Azerbaijan Sends More Gas to Turkey after Iran Halts Exports

Azerbaijan ramped up this week the supplies of natural gas to Turkey amidst technical problems that halted imports from Iran, one of the key suppliers of gas to the Turkish market.

"Amidst the technical problems observed in recent days in connection with the import of natural gas from Iran to Turkey, the Turkish side applied to the Azerbaijan Gas Sales Company (AGSC) with a request to import additional volumes of gas to compensate for the temporary shortage,” Ibrahim Ahmedov, official representative of the State Oil Company of Azerbaijan (SOCAR), told RIA Novosti.

“The request received from Turkey was considered by the company. It was decided to increase the volume of gas exported from Azerbaijan to Turkey, within the existing possibilities and in accordance with the demand," he added.

Last week, Iran halted gas flows to Turkey for up to ten days due to technical problems at a pressure-boosting station in Turkey’s territory, a claim denied by Ankara. The issues caused serious power outages in Turkey causing manufacturing companies stop production. Iran, which provided 16 percent of Turkey’s overall natural gas imports from January-October in 2021, announced the resumption of deliveries on January 21.

However, the Turkish authorities said the restored supplies were lower than the contracted amount, which is 28 million cubic meters (more than 988 million cubic feet) of gas per day. Ankara claimed that the reason behind the temporary cut in Iranian gas supplies was in fact the shortage of blue energy in the domestic market of Iran but not technical issues. It was revealed during a Turkish delegation visit to Tehran recently that Iran was trying to meet growing demand in domestic use, which caused a sudden stoppage in exports to Turkey. 

Turkish Energy and Natural Resources Minister Fatih Dönmez said Iran failed to meet some technical conditions related to the set up in the natural gas contract with Turkey. Ankara is demanding that the case be resolved in the coming days and warned that it may seek international arbitration if needed.

Turkey relies heavily on natural gas imports from Russia, Iran and Azerbaijan, with the latter increasing its role in the Turkish market. Turkey purchases almost the entire 40-50 bcm portion of its annual gas consumption from foreign markets. In 2019, the overall imports of natural gas were 48.6 bcm. According to January 2020 data compiled by EMRA, Ankara pays $12-13 billion for gas imports annually.

Azerbaijani gas has been flowing to Turkey on the Baku-Tbilisi-Erzurum pipeline since 2007. Turkey received 6.6 billion cubic meters (bcm) of gas from the South Caucasus country annually until the contract ended in April 2021. In October 2021, Baku and Ankara shook hands to extend the contract for the delivery of 11 bcm of Azerbaijani gas to Turkey until the end-2024.

Despite the long-term operation of the Baku-Tbilisi-Erzurum line, the Trans Anatolian Pipeline (TANAP), the integral part of the Southern Gas Corridor mega project, expanded the Turkey-Azerbaijan energy cooperation.

TANAP is the largest and most expensive part of the three-segmented Southern Gas Corridor, which measures 1,878 kilometers in length. It came online with the start of commercial supplies in June 2018. Six bcm out of SGC's overall transportation volume of 16 bcm is slated for Turkey via TANAP. The remaining 10 bcm is allocated for Europe. The Shah Deniz offshore gas field beneath the Azerbaijani sector of the Caspian Sea is the one and only source for gas supplies to the SGC mega-pipeline. As of September 1, 2021, TANAP pumped 6.7 bcm of natural gas from Azerbaijan to Turkey.