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Turkey’s natural gas sector to grow in 2017

Ersin Çelik
17:12 - 5/02/2017 Sunday
Update: 17:13 - 5/02/2017 Sunday
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Compared with European countries, Turkey is one those where natural gas consumption continues to show strong growth
Compared with European countries, Turkey is one those where natural gas consumption continues to show strong growth

Turkey has a strategic role in natural gas transit because of its position between the world's second-largest natural gas markets, the U.S. Energy Information Administration (EIA) said on Thursday.



The country located between Asia and Europe is strategically placed for the transfer of natural gas reserves of the Caspian Basin and the Middle East to markets in continental Europe.



In its country analysis published early February, the U.S. administration stated that as of Jan. 1, 2016, the Oil and Gas Journal estimates Turkish natural gas reserves at 177 billion cubic feet (Bcf). Turkey produces only a small amount of natural gas, with total production in 2015 amounting to 14 Bcf.



The analysis underlined that the country is an important consumer of natural gas as well as having potential to become an important natural gas transit country.



Compared with European countries, Turkey is one those where natural gas consumption continues to show strong growth.



This situation has helped the country develop multiple pipelines to both import and export natural gas.



Consumption, imports, and exports


The report underlined that the country is increasingly dependent on natural gas imports because its domestic consumption, especially in the electric power sector has recently experienced significant growth.



“Natural gas consumption in Turkey has increased rapidly over the past decade, reaching a new high of 1.7 trillion cubic feet (Tcf) in 2014 compared to 1.7 Tcf in 2015, and declining less than 0.1 Tcf from 2014,” the report showed.



Natural gas is mainly used in power generation, which accounted for almost half of total natural gas consumption in 2014. Most of the remaining consumption is roughly evenly split between the buildings sector (residential and commercial) and the industrial sector. Consumption growth is expected to remain strong as industrial sector growth and rising electricity consumption continue to spur demand.



Gazprom leading as Turkey's gas supplier


Through LNG and multiple pipeline connections, Turkey has a reasonably diversified supply mix.



In 2015, Turkey imported 1.7 Tcf of natural gas, accounting for 99 percent of total natural gas supply.



“However, Russia's Gazprom is by far the largest single supplier; accounting for 56 percent of Turkey's total natural gas supply in 2015. Turkey is Russia's second largest export market for natural gas after Germany. In 2015, BOTAŞ (Turkey's state-owned crude oil and natural gas pipelines and trading company) exported just 22 Bcf of natural gas,” according to the report



Turkey needs more natural gas infrastructure


“Because of rapid demand growth, Turkey's annual natural gas consumption is approaching the annual capacity limits of the country's import infrastructure (pipeline and LNG),” the analysis underlined.



Companies importing natural gas into Turkey are required to hold rights to storage capacity equal to 10 percent of their annual imports.



However, Turkey currently has just one operating underground storage facility with total storage capacity of about 5 percent of Turkey's imports of natural gas.



For comparison, the 28 countries of the European Union collectively have storage capacity equal to about 20 percent of total annual consumption. If all of the storage capacity currently proposed in Turkey is realized, capacity will amount to about 20 percent of current annual imports for domestic consumption, the analysis shows.



#Turkey
#natural gas
7 years ago