Türkiye’s energy landscape has changed dramatically in the last several years due to the need to meet global decarbonization targets, improve energy security, and lessen reliance on imports.[1] Türkiye’s growing reliance on liquefied natural gas (LNG) is a major factor in this change, as shown by historic agreements with global energy giants like TotalEnergies, ExxonMobil, and Shell. These agreements allow Türkiye the freedom to obtain energy from numerous worldwide suppliers and support the country’s overall goal of energy diversification, which aims to reduce Türkiye’s reliance on pipeline gas, mainly from Russia and Iran.
Diversification of Energy Sources
Türkiye has made significant progress in diversifying its energy sources, emphasizing long-term contracts for LNG supplies to reduce reliance on pipeline imports. One of these contracts, which runs for ten years and guarantees 1.6 billion cubic meters (bcm) of LNG a year beginning in 2027, is with TotalEnergies. Starting that year, a comparable agreement with Shell ensures up to 4 bcm of LNG annually. Furthermore, Türkiye and ExxonMobil have an agreement in place for an annual delivery of 3.2 bcm of LNG.[2] These deals are especially significant because Türkiye is more dependent on reliable energy sources as several significant pipeline contracts with Iran and Russia approach expiration. Türkiye is improving its position as a regional energy actor and building a more robust energy framework by collaborating with a wide variety of LNG suppliers. By implementing this plan, Türkiye will be better equipped to manage risks such as supply interruptions and geopolitical unrest, guaranteeing a stable and flexible energy future for its people and economy.[3]
Türkiye’s FSRU Utilization
Türkiye has expanded its capacities through Floating Storage and Regasification Units (FSRUs), a major improvement made to its infrastructure for importing gas in response to the growing demand for LNG. The nation currently has five LNG import terminals, with two owned by private companies and three operated by state-owned Botaş. This increases the total yearly gas import capacity to about 75–80 bcm. This shows Türkiye’s potential to become a major energy re-exporter as it greatly outpaces its domestic consumption of about 50 bcm annually.[4]
Türkiye can manage its LNG imports with more flexibility thanks to the FSRUs. Together with Germany, Türkiye is ranked third in the world for FSRU utilization, with three FSRUs in operation, according to the International Gas Union’s 2023 World LNG Report. To maximize the distribution of energy, these facilities are positioned strategically around the country.[5] With a daily capacity of 28 million standard cubic meters (Sm³), the FSRU in Dörtyol, Hatay is home to Türkiye’s first Turkish-flagged FSRU ship, Ertuğrul Gazi, which has been in operation since 2018.
Comparable in capacity, the Saros terminal has been in operation since December 2022 and is crucial for serving the Marmara region, which includes Istanbul. The terminal has a significant capacity of 5.6 million tons per annum (mtpa), equivalent to 7.62 bcm per year (bcm/y).[6] Its 28 Sm³ of daily regasification capacity, which promotes system flexibility and potentially increases Türkiye’s energy supply security for Europe, further supports this capacity. Türkiye’s energy infrastructure benefits greatly from the strategic placement and capacity of the terminal on the Aegean coast, which improves the country’s ability to meet peak natural gas demand, especially during the winter months when consumption normally increases.[7] In addition, the Etki terminal in Izmir, which has been in service since 2016, has a storage capacity of 170,000 m³.[8]
Strategic Importance of FSRUs in Energy Security
Because they provide flexibility in LNG imports and storage, particularly during the months of high demand in winter, FSRUs are essential to Türkiye’s overall energy strategy. Due to its flexibility, Türkiye can increase its imports of LNG as needed; shipments can increase from one per month in the summer to as many as five or six in the winter. Türkiye may lessen its reliance on pipeline gas and guarantee a steadier supply by gaining access to LNG from numerous international suppliers. Additionally, by enabling LNG re-exports to Europe through the expansion of infrastructure, such as the Trans-Balkan pipeline, FSRUs support Türkiye’s objective of becoming a regional energy hub. Türkiye’s status as a major regional energy player is strengthened by its ability to quickly modify its import capacity to meet changing energy needs thanks to its quick deployment capability.[9]
Enhancing Import Capacity: The Role of the Ertuğrul Gazi FSRU
Through various strategies, the Ertuğrul Gazi FSRU significantly contributes to improving Türkiye’s energy security. The unit allows Türkiye to import and store large amounts of LNG, broadening its energy sources. Its storage capacity is 170,000 m³ of LNG or 110 million Sm³ of natural gas. One of its most notable qualities is its large capacity for regasification; with a daily capacity of 28 million Sm³, it is among the greatest in the world. This capability ensures an efficient supply of energy by enabling the quick conversion of LNG into natural gas for delivery to the national grid. The FSRU is ideally situated near the Dörtyol port in Hatay province, providing efficient service to Türkiye’s southern areas and quick response to demand variations.[10]
Additionally, by enabling Türkiye to import LNG from several suppliers and spot markets, the FSRU increases supply flexibility by considerably lowering reliance on pipeline gas. Additionally, the facility is built for seasonal flexibility, allowing it to ramp up operations during times of high demand. For example, it can handle up to five or six ships a month in the winter, compared to just one in the summer.[11]
The Ertuğrul Gazi FSRU significantly increased Türkiye’s total energy supply in its first year of operation by transferring almost 2.1 bcm of gas to the national grid. Because of its quick response time, it may be swiftly deployed to high-consumption areas, ensuring a steady supply of power. Furthermore, the FSRU uses ecologically friendly technology by minimizing its influence on the environment by using “Glycol Water” for regasification instead of seawater.[12] The Ertuğrul Gazi FSRU greatly improves Türkiye’s energy security by offering these crucial functions, which also increase storage capacity, import flexibility, and the potential to adapt quickly to changing energy demands.
Transition to Cleaner Energy
Despite seeming to run counter to Türkiye’s decarbonization objectives, the country’s new LNG deals are a necessary step toward a cleaner energy mix. When a country switches to renewable energy sources, natural gas—especially in liquefied form—is thought to act as a bridge fuel, assisting in the reduction of dependency on more carbon-intensive energy sources. Türkiye can lessen its reliance on coal and other high-emission fuels while maintaining a steady supply of energy by integrating LNG into its energy policy. This plan builds on Türkiye’s achievements in renewable energy, which witnessed a 50% growth in capacity in the five years since 2019 and is in line with the country’s aggressive climate roadmap.[13] LNG integration helps ensure Türkiye’s energy future is sustainable and balanced as it develops renewable infrastructure and lowers emissions through policy implementation.
Balancing Traditional and Renewable Sources
To meet rising demand and uphold its environmental obligations, Türkiye is pursuing a balanced approach to energy policy, investing in both conventional and renewable energy sources. Türkiye’s energy policy involves guaranteeing supply security (reliability), preserving affordability, achieving net-zero emissions, and reaching energy independence, according to Energy Minister Alparslan Bayraktar.[14] This all-encompassing approach, which complements investments in renewable energy projects like solar, wind, and hydroelectric power and improves energy security through diverse gas supplies, is centered on the recent LNG transactions.
Türkiye can close the gap between its short-term energy requirements and its long-term sustainability objectives by utilizing LNG as a transitional fuel. Additionally, the nation is pushing forward with renewable energy projects, with 80 gigawatts (GW) of hydroelectric, wind, and solar power initiatives planned for the next decade.[15] The country is aggressively striving toward this goal. The nation’s installed capacity is predicted to reach 190 GW by 2035, of which 60 GW will come from brand-new renewable energy facilities. Türkiye has 59.2 GW of renewable generating capacity as of 2023; hydropower contributes around 32 GW, wind contributes 11.8 GW, and solar contributes 11.3 GW. As part of its endeavor to achieve its long-term sustainability goals as well as its urgent energy demands, Türkiye is expanding its investment in clean energy.[16] By fostering innovation in green technology, fostering economic growth, and reducing reliance on imported fossil fuels, this strategy positions Türkiye as a regional leader in the energy transition.[17]
Enhancing Energy Security
Considering the changing global energy landscape, Türkiye’s long-term LNG supply agreements are an important step toward bolstering energy security. The significance of these agreements in safeguarding not only Türkiye’s energy supply but also meeting the wider region’s demand has been emphasized by Minister Bayraktar. By diversifying its resources and reducing its reliance on pipeline gas from Iran and Russia,[18] Türkiye is better able to adjust to changes in global demand and possible disruptions in supply. Its previous reliance on a small number of suppliers is lessened by these LNG deals, enhancing its energy independence and positioning it as a major actor in the dynamics of the regional energy market. Türkiye is putting itself in a position to spearhead energy cooperation initiatives with surrounding countries, promote market stability, and further environmental goals as it grows its LNG portfolio.[19]
Infrastructure Development
Türkiye is giving infrastructure development top priority to fulfill its goal of becoming a regional energy hub. This includes increasing its capacity to import and distribute LNG. To accommodate rising demand and guarantee effective operations, the nation has made investments in the building and renovation of cutting-edge facilities.[20] Türkiye’s position as a dependable energy supplier to neighboring markets is strengthened by these initiatives, which help increase Türkiye’s energy security. Türkiye’s ambition to further integrate into the European energy market includes ongoing negotiations with Bulgaria to improve transmission capacity along the common border. Türkiye is creating a robust network that meets its domestic energy demands and boosts its capacity to export LNG, securing its place in the world energy market by enhancing infrastructure and encouraging regional collaboration.[21]
Natural Gas Hub Plan
With important agreements like the 10-year LNG supply arrangement with TotalEnergies, which includes options for rerouting supplies to Europe and maybe Egypt, Türkiye is aggressively pursuing its objective of becoming a regional LNG hub. This deal is a component of a bigger plan to diversify Türkiye’s gas supply and lessen its dependency on pipeline imports from established vendors. As long-term contracts come to an end, Türkiye increases its negotiating power with current suppliers by securing additional LNG deals. To meet Southeast Europe’s demand for gas, Türkiye plans to establish a “Turkish Blend” of gases received from multiple providers, as highlighted by Minister Bayraktar.[22] Türkiye hopes to strengthen its position as a major energy actor in the area and improve its gas trading capabilities by utilizing its geographic advantage and investments in LNG infrastructure and storage.[23]
How will Türkiye’s LNG agreements impact its role in European energy markets?
Türkiye can benefit from re-export potential in the energy sector thanks to its expanding LNG production and significant infrastructural expenditures. Türkiye’s import capacity is more than its domestic needs, and the country is becoming a hub for LNG trading. Due to its capacity to obtain LNG from several suppliers, such as the U.S., Qatar, Oman, and Trinidad and Tobago, Türkiye is better equipped to meet the demands of the European market. Furthermore, the Trans-Balkan pipeline’s recent upgrading makes it easier to export gas to nations like Serbia, Bulgaria, Romania, and Hungary, thereby enhancing Türkiye’s position as a crucial hub for the distribution of energy in the area.[24] Türkiye’s improved infrastructure and geographic location make it well-positioned to contribute to the diversification of European nations’ supply pathways. By providing competitive alternatives to established suppliers, this policy not only increases Türkiye’s geopolitical prominence but also fortifies energy security and market resilience in European nations.[25]
As the area looks for gas alternatives to Russia during geopolitical tensions, Türkiye’s increasing prominence as a potential supplier promises to support European energy security. Türkiye’s important projects and growing LNG infrastructure provide a substitute supply route, reducing dependency on Russia. Europe needs to diversify to lessen its reliance on fossil fuels and to become more resilient to changes in the market and in the political system. Türkiye’s capacity to import LNG from various suppliers boosts competition in the European gas market, which eventually benefits customers by offering them more options and more stable prices. By doing this, Türkiye contributes significantly to the energy landscape of Europe and fortifies its own energy security.[26]
The future of Türkiye gas imports from Iran
Türkiye wants to establish itself as a regional energy hub by importing gas to fulfill a substantial amount of its demand by 2027, which will require increasing the amount of LNG it uses in its energy mix. Türkiye now imports 9.6 bcm of gas per year from Iran through pipelines; future capacity increases could boost quantities and provide Türkiye with additional quantities.[27] However, Türkiye’s energy strategy is focused on diversifying its gas supply sources and reducing reliance on pipeline gas from Iran rather than increasing imports from it. The country is actively pursuing LNG imports and domestic production to enhance its energy security. This is evidenced by recent developments such as the long-term LNG supply agreement with TotalEnergies for 1.6 bcm per year starting in 2027 and ongoing talks with ExxonMobil for a potential 10-year LNG deal of up to 2.5 million tons annually.[28]
Additionally, Türkiye will have leverage in renegotiating better terms for gas contracts with Iran thanks to these LNG deals. Türkiye is ramping up domestic gas production, especially from its Black Sea discoveries, to reduce dependence on imports. In 2023, gas output rose by 112.55%, reaching 807.28 million cubic meters, largely due to the Sakarya gas field in the Black Sea.[29] The goal is to deliver 7.5 bcm/y by 2026, covering around 15% of Türkiye’s 50 bcm yearly consumption. With reserves estimated at 710 bcm, the Sakarya field could supply up to 30% of the country’s gas needs when it reaches its peak production of 14.6 bcm/y within the next decade.[30] Türkiye’s position in the regional energy markets is cemented and its energy security is reinforced by this multipronged strategy.[31]
Challenges and Opportunities
Türkiye confronts several difficulties in striking a balance between its objectives for the energy transition and sustainable development, even as its LNG agreements enhance its strategic position in the world energy market. Navigating its energy ties is a vital problem, particularly with Russia given its continued nuclear partnership. Türkiye must carefully manage its relationships as it looks to become a major player in the European energy markets, as not doing so may put its energy goals at odds with those of Europe. Türkiye’s alignment with European energy norms may become more complex if it chooses to diversify its energy sources while fortifying its connections with Russia.[32]
Türkiye must also consider the changing European legislative frameworks, such as the European Green Deal and the REPowerEU plan, which support the use of renewable energy sources, energy independence, and lower greenhouse gas (GHG) emissions. The energy landscape is becoming more competitive because of these EU initiatives, and Türkiye will need to adjust to the new rules and specifications to stay a valuable partner. Türkiye’s ambitions in the European market could be hampered by a failure to comply with EU laws, which would require tactical changes to its energy policies.[33]
Despite advancements made possible by LNG deals, Türkiye’s energy transition is beset with serious challenges, chief among them being its reliance on coal. With the third-largest coal pipeline in the world located there, Türkiye runs the risk of being stuck in a carbon-heavy future. Türkiye needs to phase out coal by 2030 to reach its net-zero emissions objective by 2053. However, current approaches run the risk of increasing emissions, which runs counter to the objectives of the Paris Climate Agreement.[34] Türkiye has made progress toward renewable energy, but it has not fully realized the potential of its onshore wind and solar resources. For Türkiye to become a major player in the European energy market and pursue a sustainable energy future, it will be imperative to address these concerns.[35]
Conclusion
The LNG supply agreement with TotalEnergies, Exxon Mobil, and Shell serves as strategic moves for Türkiye, aimed at enhancing energy security and broadening supply sources, particularly by reducing dependence on pipeline gas from Russia and Iran. These deals improve Türkiye’s capacity to source energy flexibly, allowing it to better adapt to disruptions in the global energy landscape.
While LNG aids Türkiye in its shift toward cleaner energy, it cannot serve as a long-term solution for meeting its climate goals. To fully achieve these objectives, Türkiye must concentrate on significantly boosting its renewable energy capacity, particularly in solar, wind, and geothermal sectors, where it possesses considerable potential. One of Türkiye’s major challenges is its continued reliance on coal, which remains a dominant energy source and is a significant contributor to carbon emissions. Without a well-defined and actionable strategy to phase out coal, Türkiye’s decarbonization initiatives could be jeopardized. Reducing coal consumption is essential for progressing toward a cleaner energy future.
Additionally, Türkiye must set more rigorous emissions reduction targets to align itself with global climate agreements, such as the Paris Agreement. This involves establishing more ambitious goals within its Nationally Determined Contributions (NDCs) and implementing policies designed to effectively reduce emissions. These actions are crucial for Türkiye to evolve from relying on temporary solutions like LNG to embracing a sustainable, low-carbon energy future. Furthermore, Türkiye should focus on improving energy efficiency across all sectors. By investing in energy-saving technologies and promoting energy-efficient practices, the country can decrease overall energy consumption while bolstering its renewable energy initiatives. This combined strategy of enhancing renewable energy sources and improving energy efficiency will not only reinforce Türkiye’s energy security but also play a significant role in fulfilling its climate commitments. Ultimately, a comprehensive energy strategy that integrates LNG with a robust expansion of renewable energy and a focus on energy efficiency is vital for Türkiye’s sustainable energy future.
[1] Francesco Siccardi, “Understanding the Energy Drivers of Turkey’s Foreign Policy,” Carnegie, February 28, 2024, https://carnegieendowment.org/research/2024/02/understanding-the-energy-drivers-of-turkeys-foreign-policy?lang=en¢er=Europe.
[2] Pramod Kumar, “Turkey’s Botas signs 10-year LNG deal with TotalEnergies,” AGBI, September 19, 2024, https://www.agbi.com/oil-and-gas/2024/09/turkeys-botas-signs-10-year-lng-deal-with-totalenergies/.
[3] TotalEnergies Signs 10-Year LNG Supply Deal with Turkey’s Botas, Offshore Engineer, September 18, 2024, https://www.oedigital.com/news/517172-totalenergies-signs-10-year-lng-supply-deal-with-turkey-s-botas.
[4] Zeynep Beyza Kilic and Firdevs Yuksel, “Türkiye among select countries with 3 strategic FSRU facilities,” Anadolu Agency, November 7, 2023, https://www.aa.com.tr/en/economy/turkiye-among-select-countries-with-3-strategic-fsru-facilities/3046250.
[5] “Floating Storage and Regasification Unit (FSRU) – Dörtyol,” BOTAS, https://www.botas.gov.tr/pages/floating-storage-and-regasification-unit-fsru-dortyol/372.
[6] “Gulf of Saros FSRU,” Global Energy Monitor Wiki, https://www.gem.wiki/Gulf_of_Saros_FSRU.
[7] “Türkiye stands among select nations with 3 strategic FSRU facilities,” Daily Sabah, November 7, 2023, https://www.dailysabah.com/business/energy/turkiye-stands-among-select-nations-with-3-strategic-fsru-facilities.
[8] “Etki FSRU,” Global Energy Monitor Wiki, https://www.gem.wiki/Etki_FSRU.
[9] “Turkiye’s Growing Gas Demand Depends On Import Reliance,” BMI, March 20, 2024, https://www.fitchsolutions.com/bmi/oil-gas/turkiyes-growing-gas-demand-depends-import-reliance-20-03-2024.
[10] “Floating Storage and Regasification Unit (FSRU) – Dörtyol.”
[11] “Türkiye stands among select nations with 3 strategic FSRU facilities.”
[12] “A year on, Turkey’s first FSRU transfers 2.1 bcm of gas to local system,” Daily Sabah, June 24, 2022, https://www.dailysabah.com/business/energy/a-year-on-turkeys-first-fsru-transfers-21-bcm-of-gas-to-local-system.
[13] “Turkey’s success in renewables is helping diversify its energy mix and increase its energy security,” IEA, March 11, 2021, https://www.iea.org/news/turkey-s-success-in-renewables-is-helping-diversify-its-energy-mix-and-increase-its-energy-security.
[14] “Türkiye to continue to pursue resource diversification strategy: Energy Minister,” Hurriyet Daily News, April 26, 2024, https://www.hurriyetdailynews.com/turkiye-to-continue-to-pursue-resource-diversification-strategy-energy-minister-192840.
[15] “Turkey prepares USD 100 billion energy transition program, USD 10 billion for grid,” Balkan Green Energy News, December 8, 2023, https://balkangreenenergynews.com/turkey-prepares-usd-100-billion-energy-transition-program-usd-10-billion-for-grid/.
[16] “Renewables had 99.5% share in new capacity in 2023 in Turkey,” Balkan Green Energy News, January 23, 2024, https://balkangreenenergynews.com/renewables-had-99-5-share-in-new-capacity-in-2023-in-turkey/.
[17] “Türkiye to continue to pursue resource diversification strategy: Energy Minister.”
[18] “Turkey seals LNG deal with France’s TotalEnergies,” Turkish Minute, September 18, 2024, https://www.turkishminute.com/2024/09/18/turkey-seal-lng-deal-w-france-totalenergies/.
[19] Suyash Pande, “Shell LNG deal with Turkey’s Botas priced at under 11% to 11.2% formula to crude oil: sources,” S&P Global, September 5, 2024, https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/lng/090524-shell-lng-deal-with-turkeys-botas-priced-at-under-11-to-112-formula-to-crude-oil-sources.
[20] “Weighing up Turkey’s gas hub aspirations [Global Gas Perspectives],” Natural Gas World, September 12, 2024, https://www.naturalgasworld.com/weighing-up-turkeys-gas-hub-aspirations-global-gas-perspectives-118067.
[21] Ibid.
[22] Turkish Energy Minister Alparslan Bayraktar Speaks at Gastech 2024, https://enerji.gov.tr/news-detail?id=21362.
[23] Firat Kozok, “Turkey Boosts Gas Hub Aim With TotalEnergies LNG Deal,” Bloomberg, September 18, 2024, https://www.bloomberg.com/news/articles/2024-09-18/turkey-boosts-gas-hub-aim-with-10-year-totalenergies-supply-deal.
[24] David O’Byrne, “Turkey eyes greater role as gas re-exporter to Europe: Bayraktar,” S&P Global, September 23, 2024, https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/natural-gas/092324-turkey-eyes-greater-role-as-gas-re-exporter-to-europe-bayraktar.
[25] Ibid.
[26] Eser Özdil, “Part 4. Turkey’s geopolitical role in the Black Sea and European energy security: From pipelines to liquefied natural gas,” Atlantic Council, September 13, 2024, https://www.atlanticcouncil.org/in-depth-research-reports/report/part-4-turkeys-geopolitical-role-in-the-black-sea-and-european-energy-security-from-pipelines-to-liquefied-natural-gas/.
[27] David O’Byrne, “Turkmenistan, Turkey talk gas transit, but Iran factor muddies picture,” eurasianet, January 5, 2024, https://eurasianet.org/turkmenistan-turkey-talk-gas-transit-but-iran-factor-muddies-picture#:~:text=Turkey%20already%20imports%209.6%20billion,pipeline%20to%20the%20Turkish%20border.
[28] “Turkey looks for Exxon LNG deal to replace Russia,” AGBI, April 30, 2024, https://www.agbi.com/oil-and-gas/2024/04/turkey-looks-for-exxon-lng-deal-to-replace-russia/.
[29] “Türkiye’s gas output leaps 113% as Black Sea reserve boosts output,” Daily Sabah, June 18, 2024, https://www.dailysabah.com/business/energy/turkiyes-gas-output-leaps-113-as-black-sea-reserve-boosts-output.
[30] “Türkiye’s gas production up 112% annually as Black Sea discovery boosts output,” Azer News, June 17, 2024, https://www.azernews.az/region/227504.html.
[31] Adam Michalski, “Centre for Eastern Studies (OSW)Strength in LNG? The gas market in Turkey,” Centre for Eastern Studies, October 1, 2024, https://www.osw.waw.pl/en/publikacje/analyses/2024-10-01/strength-lng-gas-market-turkey.
[32] Eser Özdil, “Part 4. Turkey’s geopolitical role in the Black Sea and European energy security.”
[33] Ibid.
[34] “Türkiye,” Climate Action Tracker, https://climateactiontracker.org/countries/turkey/.
[35] “Turkey’s success in renewables is helping diversify its energy mix and increase its energy security.”
