On August 20, Turkish leader Recep Tayyip Erdogan delivered a bombshell on major reserves of natural gas discovered in the Black Sea. This came in a report by the NTV channel.
Erdogan said the finding resulted from a month-long exploration by the Fatih ship. The point at issue is the Tuna-1 subsurface area located next to the boundary intersection of the Bulgarian and Romanian waters with those of Turkey. Natural gas from this field might be used in 2023, the Turkish President noted.
The discovery is of historical significance to our country, Erdogan said, pointing to its being a key element of Turkey's economic development. And he promised to move along with detailed Black Sea field appraisal and start looking for gas in the Mediterranean.
Turkey's offshore program aims to reduce the country's dependence on carbon imports. Built in 2011, the Fatih ("Conqueror") vessel was originally named DeepSea Metro II. Under the new name and the Turkish flag, the 230-meter long and 36-meter wide ship was commissioned in May 2018.
It was in 2010 that the country launched oil and gas exploration in the Black Sea. The five sites were explored jointly with a number of global companies: Chevron, BP, Exxon Mobil, Petrobras. However, 2011 yielded no progress and no discoveries. In 2017, Turkey resumed work in the Black Sea, but without attracting foreign partners. Tuna-1 has become the first success announced by the authorities.
However, an independent audit is required to confirm the discovery of a field with large gas reserves, which needs time and money. As a result, the reserves may prove much more modest than the Turkish side touts.
Moreover, it is not entirely correct to reason that 320 billion cubic meters of gas solve Turkey's strategic task of avoiding energy dependence, if we compare the figure with the country's annual consumption of this energy vector. In 2019, over 45 billion cubic meters were imported. Gas is not produced domestically. The declared new resources at Tuna-1 given the current level of Turkey's gas consumption will be conceivably enough for about 7 years, provided the completely abandoned import and the field's annual output accounting to an unprecedented 45 billion cubic meters.
But as a channel for diversifying the state's supply of its own gas, the new field does have a potential. And it will not necessarily be put into commercial operation by 2023, as Erdogan expects. Besides, the deposit is a really deep one, with Turkish Energy Minister Fatih Dönmez saying it will still require drilling about 1.5 km deep into the sea floor. Therefore, it is too early to speak of a balanced assessment of the project's economics. After that, major investment will be required, as well as a plan to integrate the new gas into Turkey's national energy strategy based on the import of hydrocarbons. The country's stake has long been placed on developing the capacities of such gas pipeline systems as Turkish Stream (the official opening ceremony was held on January 8, 2020) and TANAP (the Trans-Anatolian Natural Gas Pipeline through which Azerbaijani gas has been transported from the Shah Deniz field since June 2018). Also, the current low market gas prices has made Turkey recently increase supplies of liquefied natural gas (LNG).
Last year, Turkey ranked fourth among the five countries to obtain most of Russia's natural gas. The republic purchased 15.1 billion cubic meters. The traditional leader is Germany with its 54.7 billion cubic meters of imported Russian gas, then we have Belarus (20.3 billion), Austria (16.7 billion) and Italy (14.3 billion).
In 2019, a significant increase in Russian LNG exports was recorded. The total delivery scope amounted to 28.9 million tons in physical terms – a 76 percent increase as compared to 2018. But the volume of LNG exports from Russia to Turkey amounted to some 7.5 million tons, which is about 20 percent less than in 2018.
Along with stable exports and consumption of traditional energy sources, Turkey shows high-performance activity in developing the potential of renewable energy sources (RES). Over the last 10 years, the country has tripled the design capacity of renewables and made eleven-figure dollar investments in these projects. The Turkish authorities plan to increase the total capacity of renewable sources to 63 GW by 2024. But this does not entail a profound revision of national gas supply plans – imports of pipeline gas and LNG will maintain a high level, given that many expert institutions envisage progress in the long-term outlook for the Turkish economy.