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    Turkey Cuts Imports 9% in 2018


Gas-fired power-plant operators are squeezed hard.

by: David O'Byrne

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Turkey Cuts Imports 9% in 2018

Turkish gas imports in 2018 totalled 50.36bn m³, down 8.85% on the 55.25bn m³ imported in 2017, despite rising in December, Turkish energy regulator EPDK said February 28. December imports were reported as 6.05bn m³, up 0.95% on the 6.0bn m³ imported in December 2017.

Turkey's gas demand also fell sharply, down 8.82% from 53.32bn m³ to 48.91bn m³, with December rising by 3.09% to 5.65bn m³, from 5.48bn m³ the previous year. Domestic production for 2018 was reported as being up 21% at 0.428bn m³, with exports to Greece up 6.76% at 0.673bn m³.

Gas demand cuts hit power

The fall in both imports and demand was less than November but continues the trend for the second half of the year and appears to confirm that Ankara is continuing with its policy of cutting back on gas, especially for power generation, in order to address the country's current-account deficit. 

Gas burn for December is reported as 1.40bn m³, down 16.5% on December 2017 and up only 2.7% on the month, despite December being comparatively cold.

Gas-fired power-plant operators continue to complain that successive hikes in the price Botas charges them for gas has left them unable to compete with other operators, with several believed to be facing possible bankruptcy or being obliged to transfer ownership of their generating assets in lieu of project finance debt. No figures were given for total imports for the whole of 2018 either by country or by importer.

Pipeline imports

Total pipeline imports for December were reported as 3.95bn m³, down 1.65% on the year but up 8.8% on November, with LNG imports from the month reported as 2.10bn m³, up 6.23% on the year, and up 97.4% on the month.

December continued the trend of previous months of lower pipeline imports from Russia, while those from Turkey's two other pipeline suppliers. Azerbaijan and Iran, rose. Russian imports for the month were reported as 2.26bn m³, down 14.0% on the year but up 10.4% on November, with imports from Iran reported as 0.896bn m³, up 13.1% on the year and up 6.8% on the month, and imports from Azerbaijan at 0.795bn m³, up 9.93% on the year and up 6.6% on the month.

Azeri imports had been expected to rise as a result of the commissioning in June last year of the Trans Anatolian Pipeline (Tanap) which is set to supply 2bn m³ of gas over its first year of operation, in addition to the 6.6bn m³ Turkey imports under its existing contract. 

Iran exports up

The rise in imports from Iran though is more difficult to explain, as it is higher than would be expected for a month one day longer and follows a similar rise of 6.3% in November, the month that US sanctions were fully re-imposed and when it was expected that Iran imports would start to fall in volume.

Turkey's Iran gas imports themselves are exempt from the sanctions regime but financial transfers are not and Botas is obliged to pay for the gas it imports into local Turkish banks where the money may be utilised by Iran to import goods not subject to sanctions. 

Given the high value of the gas imported, compared to Turkey's unsanctioned exports to Iran, analysts have predicted that Tehran may face problems finding ways to utilise its gas revenue from Turkey.

The fall in Russian imports in December continues the trend of previous months with imports by Turkey's state importer Botas, up 4.6% to 6.1bn m³, but those by Turkey's seven private importers, which imports solely Russian gas, down 19.0% at 0.76bn m³.

Individually imports by all seven were reported as being sharply down with the exception of Bosphorus Gaz which is majority-owned by Gazprom.

Industry sources confirmed late February to NGW that the private importers continue to face problems meeting their take-or-pay commitments with Gazprom, and are expected to continue facing problems through this year.
The bulk of LNG imports in December were reported as being supplied by Turkey's two contracted suppliers, Algeria (0.650bn m³) and Nigeria (0.381bn m³) with additional spot cargoes supplied by Qatar (0.528bn m³),  the US (0.163bn m³), Egypt (0.202bn m³), Equatorial Guinea (0.084bn m³) and Trinidad (0.91bn m³).

The volume of gas held in Turkey's underground gas storage facilities at the end of December was given as 3.17bn m³, 7.42% higher than December 2017 but down 5.7% on November, as is normal for the time of year.