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    Turkey Closes its Doors to Israeli Gas



Turkish Energy Minister Yildiz said that the pipeline project which will ship Israeli gas from Leviathan field is "out of question" under this circumstances.

by: Murat

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Natural Gas & LNG News, News By Country, , Israel, Turkey, Security of Supply, Top Stories, East Med Focus

Turkey Closes its Doors to Israeli Gas

Turkey's Minister of Energy and Natural Resources, Taner Yildiz, who has held this post since May 2009, has had a recurrent theme in all of his speeches: "The main priority for us is energy supply security, Turkey need to diversify its energy sources." As this 'motto' received support from all government and entrepreneurs, the projects in the investment horizon may need to be revised due to increasing geopolitical tensions in the Middle East.

The main reason for this contraction is Israel's military operations in Gaza. The Israeli military campaign in Gaza, which began July 8th, intensified and took the lives of more than 1,800 Palestinians, the increasing tensions across the region.

Long before the last Israeli operations, relations between Turkey and Israel were downgraded since a 2010 raid by the Israeli navy of the Mavi Marmara, a Turkish ship headed to the Gaza Strip with humanitarian aid. The attack took the lives of 10 Turkish activists. The Turkish government expelled the Israeli ambassador and demanded an apology and compensation for the victims.

With strong pressure from Washington on Israeli Prime Minister Binyamin Nethanyahu, Israel apologized formally to Turkey early this year. According to figures from the Turkish Economy Ministry, bilateral trade volume between Turkey and Israel rose to a record high of $5.1 billion in 2013, jumping 47% since 2010. Since then, Turkey and Israel have tried to fix the broken business ties, and worked on a compensation agreement.

In early February, Amit Mor, president of EcoEnergy, had said that the reconciliation between Israel and Turkey might lay the groundwork for the project to be realized. "Israel would be an important and competitive source for Turkey," said Mor, according to a Wall Street Journal report dated February 11, 2014.

But these efforts came to an end with Israel's extended Gaza operation.

Turkish Energy Minister Taner Yildiz said that the natural gas pipeline project which will ship Israeli gas from the Eastern Mediterranean is "out of the question" under these circumstances. "If we build a natural gas pipeline from Israel or the Eastern Mediterranean under these circumstances, the blood of innocent infants and mothers, not natural gas, would flow through it," Yildiz said in a televised presser after meeting with Maltese Energy Minister Konrad Mizzi.

"There is no possibility to carry out this project right now and this issue can only be discussed after an end to the cruelty in Gaza," he said. Yildiz said that the potential partnership with Israel could be talked after "everything has stabilized and calmed down."

In 2010, Israel discovered the giant Leviathan offshore gas field, which is expected to provide the country with greater energy independence. Israel has been working on several different alternatives in order to transport and commercialize its newly discovered gas reserves. Noble Energy operates the Leviathan with a 39.66% working interest; Israeli firms Delek Drilling and Avner Oil Exploration hold 22.67% stakes each and Ratio Oil Exploration holds the remaining 15%. Australian gas producer Woodside Petroleum scrapped an agreement to buy a quarter of Israel's largest natural gas field for as much as $2.6 billion after talks to complete the deal collapsed. 

A recent study from Israel's Institute for National Security Studies - an affiliate of Tel Aviv University - said that any natural gas project deal cannot be made without improving diplomatic relations. "An agreement that resolves the dispute between Israel and Turkey is a necessary condition for an agreement over exporting Israeli gas to Turkey. Commercial businesses trying to advance exports stand no chance of achieving their goals without a solution," the report stated.

At last, we’re back to square one, as Turkey Energy Minister Taner Yildiz will continue with his motto in coming days ahead:

“The main priority for us is energy supply security, Turkey need to diversify its energy sources.” 

Murat Tinas