This epitomizes today’s LNG-geostrategic nexus.
One way to look at the Turkey-Shell LNG deal is that Mr. Erdogan wants Turkey to avoid Germany’s blunder in relying heavily on Putin’s Russia for its imported natural gas. He obviously wants Turkey to diversify its natural gas imports. In this regard, the opening comment by Tom Marzec-Manser, head of Gas Analytics at ICIS, London, that “this is a big deal” for Turkey – is correct.
Turkey uses about 50 bcm (billion cubic meters) of natural gas per year. This is currently supplied almost entirely via pipelines, mainly from Russia, also from Iran and from Azerbaijan. As I pointed out, Mr. Erdogan is well aware how Putin cut off German and EU Russian gas supplies as a geostrategic weapon in preparation for his full-scale invasion of Ukraine. This plunged Germany and the entire EU into the acute 2022-2023 European energy crisis. Germany, especially, still has not fully recovered.
Earlier this year, the Turkish energy minister, Mr. Bayraktar, announced that Turkey would seek to sign LNG import deals to build up a portfolio of alternative supplies. These would amount to about 10-12$ of the 50 bcm it imports. So far the new deals have included Exxon, an Omani company and most recently Shell.
Shell, beginning in 2027, will deliver 40 bcm of gas over a period of 10 years, or about 4 bcm per year. These and other LNG imports will begin both to diversify Turkey’s natural gas supplies away from its risky Russian and Iranian imports and move it further along towards its goal of becoming a regional natural gas (supply) hub.
Rather than typing out the full story here, please listen to our interview with TRT*s Istanbul Straight Talk host. Also, below i have annexed some of my pre-interview research sources and notes.
Best, Tom O’D. Berlin 11Sep2024.
PS I’m looking forward to meeting GlobalBarrel.com followers: next month at either of
- The Warsaw Security Forum, 1-2 October, Warsaw, Poland
- INUPEC, The Africa & Mediterranean Energy & Hydrogen Exhibition and Conference, 14-16 October 2024, in Oran, Algeria. I’ll be moderating a few sessions.
PPS. Pre-Interview Research References & Notes
The Global Barrel 