The Future of RussianThe Future of Russian--Turkish Energy Turkish Energy RelationsRelations

Dr. Yurdakul YiğitgüdenDr. Yurdakul YiğitgüdenConsultant, former UnderConsultant, former Under--Secretary of Energy and Natural ResourcesSecretary of Energy and Natural Resources--TurkeyTurkey

3. South East Europe Energy Dialogue3. South East Europe Energy DialogueHyatt Regency Hotel Thessaloniki, 2Hyatt Regency Hotel Thessaloniki, 2--4 June 20104 June 2010

The Future of RussianThe Future of Russian--Turkish Energy RelationsTurkish Energy Relations�� Energy Status of Turkey Energy Status of Turkey

�� External Energy Policy of TurkeyExternal Energy Policy of Turkey

�� Energy Corridor TurkeyEnergy Corridor Turkey�� Energy Corridor TurkeyEnergy Corridor Turkey

�� Cooperation between Turkey and Cooperation between Turkey and RussiaRussia

�� ConclusionsConclusions

Primary Energy Mix of TurkeyPrimary Energy Mix of Turkey(2008: 106.3 Mil. Tep)(2008: 106.3 Mil. Tep)Source:MENRSource:MENR

N. Gas

Hydro+Wind+

27,8%

6,2%31,8%

4,2%29,9%

Hydro+Wind+Geoth+Solar

Oil

Coal

Others

Indigenous Energy Production and Indigenous Energy Production and

Primary Energy Demand of TurkeyPrimary Energy Demand of TurkeySource: MENR Source: MENR

150

200

250

0

50

100

1980 1990 2000 2008 2010 2020

Production

Demand

Crude Oil Imports of Crude Oil Imports of Turkey 2008 (21,7 Mil. t)Turkey 2008 (21,7 Mil. t)

9%9%

Iran35%

33%

14%

9%9%

Iran

Russia

S. Arabia

Irak

Others

Natural Gas Imports of Natural Gas Imports of Turkey 2008 (37.8 bcm)Turkey 2008 (37.8 bcm)

11% 4%Russia

62%12%

11%

11% 4%Russia

Azerbaijan

Algeria

Iran

Others

External Energy Policy of External Energy Policy of TurkeyTurkey

�� 1960’s: Iran,1960’s: Iran,

�� 1970’s: Iraq,1970’s: Iraq,

�� 1980’s: Qatar and Russia,1980’s: Qatar and Russia,�� 1980’s: Qatar and Russia,1980’s: Qatar and Russia,

�� 19901990--2010: Russia, Iran, Caspian 2010: Russia, Iran, Caspian Region Region

THE CASPIAN REGION AND THE CASPIAN REGION AND

EAST WEST ENERGY CORRIDOREAST WEST ENERGY CORRIDOR

�Strenghten the independence and prosperity of the

new Caspian States

�Encourage market economy and democratic

developments

�Stabilise the region by building the economic linkages

between the countries

�Help to diversify and secure the energy supply of

Turkey and her partners

�Increase the business opportunities for Turkish

Companies

BakuBaku--TbilisiTbilisi--CeyhanCeyhanCrude Oil Pipeline ProjectCrude Oil Pipeline Project

DELTA HESS KHAZAR

LIMITED

INPEX

South Caucasus N. Gas PipelineSouth Caucasus N. Gas PipelineSource: EBRDSource: EBRD

Pipelines of TurkeyPipelines of Turkey(Source: Botaş)(Source: Botaş)

GAS TO EUROPE

Nabucco Gas Pipeline ProjectNabucco Gas Pipeline ProjectSource:OMVSource:OMV

SOUTH EUROPEAN GAS RINGSOUTH EUROPEAN GAS RING� 7 July 2000 Concluding Statement signed between

European Commission, Turkey and Greece

�28 March 2002 MOU between BOTAS and DEPA

�23 Feb 2003 IGA between Turkey and Greece

�3 July 2005 Contruction start of the TGI

�18 Nov 2007 Official inauguration of the TGI

�4 Nov 2006 IGA between Greece and Italy

�11 June 2008 Formation of the IGI Poseidon SA

Nabucco Gas Pipeline ProjectNabucco Gas Pipeline ProjectSource:OMVSource:OMV

History of RussianHistory of Russian--Turkish RelationsTurkish Relations�� Close commercial and Political Relations 1492Close commercial and Political Relations 1492--1512: Ivan III 1512: Ivan III

sends Ambassador Pleshchiev to Beyazid II.sends Ambassador Pleshchiev to Beyazid II.�� Competition in Ukraine and West of the Caspian Sea 1512Competition in Ukraine and West of the Caspian Sea 1512--

1647,1647,�� Wars but lively trade 1647Wars but lively trade 1647--1783,1783,

Hostile era 1783Hostile era 1783--1918 Turco1918 Turco--Russian wars,Russian wars,�� Hostile era 1783Hostile era 1783--1918 Turco1918 Turco--Russian wars,Russian wars,�� Intense cooperation 1920Intense cooperation 1920--1941; Friendship and Neutrality 1941; Friendship and Neutrality

agreement of 17 Dec 1925,agreement of 17 Dec 1925,�� Stalin demands territories from TR 1945Stalin demands territories from TR 1945--1953; Turkey enters 1953; Turkey enters

NATO,NATO,�� Good economic relations despite the cold war 1954Good economic relations despite the cold war 1954--1990,1990,�� Intense commercial ties with the Russian Federation 1991Intense commercial ties with the Russian Federation 1991--,,�� A strategic partnership since 2009 ?A strategic partnership since 2009 ?�� 2010 High level strategic cooperation council, 17 agreements2010 High level strategic cooperation council, 17 agreements

Energy Cooperation Energy Cooperation between Turkey and Russiabetween Turkey and Russia

�� 1967 Agreement between USSR and TR to build Aliağa Refinery and 1967 Agreement between USSR and TR to build Aliağa Refinery and Orhaneli Power Plant,Orhaneli Power Plant,

�� 1984/1986 Natural Gas Agreement of 6 bcm, gas flow started in 1984/1986 Natural Gas Agreement of 6 bcm, gas flow started in 1987 via Balkans,1987 via Balkans,

�� 1996/1998 Second Natural Gas Agreement of 8 bcm,1996/1998 Second Natural Gas Agreement of 8 bcm,�� 1997/1999 Blue Stream Agreement of 16 bcm, gas flow started in 1997/1999 Blue Stream Agreement of 16 bcm, gas flow started in �� 1997/1999 Blue Stream Agreement of 16 bcm, gas flow started in 1997/1999 Blue Stream Agreement of 16 bcm, gas flow started in

2003,2003,�� 20052005--2009 ongoing negotiations on Samsun2009 ongoing negotiations on Samsun--Ceyhan Crude Oil Ceyhan Crude Oil

Pipeline and Bluestream II,Pipeline and Bluestream II,�� 20082008--2009 negotiations on Akkuyu Nuclear Power Plant,2009 negotiations on Akkuyu Nuclear Power Plant,�� Putin visit, 6 Aug 2009 MoU on the routing of Southstream through Putin visit, 6 Aug 2009 MoU on the routing of Southstream through

Turkish Territorial waters,Turkish Territorial waters,�� 19 Oct 2009 MoU on the Samsun19 Oct 2009 MoU on the Samsun--Ceyhan Pipeline,Ceyhan Pipeline,�� Turkey is the 3rd largest customer of russian gas after Germany and Turkey is the 3rd largest customer of russian gas after Germany and

ItalyItaly�� Medvedev visit 11Medvedev visit 11--12 May 2010, Nuclear Deal 12 May 2010, Nuclear Deal

Bluestream Natural Gas Bluestream Natural Gas Pipeline Pipeline (Source: offshore(Source: offshore--technology.com)technology.com)

South Stream N. Gas South Stream N. Gas Pipeline ProjectPipeline ProjectSource: GazpromSource: Gazprom

ConclusionsConclusions

�� Energy Cooperation would be the backbone Energy Cooperation would be the backbone of a Strategic Partnership between Turkey of a Strategic Partnership between Turkey and Russia,and Russia,

�� Additional Russian gas may flow via Turkey Additional Russian gas may flow via Turkey to Europe,to Europe,

�� Additional Russian gas may flow via Turkey Additional Russian gas may flow via Turkey to Europe,to Europe,

�� Russian gas supply via Turkey may harm Russian gas supply via Turkey may harm the European efforts for diversification,the European efforts for diversification,

�� Future Russian interference in the internal Future Russian interference in the internal affairs of the Turkic countries in the affairs of the Turkic countries in the Caucasus and Central Asia may cause Caucasus and Central Asia may cause Turkey to change its policy towards Russia.Turkey to change its policy towards Russia.

Thank you Thank you

yurdakulyigitguden@mynet.comyurdakulyigitguden@mynet.com