Is Turkey turning into a transit country for energy to Europe?

Russian President Vladimir Putin said his country may redirect Nord Stream gas supplies to the Black Sea and turn Turkey into a corridor for Russian gas to Europe after establishing a major European gas center on its soil.

The proposal - which many described as a high-caliber surprise and greeted by Turkey and Europe with skepticism - opens a lengthy discussion about the feasibility of the idea and its applicability, as well as its repercussions on Turkey's economy and its relations with both Russia and the European Union.

Turkey and energy

Turkey with energy has a thorny and complex story. As a rising regional country, it is in dire need of primary resources, especially energy sources, but it has few of them.

Turkey relies on imports to secure about 71% of its need for energy resources, according to figures from the European Statistical Office (Eurostat), and this percentage rises with regard to natural gas, reaching 99%.

The energy bill cost Turkey 28.9 billion dollars in 2020, and the cost rose to 50.7 billion dollars in 2021, an increase of 75%, and the cost is expected to be greater this year on the sidelines of the rise in energy prices due to the Russian-Ukrainian war.

Thus, energy resources are at the forefront of the items that contribute to the Turkish current account deficit.

Also, this high degree of dependence on the outside in energy resources may have political costs, especially since Turkey differs in some foreign policy files with countries that make the list of its energy suppliers, such as Russia and Iran.

Therefore, Turkey has worked for many years to reduce its dependence on the outside in terms of energy materials on the one hand, and to diversify its import sources on the other hand.

This included increasing reliance on renewable energy, especially solar, increasing import - especially natural gas - from countries closer to Turkey in foreign policy, such as Azerbaijan and Qatar, and increasing the pace of search for self-energy sources.

In this latter framework in particular, Turkey's research and exploration activities and exploration for energy resources - especially gas - are located in the eastern Mediterranean and the Black Sea.

Over the past decade, Turkey has placed the energy file at the forefront of its priorities, and the eastern Mediterranean file in particular has become at the top of the many intertwined foreign policy files, ahead in the past few years over the Syrian issue and the conflict in the South Caucasus and other files, as Ankara views it from The angle of energy security first, and the geopolitical competition in the region with other parties second.

The importance of this file has increased Turkey's discoveries of natural gas in the Black Sea, which the government promises to be within reach next year 2023, the year of the founding of the Republic, as well as the year of the elections, which are described as articulated.

On the other hand, Turkey still hopes to resolve the conflict in the eastern Mediterranean by peaceful means, proposing to hold an international conference in which all countries bordering the eastern Mediterranean will participate to agree on how to demarcate the maritime borders and share wealth.

As part of its endeavors in this file, Ankara is still looking for partners in the eastern Mediterranean, especially after the announcement of the Eastern Mediterranean Gas Forum at the beginning of 2019, which ignored its rights and interests, even though it has the longest coastline on it, and responded to it with an agreement to demarcate the maritime borders with the Libyan Government of National Accord. In the fall of the same year.

Finally, Ankara still dreams and hopes to turn into an energy transit country for the European continent, and in this context it is still seeking to persuade Egypt to demarcate the maritime borders between the two countries, as well as its proposal for the occupying power to adopt a project to transport “Israeli” gas to Europe via Turkey, not Greece, nor Especially after the decline in US support for the "EastMed" project.

It is difficult to be certain about the feasibility of the project and the prospects for its success in the future, in light of the ambiguity of the scene related to the war and its repercussions on Europe, especially since the establishment of the center will require a period of time during which conditions may change in this direction or that.

Russian proposal

Putin said that his country is ready to resume gas exports to Europe via Nord Stream 2 through the Baltic Sea, and that Turkey could be an option to supply gas to Europe by establishing a gas distribution center that contributes to transportation and price setting.

While the Russian President saw that the proposal was safe at a high level and economically feasible, Turkish Minister of Energy and Natural Resources Fatih Donmez considered it “possible, but it needs a comprehensive evaluation from the legal, technical and commercial aspects,” and that it is too early to issue an estimate on it.

On the other hand, the Turkish president seemed more enthusiastic, so he instructed the ministry to start work on the project and cooperate with Russian institutions, noting that the "Thrace" region in the northwest of the country is the most suitable region for him.

In the first European reactions, the French presidency said in a statement that the Russian president's proposal was "meaningless" in light of the European Union's policy to reduce dependence on his country's gas, adding that the union would not be one of the importers of Russian gas through Turkey if the project was implemented.

There is no doubt that such a project, if it is destined to move into practice, will have positive repercussions on Turkey.

On the economic level, it will not suffer from shortages or worry about what it needs of natural gas, and it will get preferential prices, as well as the revenues of gas transportation to Europe on its economy.

On the political level, this is a gain in addition to the agreements and mediations it has achieved since the Russian-Ukrainian war.

And strategically, this would enhance the roles it plays in the region and the world and give it additional power cards vis-à-vis the European Union in the first place.

Technically, Turkey appears to be able to meet the project's requirements through the Turkish Torrent Line, which has a total capacity of 31.5 billion cubic meters annually, which can fully satisfy the needs of Eastern and Southern European countries, according to some reports.

But this will need to build a gas center with a global capacity and not a local one, according to the Turkish president, which will need time and funding, if it proves its economic feasibility.

The main obstacle to the project is the confidence gap between Russia and European countries, as the proposal came on the sidelines of the Russian-Ukrainian war and after targeting the Nord Stream line, which Putin accused the United States of being behind.

Perhaps the project's link with Turkey will also be an additional reason for some countries to reject it, as did France, which issued its first position on the project.

Is the project doomed to fail before it begins?

Not necessarily, because - after feasibility studies, especially from a purely commercial angle - it will be subject to the interaction of several factors, foremost of which is the outcome of the war in Ukraine in terms of time and intensity of battles as well as the victorious and defeated parties.

It is also directly related to the extent of Europe's suffering during the coming winter, and thus assessing the feasibility of reducing Russian gas imports.

Among those factors is the extent of the unity of the European position within the Union regarding the project, especially after the right-wing advance in some of its countries.

Finally, there is no doubt that Turkey's relations with both Russia and the European Union also affect, albeit indirectly, the project's prospects.

Accordingly, it is difficult to ascertain the extent of the feasibility of the project and the prospects for its success in the future, in light of the ambiguity of the scene related to the war and its repercussions on Europe, especially since the establishment of the center will require a period of time during which circumstances may change in this direction or that.

But in summary, if the logic of politicizing the gas/energy file between Russia and Europe in terms of Russian policies and/or European impressions recedes, this may encourage a project of this kind, especially if the threats facing Nord Stream continue.

Finally, an ambitious project of this kind, if realized, may have direct and indirect effects on Turkey’s relations with Russia and its Western allies, strengthening the relationship with the former and deepening the suspicions of others, who expressly express their reservations about Turkey not participating effectively in sanctions against Russia. And they may view the project as additional Turkish support for Russia, albeit implicitly, despite Ankara’s legal, political and economic justifications for its position.