Turkey Hopes to Become Europe’s Gas Alternative

Halil Dogan, a gas pipeline worker, checks the valves at the Yapracik installations of Turkey's state-run BOTAS gas company on the outskirts of Ankara

ANKARA(AP)–As Europe is once again held hostage to the gas quarrels between Ukraine and Russia, Turkey is hoping to become an alternative route for the continent’s energy imports–but its ambitions face tough practical and political challenges.

Turkey is pushing plans for a pipeline that would bypass both Russia and Ukraine in a bid to strengthen its role as an energy crossroads between Central Asia and the Middle East to Europe.

The 2,050-mile (3,300 kilometer) projected Nabucco pipeline is backed by the EU and the United States and would run from the Caspian Sea through Azerbaijan and across Turkey to Austria. Construction is scheduled to start next year with hopes for completion by 2013.

The project is fraught with complications but the EU sees it as crucial to breaking its dependence on Russian energy, potentially enhancing Turkey’s hand in overcoming stiff EU resistance to letting it into the elite club of nations.

"The Southern Corridor is one of the cornerstones of our diversification policies," EU Energy Commissioner Andris Piebalgs wrote in his blog recently. "We all have the need to open a real corridor to make it attractive for Central Asian countries to pipe their gas to the West, to Turkey and to the European market."

Piebalgs said "even if the volumes of gas that we can receive from this area are limited, in the best case no more than 5 percent of Europe’s consumption, the project has huge importance because it will open the door to a region, the Caspian Sea, that has the largest gas reserves in the world."

Although Europe will most likely remain to some extent dependent upon Russian supplies, the project would alleviate problems such as the sudden shut-off in deliveries witnessed this month. Russia provides over a quarter of Europe’s gas, and 80 percent of that moves over Ukraine’s pipelines.

"God willing, we won’t allow our people to freeze," Energy Minister Hilmi Guler said. "It is for this reason we want to start Nabucco, it could become a key artery to Europe."

Christian Dolezal, a spokesman for the Nabucco project, said Europe will require more gas in coming years.

"Turkey with its important strategic position will become an energy hub if Nabucco is realized and this would be a win-win situation for Europe and Turkey," Dolezal said.

But the project has already run into problems.

First, there is yet no commitment from the major potential suppliers, Azerbaijan and Turkmen’stan, to utilize the pipeline’s 31 billion-cubic-meters carrying capacity, said Ferruh Demirmen, a Houston-based independent energy expert. Azerbaijan already exports gas to Greece through Turkey and is expected to join the Nabucco project, while Turkmen’stan has expressed strong interest as well, but binding agreemen’s have yet to be signed.

Second, the global financial meltdown has put a damper on the project, which carries an estimated price tag of $11 billion (euro8 billion). Public-sector financing could make a difference, particularly if the EU backs up its commitment with extra funds, Demirmen’said.

Finally, there are concerns that Russia and China have already locked up most Central Asian gas supplies, meaning Nabucco would have to cross Iran, which has been at loggerheads with the West over its nuclear program.

"Turkey and European countries are late for this job," said Tacidar Seyhan, a member of the energy commission of Turkey’s parliament.

Securing the Iranian route would require significant political dialogue and a softening of U.S. sanctions against Iran. Many question whether Iran’s hardline Islamic leadership would be any more reliable an energy partner than Moscow.

Moscow, meanwhile, is also pushing hard for alternative pipelines to Europe for its own gas — the so-called "Nord Stream" through the Baltic Sea to Germany and the "South Stream" through Bulgaria.

"If both Nord Stream and South Stream are constructed, Nabucco will likely not be. Russia’s dominant market position will be preserved and enhanced," said Zeyno Baran, director of the Center for Eurasian Policy at the Hudson Institute.

Others suggest the solution to Europe’s energy problems lie beyond securing pipeline routes.

"It is time we stopped thinking of energy in these geopolitical terms. Europe can get a lot of energy by saving energy, by consuming much less and also by adopting sustainable energy systems that do not burn hydrocarbon fuels," said James Paul, executive director of the Global Policy Forum, a New York nonprofit group.

"The safe corridor today may be the unsafe corridor tomorrow," he said.

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