LONDON (ICIS)--The discovery of 320 billion cubic metres (bcm) of natural gas reserves in the Black Sea, announced by president Recep Tayyip Erdogan on 21 August, is likely to soften Turkey’s dependence on imports from 2023.
In a televised speech, Erdogan explained that Turkey’s Fatih drilling ship, which began drilling on 20 July, had discovered the reserves in the Tuna 1 natural gas field - also known as the Sakarya gas field.
Turkey’s natural gas consumption reached 44bcm last year, explained a source based in Turkey. “If Turkey’s annual consumption is 44-50bcm, then we could expect to see this discovery meet Turkey’s demand for six-to-seven years.”
Turkey aims to provide the country with natural gas from this field in 2023. Nevertheless, sources have told ICIS that it could take at least seven years to start production.
A Turkish trader stressed that the 320bcm volume is only the detected reserve, and that should Turkey discover more reserves then it would bear more significance for the country.
NATURAL GAS IMPORTS
The announcement is good news for Turkey – a country heavily reliant on imports to meets its energy demands. In 2019, the Turkish energy import bill stood at $41bn.
Turkey’s natural gas imports during the first five months of this year stood at 20.5bcm, down by 0.6% year on year, according to data from the country’s Energy Market Regulatory Authority (EPDK). In stark contrast, natural gas exports reached 171mcm during January-May 2020, down by 42% compared to last year.
In May 2020, Azerbaijan became the largest natural gas supplier to Turkey with 881mcm, accounting for 33% of the overall imports. This was followed by Qatar (520mcm) and Russia (340mcm).
Turkey’s natural gas imports from Russia fell by 62% in May this year compared to the same month last year.
Turkey will hope the new natural gas discovery will soften its reliance on imports and ease the country’s large and persistent current account deficit.
In his speech, president Erdogan also explained that the country will continue its hydrocarbon exploration activities in the Mediterranean.
Turkey is currently involved in a heated maritime dispute with Greece – supported by Cyprus, Egypt, Israel and France - over large natural gas reserves that have been found in the waters off Cyprus in recent years.
Last year, Turkey stepped up drilling to the west of Cyprus and put out a naval alert that it was sending its Oruc Reis research ship to carry out a drilling close to a Greek island.
The Turkish government also signed a maritime deal with Libya’s UN-recognised Government of National Accord in November 2019 to create an exclusive economic zone from Turkey’s southern coast to Libya’s northeast coast. The deal is deemed unlawful by Greece and Egypt.