Turkey seeks additional 6 bcm of LNG, partly from Qatar

Talks with Qatar on the purchase have begun, but the world's biggest LNG producer may not provide all of the additional fuel, Yıldız told reporters late on Tuesday. Turkey could also buy from the United States if it is willing to sell. Turkey wants to procure the LNG by 2015, he said. The country of 75 million people is heavily dependent on imported energy and is seeking to diversify supplies as demand grows. It is set to overtake Britain as Europe's third-biggest electricity consumer within a decade.

Turkey buys natural gas from Russia, Iran and Azerbaijan and LNG from Nigeria and Algeria under long-term contracts. It currently has no long-term contracts with Qatar, which mainly sells to Asian markets. Natural gas imports, mainly from Russia, Iran and Azerbaijan, meet around 45 percent of Turkey's demand for heat and power, according to the International Energy Agency (IEA).

As part of efforts to reduce dependence on Iranian and Russian, Ankara last week signed a $12 billion deal with Abu Dhabi's TAQA to mine lignite coal and build new power plants capable of producing up to 8,000 megawatts (MW) by 2020. Turkey currently generates approximately 47 percent of its annual electricity from power plants using natural gas.

Turkey has asked Qatar to help build an LNG import plant on the Gulf of Saros, an inlet in European Turkey, which would have an annual capacity of 5-6 billion bcm. US Republican Sen. Richard Lugar said last month that Congress should give NATO allies access to burgeoning US natural gas supplies to help reduce their dependence on natural gas from Russia and help wean Turkey off Iranian purchases.

US domestic production has boomed, leading to a glut. But domestic manufacturers argue opening up exports would raise their gas prices, and have attracted some strong supporters for their cause in Congress. Turkey's daily gas demand was about 125 million cubic meters in late 2012 and is likely to rise to nearly 220 million during the harsh winter months, officials from the Ministry of Energy and Natural Resources say.

Insufficient facilities and infrastructure to store gas along with high gas prices put Turkey in a bind, particularly due to a “take or pay” condition that requires the country to import predetermined amounts of natural gas in almost all of its natural gas import agreements. Ankara has to pay suppliers -- Russia, Azerbaijan and Iran -- a specified amount of money irrespective of whether it actually imports all the natural gas it agreed to purchase.

According to data from the Ministry of Energy and Natural Resources, the failure to import natural gas that was fixed by the “take or pay” condition amid falling demand cost Turkey almost TL 3 billion ($1.68 billion) between 2009 and 2012.

KRG to truck more crude to Turkey, firm says

Abu Dhabi Reuters

Trucked exports of crude oil from the Iraqi Kurdistan to Turkey may reach 20,000 barrels per day (bpd) in a few weeks, the chief executive of Genel Energy said, in a growing trade that central government in Baghdad sees as illegal.

The export of crude from the Taq Taq oil field by truck to Turkey shows the Kurdistan Regional Government's (KRG) growing frustration with Baghdad as it moves towards greater economic independence. "The KRG has given us approval to begin trucking relatively small volumes of crude," Genel CEO Tony Hayward told reporters on Wednesday, adding that exports of the oil would probably rise to 10,000-20,000 bpd in the next few weeks. Taq Taq produces around 100,000 bpd and 35,000 bpd is fed into the Bazian refinery. Genel Energy has a 45 percent stake in the field and apart from the direct exports to Turkey, the majority of the oil is shipped to local refineries. Hayward, former head of oil major BP, said the Anglo-Turkish company he now leads was going to be compensated for the oil shippped to Turkey by the KRG, which will receive oil products from Turkey in return for the crude.

The KRG halted exports through the Baghdad-controlled Iraq-Turkey pipeline last month in a dispute over payments to oil companies operating in Kurdistan, and officials in Baghdad say such a unilateraly move to increase the trade of Kurdish oil could make it even more difficult to reach a deal on payments. Genel's activities proceed on track nevertheless.