Daily Newsletter

18 September 2023

Daily Newsletter

18 September 2023

Russia’s gas hub plans in Turkey delayed

There are internal disagreements as to who is in control.

Alfie Shaw September 15 2023

Russia’s plan to create a “gas hub” in Turkey is faltering due to disagreements over who should be in control of it, sources told Reuters.

Following the disruption to the Nord Stream pipeline, Russia and Turkey have become more aligned on gas matters. The TurkStream and Blue Stream pipelines across the Black Sea are now a key channel for Russian gas to flow to Europe. In October 2022, Russian President Vladimir Putin proposed the idea of a gas hub (base for gas supplies) in Turkey to increase demand for Russian gas and facilitate EU purchases. Turkey is heavily reliant on Russian gas, importing 45% of its supplies from Russia in 2021 and 40% in 2022. In 2020, Turkey was the seventh-biggest gas consumer in the world.

However, the gas hub plans face delays as Moscow and Ankara argue over who is in control of the plans. An anonymous source close to the project told Reuters: “There are managerial issues, they are fighting for who should manage the hub.”

Furthermore, there are doubts as to whether it is a feasible project. Bengisu Özenç, director of the Sustainable Economics and Finance Association, an NGO based in Ankara, said: “Turkey lacks the necessary infrastructure, both pipeline network and gas storage capacity, and the political stability to sustain the role of a gas hub.” In February 2023, Kremlin spokesman Dmitry Peskov said there could be delays to the plans due to the devastation wrought by the Kahramanmaras Earthquake. The aforementioned disagreements have caused the latest delays, however.

Turkey is also looking to ensure gas supplies from elsewhere. In January 2023, Turkey signed a 13-year deal with Bulgaria that includes the sale of 300 million cubic metres of gas.

The kernel of a sustainable energy industry also exists in Turkey. In 2021, 500MW of hydropower was installed. However, hydropower’s role in the Turkish energy mix has decreased from 12% of energy consumption in the 1990s to 7.68% in 2021.

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