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Eurasianet

Eurasianet

EurasiaNet.org provides information and analysis about political, economic, environmental and social developments in the countries of Central Asia and the Caucasus, as well as in…

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Could Turkey Become The New Ukraine?

Could Turkey Become The New Ukraine?

The deepening crisis in Ukraine is boosting Turkey’s decade-long efforts to establish itself as the lynchpin in energy flows from eastern providers to European customers.

On February 8, Turkish Energy Minister Taner Y?ld?z and Gazprom Chief Executive Officer Alexei Miller surveyed possible routes for the so-called “Turkish Stream” gas pipeline, a multi-billion-dollar project that could funnel up to 63 billion cubic meters of natural gas under the Black Sea from Russia to Turkey, and on to Greece and the European Union.

The project, announced by Russian President Vladimir Putin during a December 2014 state visit to Turkey, shook the energy world. It would supersede the partially built Russia-to-Bulgaria “South Stream” pipeline.In mid-January, Moscow announced Turkish Stream would replace its existing pipelines crossing Ukraine to European markets.

Construction of the Turkish Stream’s first section should be completed by December 2016, according to Gazprom.

The pipeline’s cost and size leave lots of room for doubt about whether the project will ever be realized. Skeptics suggest it is a mere bargaining chip for Moscow in ongoing maneuvering with Brussels over Ukraine-related sanctions.

Diplomatic questions aside, the project “is starting to make much more sense,” said political consultant Atilla Ye?ilada of the Istanbul-office of Global Source Partners, an emerging-markets consultancy. “Russia announcing plans to cancel all Ukrainian pipelines means that half of Europe’s gas will go through Turkey. That makes it more feasible, as Turkey becomes the new Ukraine.”

Brussels has been cool to the prospect of Turkey displacing Ukraine as a transit point. EU energy tsar Maroš Šef?ovi? has warned Russia that it has long-term contractual obligations to supply its gas to Europe through Ukraine, and has called for more negotiations about South Stream.

Moscow’s reaction was to issue an ultimatum. “There are no other options [other than Turkish Stream],” asserted Gazprom’s Miller on January 14.

Turkey, a member of NATO, has long been aligned with the United States and European Union when it comes to Black Sea economics and geopolitics. Turkish Stream, however, could nudge Ankara toward the middle ground between the West and Russia.

As Turkey’s prospects of becoming a regionals energy transit hub improve, some Turkish officials sense that Russia is negotiating from a position of weakness. Thus, they are driving a hard bargain. “Turkey is sensitive about negotiations on the price of natural gas as much as it is about the realization of the Turkish Stream pipeline,” noted Energy Minister Y?ld?z on February 8.

Some Turkish energy experts argue that Turkey should not become overly focused on the gas price. “Turkey needs to negotiate wisely with Russia,” said Volkan Özdemir, chairman of the Institute for Energy Markets and Policies, an Ankara-based think tank.

“I think Turkey has [the] upper hand with Russia in gas relations, with Moscow facing all these sanctions and economic turmoil over Ukraine,” Özdemir continued. “Turkey has to use its negotiation power and offer Russia to be a partner, so that Turkey has the right to trade gas, rather than be just a carrier of gas.”

Ankara’s apparent hard line in negotiations may have already paid dividends.

The agreement that Putin proposed in December would allow “for the first time Russia-originated gas to be supplied to Europe under commercial terms negotiated by Turkey,” pointed out Sinan Ülgen, a Turkish foreign-policy expert at the Carnegie Institute in Brussels. “On this basis, it allows Turkey to reach out to other suppliers [of gas using Turkey as a transit corridor] and ask similar terms.”

Turkish Stream is just one of several energy transit projects that Ankara has in the works. The South Caucasus state of Azerbaijan is planning the 2,000-kilometer, partly Turkish-owned Trans-Anatolian Pipeline (TANAP) pipeline to carry Azerbaijani gas across Turkey to Europe. Other gas pipelines are under consideration from Iraqi Kurdistan and Iran, respectively.

Ankara also is aggressively pursuing relations with gas-rich Turkmenistan. Turkish Foreign Minister Mevlüt Çavu?o?lu visited Ashgabat in January, laying the groundwork for a provisionally planned state visit to Turkey in October by Turkmen President Gurbanguly Berdymukhamedov.

A senior Turkish official privy to developments quipped that “we used to be ‘one language, two nations’ with Azerbaijan. Now, we are saying ‘one language, three nations.’”

There is a catch to getting Turkmenistan involved in trans-Caspian gas exports, cautioned energy expert Özdemir – probable resistance from Russia. The inability of the Caspian’s five littoral states – Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan – to agree on a comprehensive pact covering the sea leaves room for Kremlin meddling. In late December, EU representatives suggested that such a pipeline would depend on Turkmenistan and Azerbaijan alone. But Moscow is unlikely to agree with that analysis.

“The Turkmen need to get the consent of Russia for a pipeline under the Caspian Sea to connect with the TANAP pipeline running to Turkey,” Özdemir said. “That will be impossible because Russia does not want competition [for the] European market.”

By. Dorian Jones

Originally published on Eurasianet




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