Turkey Likely to Get $2 Bn from Iran For Charging Higher Gas Price

Turkey is expected to get more than $2 billion from a lawsuit against Iran for charging higher gas price, Energy and Natural Resources Minister Taner Yıldız said on Monday, reports Turkish newspaper Today’s Zaman.

“We came to the table [to meet] with Iran. We spoke in a friendly manner and told them that we will file a suit against Iran, and we are in fact doing so. We are 99 percent sure that we will receive our money [paid out due to high prices on natural gas]. It is more than $2 billion. I trust the decision of the arbitration board,” said the minister.

Senior Turkiesh officials including the Prime Minister Recep Tayyip Erdoğan were on a vist to Iran late last month where the gas price issue was discussed. 

Turkey currently pays $490 per 1,000 cubic meters of gas, much higher than $335 for gas purchased from Azerbaijan and $425 from Russia.

In 2012, Turkey applied to an international court of arbitration to help reduce the price of Iranian gas.

Much of the problem in the gas trade between Tehran and Ankara derives from a “take or pay” condition that requires Turkey to import predetermined amounts of natural gas -- 10 billion cubic meters per year -- according to a gas deal signed in August 1996 and valid for 25 years, says Today’s Zaman.

Sign-up for our free weekly newsletter update via email here