Embed Size (px)
Citation preview
Turkey:An Oil & Gas Inflection PointFINAL PROJECT - BRIEFING
STEPHANIE MORRISONFEBRUARY 23, 2016INTL – 580 INTELL IGENCE COMMUNICAT IONS
Executive Summary:It is likely Turkey’s oil and gas sectors will improve over the next 12 to 24 months due to: Turkey’s role as an energy transit hub, connecting energy-rich
countries with high-demand Europe
Economic growth is driving increased energy demand
Continued investment and development of pipeline infrastructure and storage capacity
Expansion of relationships with suppliers and partners
Dependence on oil and gas imports due to low domestic supply
Key Findings Energy providing Eastern European and Middle Eastern
countries depend on Turkey for access to high-demand Western European consumer markets.
Fastest growing emerging energy market in Europe. Consumption rates rising, unable to keep up with demand
Infrastructure development of major pipelines underway
Expansion of key strategic relationships/partners – EU, Iraqi-Kurds, Azerbaijan, Israel, Qatar
Geo-political conflicts exist with Syrian crisis, ISIS and tension with Russia
Domestic Oil and Gas reserves are limited – making Turkey energy dependent and a major energy importer.
Imports
96%
98%
Turkish Energy Imports
oil gas
Turkey’s Role as an Energy Transit Hub Turkey has an advantageous
geo-strategic position in the region Seen as a key player in energy dynamics Turkey crucial link between EU,
Middle Eastern and Russian oil and gas assets Pipeline routes are becoming important network for regional
power and influence Reliable economic and political partner
Emerging Economy Fastest growing economies in Europe
GDP - 3.8% expected in 2016 -2017 Currently 17th largest economy in world Projected to become #12 by 2023 Energy consumption rising – with average
yearly demand at 5.7% Energy environment conducive to direct
foreign investment
Infrastructure: Pipeline Development Southern Gas Corridor is a planned long-term comprehensive
3-phased pipeline project to deliver natural gas to Turkey, European consumers and other markets. Involves 7 countries and 11 companies Estimated project cost – USD $6-7 billion
Trans-Anatolian (TANAP): Extends across Turkey from Azerbaijan. Construction started in 2015; completion targeted for 2018.
Trans-Adriatic (TAP): Connector line from Greece to Italy via Europe KRG: New natural gas pipeline (Sirnak) from northern Iraq that parallels oil line to
Kirkuk-Ceyhan in Turkey
Regional RelationshipsIt’s centralized position exposes Turkey to dynamic geo-political relationships: Russia: Over-dependence on Russian oil and gas
drives Turkey to seek other relationships. Recent military events are straining diplomacy
Israel: Re-establishing diplomatic ties after five year absence
Iraqi-Kurds: mutual dependence is encouraging strong collaboration
European Market (EU): demand for natural gas and oil transited through Turkey encourages bilateral cooperation
Oil Only two major importing crude and
condensate oil pipelines in operation Kirkuk-Ceyhan Baku-Tbilsi-Ceyhan
Oil imports projected to double in next 10 years
Import dependent – over 90% comes from other countries; mainly Iraq (27%) Iran (26%) and Russia
Iraqi-Kurds are supplying oil independently via the KRG line
Gas Main source of energy-surpassing oil
in 2012 Imports 98% of its natural gas supply
from Russia, Azerbaijan, Algeria, Iran and Nigeria
2nd largest consumer of Russian gas; imports over 60%
Depends on imported gas to generate electricity – 50% New gas pipeline from Iraqi-Kurds (Sirnak) on-line in 2018
Analytic Confidence High Corroborated and reliable sources Low analyst subject expertise Moderate subject complexity Minimal timeframe for completion Worked alone without supervision No peer evaluation or input
ReferencesRetrieved from: http://i.tmgrup.com.tr/dailysabah/2014/04/19/HaberDetay/1397897218766.jpg (high) Retrieved from: http://blogs.ft.com/beyond-brics/files/2012/07/Turkeys-Petroleum-and-Pipeline-Corporation.jpg (high) Retrieved from: http://kurdistantribune.com/wp-content/uploads/2013/11/Erdogan-and-Brazani.jpg (high)Retrieved from: http://www.pwc.com/world2050 (high)Retrieved from: http://tinyurl.com/z5zz5ky (high)Retrieved from: http://tinyurl.com/hmwnq2r (high)
