Botas To Boost Algerian LNG Imports
Turkey's state gas importer Botas is to increase the contracted volume of LNG it imports from Algeria to 5.4bn m3/yr starting next year, from the current 4.4 bn m3/yr level.
Turkish state news agency Anatolia reported September 11 that Botas and Algerian state gas company Sonatrach had July 31 signed a revision to their 2014 contract, increasing the annual volume to 5.4bn m3/yr with effect from October 1 2019. The end-date of the contract remains October 1 2024, Anatolia said citing Sonatrach vice chairman Ahmed Mazigh.
A Turkish gas sector official told NGW that the revision had become necessary because, over the past two years, Botas had been importing more than the 4.4bn m3/yr in the existing contract. Increasing the volume specified in the contact should end the need for Botas to source additional Sonatrach cargoes on a spot basis, he added.
Botas began importing up to 4bn m3/yr of LNG from Algeria in 1994 under a 20 year contract signed in 1988. That contract was renewed in 2014 for a further ten years with the maximum volume increased to 4.4bn m3/yr; Turkish officials confirmed at the time that the reference price had changed from that of crude oil to the LNG spot market - although precise details were never released. Anatolia made no mention of any further change to the pricing.
Turkish gas demand continues to increase despite official efforts to reduce the volume of gas used to generate electricity, reaching 53.86bn m3 last year, up from 46.48bn m3 in 2016. With pipeline contracts until recently supplying close to maximum volumes, Turkey has increasingly relied on imports of LNG to meet demand.
Turkey has two onshore LNG import terminals, one operated by Botas and the other by private sector operator EgeGaz, plus two floating (FSRU) terminals commissioned in late 2016 and 2017, the first operated by a joint venture of Turkey's privately-owned Kolin and Kalyon groups, the second operated by Botas; Botas has announced plans for a third such FSRU terminal in Turkey.
Turkey's LNG imports last year totalled 10.765bn m3, up from 5.504bn m3 in 2016 - of which imports from Algeria were 4.617bn m3 (2016: 4.28bn m3). According to latest data published by Turkey's energy regulator EPDK, LNG imports over the first six months of this year totalled 6.241bn m3, up from 5.108bn m3 in 1H2017; of those Algerian volumes reported as 2.149bn m3 (1H2017: 2.552 bn m3).