Turkey Spurred on to Wean Itself Off Russian Gas
Turkey is expected to step up efforts to diversify its supplies of liquefied natural gas (LNGLF) (LNG) with the addition of new import terminals to lessen its reliance on gas from Russia, with floating terminals likely to be the speediest solution.
Russia is Turkey's top gas supplier but their growing estrangement over the Syrian conflict is souring trade relations and threatening to reshape commodity flows.
Russia imposed sanctions on some Turkish goods after Turkey shot down a Russian SU-24 bomber plane on Nov. 24, saying it had violated its airspace, while Russia says the plane never flew out of Syrian airspace.
Turkey currently receives Russian gas via the Blue Stream pipeline, along with Iranian piped supply as well as having two land-based import terminals. It has been considering additional terminals for several years but recent events has increased the impetus for this, sources said.
"They're looking at all options but there's nothing planned. The quickest solution to diversify supply is an FSRU (floating storage and regasification unit)," said a Turkish gas trader, adding that Turkish private sector players have government backing to explore potential additional LNG import terminals in light of recent tensions with Russia.
Earlier on Wednesday sources said Turkey was preparing to cut imports of liquefied petroleum gas (LPG) from Russia by a quarter next year.
Turkey's President Tayyip Erdogan flew to top LNG exporter Qatar this week for trade talks.
Norway's Hoegh LNG has been in discussions in recent months with two private sector gas companies in Turkey over potential floating storage and regasification units (FSRU), as the seaborne terminals are known, its chief executive said on the sidelines of the CWC World LNG Summit.
"The main driver of these two companies was to get access to gas from different producers. They plan to buy from the U.S," said Sveinung Stohle, chief executive of Hoegh.
"With this new situation maybe it will come back on the top of the agenda."
Turkey was already considered by FSRU suppliers a potential growth market for LNG imports.
"Do I think Turkey is an opportunity, absolutely I think Turkey is a great opportunity," said Rob Bryngelson, chief executive of U.S. gas shipping company Excelerate Energy.
(By Sarah McFarlane and Oleg Vukmanovic)
