THE supply chain crisis fired with the pandemic and lingered with the war in Ukraine adversely impacted the global economy, particularly in the energy area. The Southern Gas Corridor is critical for the European Union (EU) in its search for short and medium-term alternatives for resolving the energy crisis. The Southern Gas Corridor aims to transmit the Caspian Sea’s natural gas sources to the European markets, thus reinforcing Europe’s energy supply security.

TANAP AND TAP PIPELINES
On that note, Türkiye is located at a strategic point for the TANAP (Trans Anatolia Natural Gas Pipeline) and TAP (Trans Adriatic Pipeline) that transmit Azerbaijani natural gas to Europe. The Memorandum of Understanding on a Strategic Partnership in the Field of Energy was signed in July 2022 between Azerbaijan and the EU, represented by the European Commission. The agreement further strengthened Türkiye’s strategic importance. Azerbaijan has been performing activities to increase the natural gas exports via the TANAP pipeline from 16bcm to 32bcm and via the TAP from 10bcm to 20bcm. Moreover, the country plans to double its natural gas exports to Europe by 2027.

TÜRKİYE IS A PROJECT PARTNER
An academic from Kocaeli University/Energy Expert, Dr. Yunus Furuncu commented on the topic for the Istanbul Chamber of Commerce. Furuncu noted that Türkiye owned 30% of TANAP projects’ shares and, at the same time, 20% of the natural gas production site - the Shah Sea 2 Site. Furuncu said: “Türkiye joined the TANAP project as a critical player in the global energy market. Türkiye became a significant actor that supplies natural gas to the European Union. Europe’s energy crisis with Russia has constantly been boosting the importance of this pipeline. Therefore, increasing this pipeline’s capacity to 32bcm and transmitting 20bcm of this amount to Europe is being discussed. Türkiye is a key country in this respect. An agreement between Türkiye and Azerbaijan over TANAP can increase the natural gas transport to Europe.”

ACHIEVABLE THROUGH COOPERATION
Dr. Furuncu pointed out that the Southern Gas Corridor hosting the TANAP can gain more importance and added: “The capacity can be increased to 100bcm by connecting the route from Azerbaijan with Turkmenistan’s natural gas.

Such a capacity increase requires cooperation between the EU, Türkiye, Turkmenistan and Azerbaijan. This pipeline’s transformation into an essential alternative to Russian natural gas is critical for both Türkiye and Europe. Therefore, the EU and Türkiye’s increased efforts will be fruitful.”

Türkiye’s steps towards becoming an energy hub

Türkiye’s energy vision is to become a hub, a business centre in energy rather than a corridor or a transit country. Thus, the initiative to build the Natural Gas Futures Market to carry out natural gas trade in global standards as part of Energy Markets Operation Inc. (EPİAŞ) has been taken to become a hub within the scope of the Türkiye’s rights in the agreement on TANAP. Meanwhile, the attempts to transfer Turkmenistan’s natural gas to the TANAP pipeline via Türkiye-Azerbaijan-Turkmenistan cooperation continue. The cease of the conflict between Azerbaijan and Turkmenistan over the ownership of the hydrocarbon site at the border between the two countries in the Caspian Sea in 2021, and the signing of an agreement to jointly conduct research and development activities over the hydrocarbon site gained momentum to the activities performed in this field. On the other hand, cooperation between Türkiye and Azerbaijan with Uzbekistan, a member of the Organisation of Turkic States and a country ranking 14th in global natural gas production, is on the agenda.

Caspian Sea’s status problem has been resolved

Yunus Furuncu stressed that the finalization of the Caspian Sea’s status showed that transporting Turkmenistan’s natural gas to Europe from Türkiye (via Azerbaijan and Georgia) would be smoother and added: “Türkiye and Turkmenistan signed an agreement for natural gas procurement in 1999. However, the issue of the status of the Caspian Sea and the other regional developments forestalled an agreement. Turkmenistan’s natural gas capacity ranks fifth in the world, and the country is known for not fully realizing its potential in this area. The efforts of the European Union and Türkiye and their cooperation can enable the establishment of a new pipeline from Turkmenistan.”

Iraq’s natural gas can be included in the capacity

Iraq is another country with the potential to become a natural gas supplier in the short run. With a proven natural gas reserve of nearly 3.5 trillion m³, Iraq ranks 12th in the world. On the other hand, Iraq’s natural gas production is at 30bcm, but 20bcm of this amount is wasted due to the lack of investments in natural gas drilling with oil.

Iraq can be a significant natural gas exporter if this problem is covered. Dr. Yunus Furuncu underlined that the fluctuating political nature of Iraq also forestalled Iraq’s energy sources’ sufficient flow to global markets and added: “The political conflicts arising in Iraq are the greatest obstacle over the supply of this country’s natural gas to world markets and the investments to be made in Iraq. Iraq’s natural gas potential is quite significant. If this potential is used in cooperation where Türkiye takes part, the transfer of Iraqi natural gas to Europe would cost less and be completed faster than the other projects on the agenda.”