‘Turkish Stream’ will lower natural gas prices in Turkey

The Contract Structure and Pricing Director of Gazprom, Sergei Komlev, speaking to Anadolu Agency (AA) during a Boğaziçi University Energy Club meeting answered questions from reporters on the new pipeline project contemplated between Russia and Turkey. Komlev said the partnership will enable Turkey to purchase natural gas at lower prices, but underlined that they are expecting Turkey to submit a reasonable discount offer.

"This is such a realizable project, according to our research and the work we have performed up to today," said Komlev. On whether these pipelines will be expansive or not, Komlev noted that the cancelled South Stream pipeline was more costly than this project, as hundreds of kilometers of the South Stream pipelines would have passed over land, whereas the new pipeline, the Turkish Stream Project, will be laid mostly under the sea. "Offshore pipelines always cost less than onshore pipelines, and only a very small portion of this new line crosses the land and that is the part that will pass through the Thrace region. Therefore, less financing will be required for this pipeline," said Komlev. He further added that certain works have been completed in the Black Sea for the South Stream Natural Gas Pipeline Project, and now they will only have to work on the entry of the new pipeline into Turkey, since the infrastructure prepared for the Russian sector will also meet the demands of the new pipeline.

Komlev also underlined that Turkey is a reliable partner for Russia and that Russian President Vladimir Putin hinted at this project back in May, adding, "Putin had stated that if the European Union continues to impede the South Stream Project, Russia might consider new pipelines in Turkey."

On whether the partnership in the Turkish Stream Natural Gas Pipeline Project will mean a discount in natural gas sold to Turkey, Komlev stated that they have already promised Turkey a certain discount, but Turkey should not forget that gas producers also have to look out for their own interests and demand reasonable discounts. "There are regulated prices in Turkey, and Turkey is negotiating with us to obtain prices close to these levels. If we are to talk about liberalization, the regulation of these natural gas prices should be reevaluated," said Komlev. Turkish Minister of Energy and Natural Resources Taner Yıldız announced on Wednesday that while they have held meetings with Gazprom, there are two more meetings scheduled, and prices are expected to be determined in the New Year.