Energy minister gives green light to Syria electricity plan

“I must say that we're evaluating this as a positive step,” Yıldız told journalists, speaking about a report that Syrian officials are planning to resume electricity purchases from Turkey. Syria stopped purchasing electricity from private Turkish providers in early October, just days after the Turkish military struck targets in Syria in retaliation for the Syrian shelling of the Turkish border town of Akçakale, an attack which killed five civilians.

In comments carried by the Cihan news agency, Yıldız said that allowing the private provider to deal with Damascus was a positive step when “looking at this [situation] with respect to the Syrian people's humanitarian situation.” Turkey provides around 20 percent of Syria's electricity needs, supplying around 232.2 million kilowatt hours of electricity to the country monthly.

Turkey had previously threatened to cut electricity supply to Syria, though officials concluded that it would hurt Syrians in the war-torn north more than it would hurt Damascus, with which Ankara is bitterly at odds.

Yıldız suggested that getting power flowing across the border again would first require the Turkish Electricity Production Company (TEİAŞ) to draw up new contracts with Syrian buyers, which could take as long as 10 days.

Turkey, Iran wrangle over gas discount

Yıldız also spoke about the ongoing natural gas price negotiations with Tehran, which has offered Ankara an unspecified discount on natural gas prices in the coming year. Though the minister confirmed that Iran had offered a reduced rate during the price negotiations, he told the press that “this discount isn't at the level we were expecting,” and said that the negotiations would continue.

Yıldız said last month that Ankara was planning to change the terms of energy trade between the two states and suggested that Turkey would suspend its “take or pay” contract with Iran next year. That system requires Turkey to buy a predetermined volume of gas each year, much of which it often does not use. Despite the shakeup in the contract, Yıldız stated that Turkey planned to continue to maintain the percentage of gas purchased from Iran at 18-20 percent of its total gas supply.

According to a 1996 gas deal, Turkey must purchase between 7.5 and 10 billion cubic meters of gas per year from Tehran and negotiates the exact volume and price before the start of each year. Known as the “take or pay” system, the Ministry of Energy and Natural Resources estimates that the scheme has forced Ankara to pay Tehran $725 million for unused gas over the last three years. Although Turkish firms have invested heavily in gas fields in the semi-autonomous territory of Iraqi Kurdistan, the country remains heavily dependent on Iran, Russia and Azerbaijan for its gas supplies. Turkey imports roughly 70 percent of all energy from abroad.

Government mulls state oil firm IPO

The Turkish Petroleum Corporation (TPAO), Turkey's state-owned oil firm, meanwhile is in talks with the Treasury, Yıldız said, and may hold initial public offerings (IPO) for itself and its affiliated pipeline company BOTAŞ. The minister said on Friday that BOTAŞ will cost the state nearly $3 billion next year. BOTAŞ has long borne the brunt of Turkey's expensive energy import regime, which saw the company post a $1.3 billion loss in 2011. Officials have offered a similar figure for the 2012 fiscal year.

Turkey signs $350 mln Iraq oil drilling deal

Ankara, Reuters

Turkey has signed a $350 million deal to drill 40 oil wells in the southern Iraqi Basra area and is in talks with Baghdad to drill 7,000 wells across Iraq, Energy Minister Taner Yıldız said on Friday.

Turkey's growing energy involvement in Iraq comes despite tensions with Baghdad over Ankara harboring Iraq's fugitive Vice President Tariq al-Hashemi, who was sentenced to death by an Iraqi court for the second time on Thursday. Iraq has also asked Turkey to stop attacking Kurdish terrorists sheltering across the border in northern Iraq, a Kurdish autonomous region which Baghdad has little control over and with which Ankara has forged close ties in recent years. “We continue to work with the central government on opening 7,000 wells across Iraq as a whole,” Yıldız told a news conference in the Turkish capital.

Separately, Yıldız warned that the government would review Italian energy firm ENI's investments in Turkey if it proceeded with plans to explore for natural gas in Cyprus. Cyprus said on Tuesday that it planned to start negotiations with ENI, South Korea's Kogas, France's Total and Russia's Novatek on the potential development of natural gas fields off the Mediterranean island.

Turkey, which has been at diplomatic loggerheads with Cyprus for decades, claims that the island has no authority to explore for offshore gas. “If ENI becomes involved in the exploration in southern Cyprus, we will sit down and reconsider its investments in Turkey,” Yıldız said.

The negotiations would cover four offshore blocks lying south and southeast of the island, close to a gas find last year for which US-based Noble Energy already has concessions over.