With regard to gas price security, Turkey aims to position itself as a virtual gas trading point (VTP) for the spot gas market under the title “Istanbul Benchmark.” Turkish aspirations to get many countries’ natural gas priced as “Istanbul Benchmark” will pave the way for better gas-to-gas competition or any liquidity in the region.
Turkey’s long-term energy strategy is based on four pillars: the route and source diversification of oil and natural gas imports, increasing the ratio of renewable and indigenous energy sources, increasing energy efficiency, and adding nuclear energy to Turkey’s energy mix.
To this end, as LNG is becoming widespread on the Turkish energy market, Turkey has managed to reduce Russia’s share in the total Turkish gas imports. While Russian exports accounted for 52% of Turkey’s gas import basket, they decreased to 33% last year.
In terms of gas supply security, the Trans-Adriatic Pipeline (TAP) activation and recent gas discoveries in Turkey’s Sakarya Gas Field provide additional opportunities for the European markets to further diversify the gas routes and sources. Luca Schieppati, managing director of TAP, believes that bringing Azerbaijani gas from Turkey to Italy through TAP will reinforce Europe’s security and diversification of supplies.
Overall, “TurKEY for Energy” is Turkey’s lucrative offer to its European partners to build together a reliable and sustainable energy policy. The EU leadership ought to know that Turkey, following the completion of the Southern Gas Corridor (SGC) with the activation of TAP, will become a sine qua non for European gas supply security. Having consolidated its energy infrastructure, Turkey is also becoming an emerging gas trading hub under
“Istanbul Benchmark”. 2021 will mark the establishment and operation of the natural gas futures market in Turkey.
Notably, on the first day of the project on December 31, 2020, 10.9 million cubic meters of natural gas was transported to Europe via TAP.
TAP is the Southern Gas Corridor’s European section, enhancing Europe’s energy security and contributing to decarbonization and gas supplies diversification.
TAP’s shareholders include BP (20%), SOCAR (20%), Snam (20%), Fluxys (19%), Enagás (16%) and Axpo (5%).