Turkey’s BOTAS issues curtailment order as gas demand soars to new record, Iran cuts supplies

Aura Sabadus

20-Jan-2022

LONDON (ICIS)–The Turkish gas incumbent BOTAS ordered gas-fired power plants to reduce consumption by 40% as demand reached a new record and pipeline supplies from Iran were cut.

Gas demand soared to a an all-time high of 288mcm/day on Wednesday, exactly a year after the market recorded the highest previous level of 269mcm/day.

To cope with the spike in demand which is driven by below-average temperatures, the incumbent BOTAS notified gas-fired power plants it would supply only 60% of their contracted volumes for January for a period of 10 days.

The curtailment coincides with a supply cut in Iranian gas as the Middle Eastern country is also facing a cold snap. The country has historically struggled to supply both its high consumption northern Tehran region and Turkey during periods of peak winter demand.

A market source said the incumbent BOTAS was off-taking maximum volumes on the Russian TurkStream1 and Blue Stream pipeline. This could be as much as 44mcm/day on Blue Stream and 16mcm/day on TurkStream1. The information cannot be confirmed as it is not available officially.

Independent importers Akfel Gaz, Bosphorus Gaz and Kibar Enerji were also thought to be importing on average 17mcm/day, their maximum daily contract quantity.

The electricity day-ahead baseload price rose to TL1,218/MWh only the second highest ever value recorded on the exchange EPIAS. The record of TL1224.00/MWh happened on 6 January 2022.

The trader said temperatures were expected to remain well below average for at least another week, with the high consumption area of Istanbul likely to experience an extensive cold snap.

He said if demand continued to rise, BOTAS and the electricity transmission system operator TEIAS would have to issue curtailment orders to power plants as well.

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