Almost all the developments surrounding Turkey in the last months
such as the Ukraine-Russia-EU crisis, the Israel-Turkey normalization
process, Joe Biden’s visit to Cyprus, andthe biggest mining accident in
the history of Turkey remind us of one thing: energy.
Between the
producers in the Caspian Basin, Central Asia, the Middle East and the
European and international energy markets, Turkey’s energy politics and
diplomacy over energy affect a very wide range of countries from
different angles.
The Middle East angle
By lowering the
costs of desalination and increasing the supply of fresh water, the
newly found natural gas reserves of the Mediterranean coasts can
contribute greatly to the elimination of water conflicts in the region.
The new natural gas volumes have already increased water supply in the
region.
The Middle East is also one of the few regions where
electricity is still largely produced from oil; consequently power
generation is expensive and highly polluting and electricity supply is
unreliable. Stable supplies of natural gas could strengthen economies in
the region by providing cheaper, cleaner power and augmenting water
production for agriculture.
Reliable supplies of electricity at
affordable prices can prove a critical factor to the economic and
political stability of states in the region. Let’s remember frequent
electricity blackouts contributed to public anger with both President
Hosni Mubarak and President Mohammad Mursi and played a role in their
respective downfalls.
What happens in Iraq does not stay In Iraq
The
ties between Ankara and the Kurdistan Regional Government (KRG) in
Erbil, Iraq, have been given a boost by several energy deals but it also
sparked international reactions, as the central government in Baghdad
expressed discomfort about the exports. Iraqi Kurdistan began selling
its oil independently of the federal government in 2012 through Turkey
by truck.
A Turkish company called Powertrans has acted as broker for the
Kurdish government, selling the oil via tenders to traders such as Italy
and Germany. After Baghdad opposed the action, claiming that Kurdish
economic independence could threaten Iraq's unity, Turkey decided to
wait for Baghdad and Erbil to resolve their differences. After five
months of talks and little progress, tanks at Ceyhan are now full of
Kurdish oil, and Turkey decided there was no point in further
obstructing exports.
As of this Thursday, the first 1 million
barrel cargo was loaded at Ceyhan pipeline of Turkey, which is likely to
annoy Baghdad. Baghdad has cut the region's share of the budget to
punish it for building the new pipeline, and oil sales can provide the
Kurdistan Regional Government with desperately needed income. While
Germany and Italy are keen to be the first buyers of Iraqi oil, raising
concerns about the implications of Turkey’s direct dealings with the KRG
for Iraq’s territorial integrity, the U.S. has made apparent its
uneasiness with Turkey’s involvement and deemed the exports of Iraqi oil
be declared illegal.
Turkey’s Minister of Energy Taner Yildiz,
however, insisted that Turkey would stand behind the existing
arrangement since the U.S. did not interfere with its own businessmen
reaching deals with Erbil without the consent of Baghdad. Surely,
Turkey’s main objective in this matter is not limited to being an energy
expert but to have an upper hand in the Kurdish region concerning a PKK
connection.
Israel and Turkey ties
Energy resources can
start wars and they can help foster peace. The latest gas discovery by
Israel in the Leviathan field in the Mediterranean Sea will not only be
warming the houses of Israeli citizens, but also the relations of Israel
with Turkey.
For Israel to become an energy exporter, both
Cyprus and Turkey need to get connected through pipelines to transport
Israeli gas to Europe, from underneath the sea through land via Turkey
and through shipping in tankers with the help of a condensation factory
to be built in Cyprus.
These are the reasons, which brought Joe
Biden to Cyprus this week to help reconciliation between the sides and
these are the reasons why Turkey and Israel are in a rush to fully
normalize relations.
Israel is not in a position to decline a
20-year contract offer made by the Turkish energy company Turcas Petrol
for seven billion cubic meters of gas annually. On the other hand, If
Israel is seriously considering selling its gas; she has to endure
Turkey’s demands in the normalization process since trying to liquefy
and ship the gas would present serious – and expensive - security risks.
Turkey
on the other hand, needs to adopt a more reconciliatory tone. The
Israeli Navy is not as strong as its air forces and according to
Lieutenant Ilan Lavi, Israel needs to invest at least $700 million
dollars into its navy to secure the shipping of Israeli gas if an
agreement with Turkey’s pipelines cannot be reached.
The European Union and the Russia angle
In
one of my previous articles I wrote that sanctions to Russia – if
applied – would only further damage European economies and Russia could
end up exporting its rich natural resources to the rapidly-rising East.
Only a few weeks after this, Russia and China signed a 30-year, $400
billion deal for Gazprom to deliver Russian gas to China, providing 38
billion cubic meters of gas annually. Being the largest gas agreement in
the history of Russia the Putin Land once again tore the European
sanction card apart.
The crisis-stricken EU, if an alternative
gas supply is not provided in three years time, will have to pay more
for the natural gas starting in 2018. While this is considered as a step
to a neo-Cold War, there is one development on Turkish soil which can
relieve the stress of the EU states; the Southern Gas Corridor project.
Turkey
will play a key role in energy route structuring with the Southern Gas
Corridor project, which will supply Europe with gas from Azerbaijan, and
will also have the capacity to carry extra gas from northern Iraq,
Turkmenistan and possibly Iran. The project will reduce Europe’s
dependency on Russian energy while increasing its dependence on Turkish
pipelines. The SGC will be going through Turkey like a superhighway,
primarily carrying the riches of the Caspian Sea for energy dependent
Europe.
Because of the strategic liability of being dependent on
foreign natural resources, Turkey looks to increase safety regulations
on its 700 coalmines but not shut down the operations despite the heavy
loss we witnessed last week. Turkey needs new partnerships and improve
the functioning of its energy market to increase its standing in energy
geopolitics and feed its thriving new industries. While the West
mishandled their democratic intervention in Ukraine, taking solid steps
in being an indispensible energy hub and increase its clout in the
international system seem to be exactly what Turkey has been doing
lately.