TurkStream: Turkeys role as gas transit hub

With the TurkStream pipeline under construction Turkey is about to gain a pivotal role in the gas import of the EU.

TurkStream's pathway begins in russian Anapa on the Black Sea coast to the thrace part of Turkey and then moving through Bulgaria, Serbia, Hungary to the Baumgarten gas hub in Austria.

This pipeline will yet again raise the import of natural gas from russian sources  - under circumvention of countries like Ukraine -  while it increases the dependency of Turkey from russian imports as well.

German newspaper "Welt" writes:

"Half of the total capacity of the pipeline, 15.75 million cubic meters per year, is destined for transit to Europe. 

In the medium term, the pipeline is to bring Russian gas to Austria via Bulgaria, Serbia and Hungary, to the largest European natural gas hub in Baumgarten on the Slovakian border. The new pipeline from the Turkish territory through Bulgaria and Serbia has already been completed. 

Contrary to the EU goal of diversifying gas imports and increasing energy security - for example by promoting liquefied petroleum gas imports and the requirements for decoupling production and pipeline ownership - the countries of Southeast Europe are even further expanding their dependence on Russia with TurkStream. 

Putin lures the countries with transit fees and flatters their regional ambitions. For example, in the case of Bulgaria, which wants to establish itself as an important natural gas hub for the Balkans, but has so far only imported Russian gas. 

At the same time, TurkStream is a competition project for the EU-partially financed Southern Gas Corridor, which is to bring ten billion cubic meters of gas annually to the EU via the Transanatolian Pipeline (TANAP) from Azerbaijani offshore fields in the Caspian Sea. 

While Bulgaria's dream of the "Balkan Gas Hub" can still fail due to EU regulations, Turkey has established itself with TurkStream as an energy hub - this has long been Erdogan's plan. 

"Turkey is striving to become an energy hub where buyers and sellers meet and where prices are set," said the Turkish energy minister Fatih Dönmez in November 2018. 

For this, Erdogan even appears to be ready to increase its own energy dependency on Russia. Turkey has virtually no gas reserves of its own and is dependent on imports. Therefore, just like Europe, the country had tried in the past to diversify its own energy supply and to make itself less dependent on Russia."

New conflict over gas transit between Russia and Ukraine ahead

Interesting article by Steven Pifer for Brookings:

"Twice in the past 14 years, a dispute between Ukraine and Russia has led Russia to cut off natural gas flows to Ukraine and Europe. The stage is being set for another cut-off in January. The European Union wants to ensure that gas continues to flow, so EU officials will attempt at a mid-September meeting to broker an agreement. But they face a difficult slog.

Gazprom, a large Russian parastatal, now transits a significant amount of gas to European destinations via Ukrainian pipelines. The volume totaled 87 billion cubic meters (bcm) in 2018, one-third of Russian gas exports to Europe.

However, the contract that governs this gas transit expires at the end of 2019. Kyiv wants to replace the current agreement with another long-term contract, preferably for 10 years. Moscow, on the other hand, wants just one year.

Russia hopes to bring Nord Stream 2—which runs from Russia to Germany under the Baltic Sea—online in 2020. (The U.S. government has raised the possibility of sanctions against companies involved with Nord Stream 2, but the pipeline is already 75% complete.) Moscow also hopes that Turk Stream—two pipelines running under the Black Sea from Russia to Turkey—will reach full capacity next year. Nord Stream 2 will have a capacity of 55 bcm of gas per year. Turk Stream consists of two pipelines, each with an annual capacity of 15.75 bcm. The Turks plan to use half of the gas domestically and export the rest to southeastern Europe. If Gazprom can move an additional 70.75 BCM of gas to Europe via Nord Stream 2 and the Turk Stream pipelines after 2020, its need for the Ukrainian pipelines will drastically decline."

You can read the rest of the piece via the below link:

https://www.brookings.edu/blog/order-from-chaos/2019/08/30/heading-for-another-ukraine-russia-gas-fight/