Turkish firms eye consortium to transport Israeli gas to Europe

Special to WorldTribune.com

A group of Turkish firms plan to form a consortium that will ultimately deliver Israeli natural gas throughout Europe.

The 15 Turkish companies hope to help transport up to eight billion cubic meters (BCM) of Israeli gas per year. Turcas CEO Batu Aksoy said Turkey would be the gateway for deliveries of the gas throughout Europe.

Israeli gas drilling platform in the Tamar field. /Delek/Avner
Israeli gas drilling platform in the Tamar field. /Delek/Avner

Any deal between Israel and Turkey cannot proceed until the two countries sign a reconciliation agreement. Turkish President Recep Erdogan has prohibited gas imports from Israel since the Marmara incident in 2010.

“The main advantage of creating a consortium is that companies can share the risks in such a major deal,” Aksoy told Turkish daily Hurriyet.

Turkey consumes 50 BCM of gas annually and is looking to reduce its dependency on Russian gas, which supplies about 55-60 percent of the country’s needs, Aksoy said.

“The less dependent a country becomes on a sole provider, the lower gas costs it faces. Europe wants to decrease the share of Gazprom in its gas market by opening their gas market more and increasing their liquefied natural gas [LNG] sources… Turkey needs to do the same,” Aksoy said.

“Turkey has been connected to Russia, Iran and Azerbaijan by pipelines. There are two other sources to maximize the pipelined gas potential: The eastern Mediterranean and Iraq… The inflow of natural gas via six or more pipelines from five suppliers rather than four pipelines from three suppliers will enable Turkey to gain a much bigger bargaining position in gas price talks. We believe eastern Mediterranean gas will be a huge chance for Turkey on the road to becoming an energy hub.”

Like Turkey, Europe is seeking to diversify its sources as nearly 30 percent of the gas consumed by Europeans comes from Russia.

Other obstacles to the deal include Egypt, which would likely gain preferential treatment should it want to import Israeli gas; and Cyprus, which would have to approve any Israel-Turkey pipeline, which would have to pass through its territorial waters.

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