Deals that have strengthened energy ties between
Turkey
and
Russia
may
boost
Ankara
’s
much desired control over regional gas and oil transit, but at a cost to other
foreign players in its downstream market.
Russian Prime Minister Vladimir Putin and his Turkish counterpart Recep
Tayyip Erdogan last year shook hands on agreements ranging from oil and natural
gas to nuclear energy technology in return for Erdogan’s support for a
Kremlin-backed gas pipeline.
Beyond securing the energy supplies needed to feed fast-paced economic
growth seen returning this year, the deals will help
Turkey
realize
its dream of capitalizing on its location between Caspian energy reserves and
European consumers.
Apart from
Turkey
’s
support for
Russia
’s
South Stream gas pipeline, which aims to feed European markets, the deals
centered on Russian backing for
Turkey
’s
Samsun-Ceyhan oil pipeline that would carry oil from
Black Sea
ports to the
Mediterranean
.
But
Turkey
’s
blessing of a select handful of Russian and Turkish firms to carry out planned
energy projects – and signs that
Turkey
may
commission
Russia
to build its first nuclear plant without a tender – have caused worries.
“Some companies close to the government are being awarded special
projects and given special partnerships – that’s how you hurt the market and
competition, this will hurt the liberalization of the market,” said energy
analyst Necdet Pamir.
Turkey
’s
fast-growing power generation and distribution sectors as well as its gas
market, tapped for liberalization, have attracted the attention of numerous
investors looking to build power stations and bid for projects.
Last year,
Austria
’s
OMV said it wanted European Union member candidate
Turkey
to
become its third strategic center after
Austria
and
Romania
.
But competition may become an issue if the government’s favor continues
to center on a handful of companies, including Calik Enerji, whose parent
company Calik Holding’s chief executive is the Prime Minister’s son-in-law.
“Concerns regarding competition could arise from greater Russian
presence in power generation as well as downstream power and gas markets. This
could discourage market entrants upstream and downstream,” said Irmak Bademli
of Eurasia Group.
Calik Holding has denied receiving preferential treatment from the
government. On Wednesday, the
US
ambassador met with Energy Minister Taner Yildiz to express the desire of US
firms to build
Turkey
’s
first nuclear power station. Government sources have said the licence for the
Turkish nuclear power station may simply be handed to
Moscow
, which already supplies 60
percent of
Turkey
’s
gas needs, if they can agree over pricing and other technical issues.
Such a move would add to worries over the possibility that NATO-member
Turkey
’s
policies are shifting away from
Ankara
’s
traditional Western friends. “
Turkey
’s
Western allies would not be happy if the nuclear plant is built without a
tender,” said Bademli.
Turkey
’s
desire to turn itself into a hub for European and other regional energy
supplies has long frustrated partners. The Turks have sought to dominate deals,
most notably with the Nabucco Pipeline consortium, to which
Turkey
belongs.
Nabucco plans to pump 31 billion cubic meters of gas to
Europe
to cut the continent’s reliance on
Russian gas.
Last year,
Turkey
demanded that it be given special rights to siphon gas off the 31-billion cubic
meter capacity pipeline and resell it. With other sell-offs looming, like power
production and distribution assets, analysts wonder to what lengths
Turkey
will go
in favoring its Russian partners and their Turkish counterparts.
“We’re concerned about the direction
Turkey
is
heading particularly on the gas side. Companies are looking to see if there is
a new policy direction, whether
Turkey
will
remain open to the market or if we could see more opaque policy,” said one
diplomatic source.
Turkish firm Aksa Dogalgaz is positioning itself to import 6 bcm over
Turkey
’s
western line that imports Russian gas. Aksa already has some 10 domestic gas
distribution grids. “We’re not only going to be 63 percent dependent on Russia
for gas imports, but Gazprom will also have a strong hand in the gas
distribution system through Aksa as well. This is a dangerous game for national
energy security,” said
Pamir
.
(
from
E-Kathimerini, 5/2/2010)