South Steam Pipeline via Turkey?

April 16th, 20146:11pmPosted In: Pipelines, Natural Gas, News By Country, South Stream Pipeline, Russia, Turkey

New possibilities have emerged for the South Stream pipeline with Turkey offering to consider passage through its territory.

Speaking to reporters Wednesday, Energy Minister Taner Yildiz commented that Turkey would consider granting access for the Russian gas pipeline if a formal request was presented.

“We are open to assessing any request for the line to pass through Turkey's territory," said Yildiz.

Russian officials including Gazprom deputy head Alexander Medvedev will be meeting next week in Ankara to discuss energy related issues including gas supply and pricing. 

"It is said that there could be such a demand. If there is a request, we will consider it," said Yildiz, due to hold talks with Alexander Medvedev, deputy head of Russian state-controlled Gazprom, in Ankara on Monday.

Potential scenarios could see South Stream shift its route from a crossing under the Black Sea with landfall in Bulgaria to an overland passage to northwest Turkey, providing supply to regions such as the Marmara region, which has high levels of gas demand.

Alternatively, the undersea leg of the pipeline could remain with gas then routed from Bulgaria to western Turkey, instead of to Italy.

The former-CEO of Italy’s Eni Spa, Paolo Scaroni, recently commented that the on-going crisis in Ukraine could come with some complications for the South Stream pipeline project.

According to Scaroni, the Crimea crisis could undermine the permitting process for the pipeline. Eni holds 20% of the company in charge of the offshore section. 

Italian gas demand peaked around in 2005 and has returned to the levels seen in 2000. The situation is dramatically different in Turkey, with gas demand more than tripling since 2000.

Turkey has already requested that Russia consider increasing the capacity Blue Stream that brings Russian gas via the Black Sea to central Turkey.  Turkey is seeking an increase of  3.5 billion cubic metres annually in addition to the current 16 billion cubic meters (bcm) per year.