Turkey in Turkish Stream talks with Russia: Minister

ANKARA - Anadolu Agency

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A continuing delay in the Turkish Stream energy project stems from factors in both Russia and Turkey, Energy Minister Taner Yıldız said Aug. 4.

“The pipeline project to carry Russian gas to Europe, with Turkey as a transportation hub, was caused because the Russian side was late in delivering the coordinates for the construction route, and because of talks to form a new coalition government in Turkey,” Yıldız said.

“The delivery date for the route coordinates had been extended until June 10, or to a later date. Turkey could not begin any construction without these coordinates,” said Yıldız, speaking to Anadolu Agency in an exclusive interview.

“The inter-governmental agreement for the project should be ratified in parliament, and Turkey must first form a new government through either a coalition or a snap election,” Yıldız added, since talks for a coalition government are ongoing among Turkish political parties.

Russian President Vladimir Putin scrapped the South Stream project last December and announced Turkish Stream, which is slated to deliver Russian natural gas to Europe through the Black Sea and Turkey by four pipelines with a capacity of 63 billion cubic meters.

Turkey has also agreed to a 10.25 percent discount on Russian gas purchases, and a $1 billion retroactive payment is due on the agreement, which was dated to Jan. 1, Yıldız said, adding that Turkey was the second-largest consumer of Russian gas.

Turkey has said Russian gas prices should not be higher than what EU countries pay and that the price gap is closing, he added.

The minister said the discount and the construction of the pipeline were separate issues, but being handled simultaneously at Russia’s demand. Both agreements are yet to be signed.

Turkey will build the 265-kilometer section of the pipeline traversing its territory, while the section beneath the Black Sea will be constructed by Russia, Yıldız said.

Touching on a talk with Maros Sefkovic, vice president of the European Commission in charge of the Energy Union, Yıldız said, “As an EU member, if you demand natural gas on the one hand and refuse the project on the other, it would create a contradiction, which Europe needs to overcome.

The minister also said demand for natural gas continues to grow in Europe.

Turkey hopeful to win Iran arbitration case

Yıldız said Turkey was hopeful of winning a dispute on gas prices with Iran at the International Court of Arbitration (ICA), as litigation has ended, with a decision expected to be delivered soon.

Turkey has repeatedly objected to the high cost of Iranian gas and demanded a discount by taking the case to the ICA. Ankara currently takes 10 billion cubic meters for $487 per 1,000 cubic meters.

“I think the court has made its decision. We opened the case expecting to win it, and we maintain the same belief now,” Yıldız said.

Asked about relations with Iran after the agreement on nuclear energy between Iran and world powers, Yıldız said Turkey had always maintained good relations with Iran and would continue to do so.

On a pipeline between Europe and Iran that is planned to carry 35 billion cubic meters of Iranian gas, Yıldız said Turkey would help with the construction process for the section passing through Turkey.

Yıldız said he recommended that Turkish investors place funds in Iran’s economy, while warning that Iran’s constitution should be changed to create an easier business environment after sanctions are removed.