Turkey's Gas Imports Dip in October
Turkey's gas imports in October were 3.71bn m³, down 10.4% on October 2017, while demand was down 15.4%, according to data from Turkey's energy regulator EPDK.
The fall in imports is similar to the 10.85% fall reported in September but higher than the 9.49% recorded over the first three quarters of the year. The drop in demand was considerably higher than the 2.75% drop reported in September and the 7.33% recorded over the first three quarters of the year.
The figures confirm that Ankara has been continuing with its policy of reducing its trade and current account deficits.
Turkey's gas-fired power sector used 17.6% less gas year on year in October, compared with 7.48% less year on year in September. Its biggest combined-cycle gas turbine used 25.2% less gas year on year, and 15.8% less than in September.
The figures appear to confirm reports that the greatly increased prices being charged for gas for power by state gas importer Botas are succeeding in their aim of reducing gas burn. CCGT operators have complained that they are unable to operate at a profit and are hoping that colder winter weather will help them avoid possible bankruptcy.
The data also confirm that Turkey is continuing to increase greater volumes of gas from Azerbaijan despite overall imports and demand falling sharply. Botas bought 0.771bn m³ from Azerbaijan, up 48.94% on October 2017, compared with sharp falls in imports from its two other pipeline suppliers Russia and Iran; and sharp rises in imports from Turkey's two long-term LNG suppliers, Algeria and Nigeria.
Imports from Russia were reported as 1.647bn m³, down 31.4%, with imports from Iran down 18.7% at 0.588bn m³. LNG imports from Algeria were reported as 0.504bn m³, up 98%; and from Nigeria 0.197bn m³, up 84.4%.
The rise in Azerbaijan imports follows the commissioning in July of the first phase of the Tanap pipeline, which will eventually supply Turkey with 6bn m³/yr of Azeri gas in addition to the up to 6.6bn m³/yr it has been receiving since late 2006.
The fall in Iran volumes comes after pressure from Washington on Turkey to reduce oil and gas imports from Iran, and given the more recent rapprochement between the US and Turkey, may prove to be temporary. The sharp rise in LNG imports from Algeria and Nigeria may reflect the need to catch up with take-or-pay commitments: Botas holds long term fixed contracts for 4.4bn m³/yr and 1.3bn m³/yr respectively but it bought a lot of cheap Qatari LNG over the summer.
The sharp fall in Russian imports however is due almost entirely to the continuing problems faced by the seven private companies which import Russian gas via the western Transbalkan pipeline. Imports by the seven in October were down 41.8% year on year at 0.420bn m³, against a fall of only 3.7% in imports by Botas.
Only one company, Enerco, registered a rise in imports while one importer, Bosphorus Gaz, reported no imports at all for the second month running. Industry insiders have been telling NGW for some months that several of the private importers are facing serious problems meeting their take-or-pay commitments with Gazprom, having been undercut by Botas which was selling gas at below cost ahead of the Turkish general elections in June.
Sector officials claim that the prospect of possible bankruptcy of several of the importers and loss of income for Gazprom have prompted the Russian giant to press for the privately-held contracts to be transferred to Botas, which as the sole importer had to auction them off some years ago to create some competition.
They allege, although nobody has officially commented on either side, that Gazprom has "reactivated" its previously held majority stake in Bosphorus Gaz and is attempting to persuade the other private importers to transfer their contracts to Bosphorus, which would then reassign them to Botas along with any remaining take-or-pay commitments. The Transbalkan pipeline enters Turkey through Bulgaria and could form a part of Gazprom's longer-term strategy for European gas deliveries. Removing the private importers from the picture would simplify the work that will be done by Gazprom and Botas on the onshore section of the second TurkStream line, slated to come on stream by the end of this year.