Turkey discovers more Black Sea natural gas

3 mins read

By Charles Ellinas

Turkey’s President Erdogan announced the discovery of a large natural gas deposit at the prolific Sakarya gasfield in the Black Sea.

Another 135 billion cubic metres (bcm) gas was discovered by Turkish petroleum company’s (TPAO) Fatih drilling ship at the Amasra-1 offshore well at a drilling depth close to 4000m.

This is on top of the 405 bcm discovery announced last year at the Tuna-1 well, bringing the total to 540 bcm – making these the biggest ever discoveries in the Black Sea.

Erdogan said drilling by the Fatih and Kanuni drilling ships is continuing, and he expects more good news from the region.

Sakarya is about 155 km offshore from the Filyos port city in Zonguldak Province, where the gas will eventually land by subsea pipeline and the gas processing facility will be located.

The exact quantities still need to be verified through additional appraisal, drilling and independent audit.

But this has not stopped engineering studies from progressing.

TPAO is planning to develop the discoveries independently, with the first gas expected to land by 2023.

Even though this is a very ambitious deadline, TPAO is determined to achieve it – 2023 is an important year for Turkey as it celebrates 100 years since becoming a republic.

Initial gas flow is expected to be around 5 bcm/yr, rising to plateau production of about 15 bcm/yr by 2027-2028, about 30% of Turkey’s current gas consumption.

Last year’s natural gas consumption in Turkey was 48.2 bcm – with about 99% imported, at an estimated annual cost of $12 bln.

This discovery should lessen the country’s dependence on gas imports – mostly from Russia, Iran, and Azerbaijan.

But there is also an expectation the discoveries could boost gas consumption to 80 bcm by 2030, replacing coal and lignite currently used in power generation.

This would contribute to Turkey’s plans to reduce carbon emissions.

Undoubtedly, Turkey will also use the new discoveries to strengthen its bargaining position as it enters negotiations to renew a number of its existing gas purchase contracts, particularly with Russia.

These should help the country achieve better prices and more flexible terms. They also provide a boost to its energy security.

Energy independence

Over the last few years – since the downing of the Russian fighter jet in 2015 – Turkey has made energy security and independence a key target.

It has included ramping up exploration for oil and gas, which is bearing fruit.

Last week, Turkey’s energy minister, Fatih Donmez, also announced the discovery of oil at three onshore wells – two at the southeastern Diyarbakır province and a third at the northwestern province of Kırklareli.

These are expected to produce about 6,800 barrels per day (bpd), increasing the country’s daily oil production to 61,000 bpd.

In a report earlier this year on Turkey’s Energy Policy, the International Energy Agency (IEA) said rapid economic and population growth in the past two decades had driven strong growth in energy demand and an increase in import dependency.

As part of its efforts to boost energy security, Turkey has achieved considerable diversification of its energy mix over the last 10 years, particularly through the growth of domestic resources such as renewables, hydro and coal/lignite in electricity generation.

Including the planned commissioning of Turkey’s first nuclear power facility at Akkuyu in 2023, with a 4.8 GW capacity, that will further diversify the country’s fuel mix.

The effort includes diversification of natural gas supplies through three floating storage regasification units (FSRUs), supported by expanded gas storage facilities.

These have enabled the country to increase its LNG imports from Nigeria, Algeria, Qatar, and the US, thus adding to the security of gas supplies.

According to the IEA, where Turkey has achieved impressive growth is in the use of renewables.

Renewable electricity generation has nearly tripled in the last decade, with its share in total power generation reaching 44% in 2019 and still increasing.

Turkey discovers 320 billion cubic meters of gas in the Black Sea (TRTWorld)

Maritime disputes

The new oil and gas discoveries and developments in Turkey’s energy sector have not stopped the country from pursuing aggressive maritime policies towards its neighbours, ostensibly under the pretext of offshore energy exploration – particularly directed against Cyprus and Greece.

This year, these have been largely suspended following the EU’s warning in December that it is ready to apply sanctions and US policy change towards Turkey following Joe Biden’s election.

But plans by Turkey to purchase a fourth drilling ship and recent announcements by Donmez maintain the threat of intervention in disputed areas in the East Med.

TPAO entered into a preliminary agreement with a Norwegian company earlier to acquire a fourth deep-water drilling rig.

In May, Donmez – in what appears to be a veiled threat should negotiations with Greece fail – said Turkey could expand drilling activities in the Med and the Black Sea without being specific.

He said Turkey has already drilled eight wells in the East Med, but there was no economically significant discovery so far.

“Our experts are checking data after each drill with the seismic data obtained previously. We can have several more drills close to the ones where we see signs of gas.”

Perhaps for domestic consumption, Erdogan added that the “Yavuz drilling rig would soon start drilling in the Mediterranean,” without giving details.

But hopefully, it will not come to that.

Not only is the EU determined to maintain pressure on Turkey to refrain from future aggression, but the US is also adding its influence to bear.

Secretary of State Antony Blinken said recently that US diplomacy would be fully engaged in the region, including the Cyprus issue and supporting positive engagements to resolve disputes in the East Med.

Dr Charles Ellinas is Senior Fellow at the Global Energy Center, Atlantic Council Twitter: @CharlesEllinas