Anastasia Gorbacheva18:46, 04/28/24

Ankara wants to create a “new supply portfolio” to eliminate dependence on a single source.

Turkey is in talks with US energy company ExxonMobil for a multi-billion dollar liquefied natural gas deal . Ankara is seeking to limit its dependence on Russian energy.

Turkish Energy Minister Alparslan Bayraktar, in an interview with the Financial Times , said that the negotiations are taking place against the backdrop of improving relations between Turkey and the United States after Ankara lifted its veto on Sweden’s entry into NATO and Washington allowed the sale of F-16 fighter jets to Turkey. In addition, Türkiye is seeking to position itself as a regional energy hub.

According to him, Ankara will receive up to 2.5 million tons of LNG per year as part of the agreement with Exxon. He said the commercial terms of the deal were still being discussed, but Argus estimates that the 2.5 million tonnes of LNG sent to Turkey would currently be worth about $1.1 billion.

The 2.5 million tonnes of LNG being discussed would be enough to cover about 7% of Turkey’s natural gas consumption last year, according to FT calculations. At that time, Türkiye imported 5 million tons of LNG from the United States on the spot market.

It is noted that Exxon has ambitious plans to expand its LNG portfolio to 40 million tons per year by 2030, which is approximately twice as much as in 2020.

Exxon said it has held initial discussions with the Turkish government regarding potential LNG opportunities.

Russia is by far Turkey’s largest supplier of natural gas, accounting for more than 40% of its consumption last year, mostly via pipelines. Ankara currently has long-term LNG supply agreements with Algeria and Oman.

Moscow is also Turkey’s largest oil supplier and will own and operate the country’s first nuclear power plant, currently under construction on the Mediterranean coast. According to Bayraktar, Russia, along with South Korea, has a “serious interest” in a similar nuclear project in the Black Sea.

“To ensure reliable supplies, we need to get gas from somewhere. It could be Russia, it could be Azerbaijan, it could be Iran or other options,” the Turkish energy minister noted.

Bayraktar added that Türkiye has made efforts to expand its LNG reception and storage infrastructure. About 30% of Turkey’s natural gas imports last year were LNG, up from 15% in 2014.

Turkey also has its own exploration and production activities, including a large gas facility in the Black Sea and oil drilling in the southeast of the country. According to Bayraktar, the country may also begin oil exploration in the Black Sea this year.

Sanctions against liquefied gas in Russia – latest news

Politico wrote that the European Commission is considering  introducing restrictions against Russian liquefied natural gas . Thus, this will be the first step that Brussels can decide to take in relation to the gas sector of Moscow. 

Diplomats note that new sanctions may concern three Russian projects in these gas sectors of the Russian Federation, as well as the re-export of Russian liquefied natural gas from EU ports.

(C)UNIAN 2024