Many countries, led by Turkey, are seeking to secure their natural gas needs by concluding agreements and contracts with producing countries, after gas prices in the spot market witnessed record increases during the recent period.
In this context, the Turkish Minister of Energy and Natural Resources, Fatih Donmez, announced the conclusion of a deal with Azerbaijan to import an additional 11 billion cubic meters of natural gas.
Record demand for natural gas in Turkey this year has forced it to increase purchases in the soaring spot market, as it seeks to renew long-term contracts .
Gas Demand
Donmez stressed, in a statement on Friday, the government’s keenness to meet any possible increase in gas demand , noting that the talks that Turkey is conducting (with the countries it imports from) are going positively, Anadolu Agency reported.
He explained that officials of the countries from which Ankara imports gas pledged to increase the amount pumped to Turkey.
He pointed out that Turkey, thanks to its successful energy diplomacy, will pass the stage without problems, while the world is facing a serious crisis regarding natural gas supplies.
Azerbaijan Deal
The Turkish Energy Minister drew attention to the deal concluded with Azerbaijan to import an additional 11 billion cubic meters of natural gas until the end of 2024, via the Baku (Azerbaijan)-Tbilisi (Georgia)-Erzurum (Turkey) pipeline.
For his part, Azerbaijani Energy Minister Parviz Shahbazov said that Azerbaijan has signed a new agreement with Turkey to supply gas from the giant offshore Shah Deniz 1 field, Reuters reported.
Azerbaijan suspended gas supplies from Shah Deniz 1 to Turkey in April after the contract expired.
Gas Imports
Turkey, one of Europe’s largest gas importers, relies on gas pipelines from Russia and Iran, as well as from Azerbaijan, and liquefied natural gas imports from Nigeria and Algeria and spot markets.
Turkey had 4 long-term import contracts that expire this year, totaling 16 billion cubic meters annually.
This year’s drought has reduced hydropower and restarted idle gas power plants, pushing Turkey’s gas consumption to a record 60 billion cubic meters, with prices in Europe rising.
With the peak daily consumption expected to reach 300 million cubic meters this winter, Turkey will have to renew all contracts expected to expire in the coming period with at least the same volumes, and mobilize its supplies of expensive liquefied natural gas.
Source: XglobalMarkets
