of increase of consumption of gas within Turkey which is set to become the largest market in Europe by 2025, a set of new storage facilities is needed, which will also enchase the country's mega-hub role. Of course all of that diminishes relevant projects in neighboring stagnant markets such as Greece and Bulgaria while they will consequently interact and affect all gas strategies in Southeastern Europe, characterized by rather small and fragmented markets. In all senses, Turkey is becoming a vital pillar for Europe's energy security.
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