30 Nisan 2013 Salı

Turkey to say in days who will build 2nd nuclear plant


Turkey’s energy minister said Ankara will announce by the weekend which country will construct its second nuclear power station, a project expected to cost around $22 billion.

Turkey, likely to overtake Britain as Europe’s third-biggest electricity consumer within ten years, plans to build several nuclear plants over the next decade to reduce its dependence on imported oil and gas.

“We are about to finalise the agreement for construction of the second power plant. China and Japan are the front runners,” Taner Yıldız told reporters today.

Turkey is expected to choose a Japanese consortium of Mitsubishi Heavy Industries and Itochu , with France’s GDF Suez, to build the plant which is seen having a capacity of around 4,500-5,000 megawatts (MW), according to Turkish government sources.

Turkish media reported in March that the deal will be signed by Turkish and Japanese officials in early May to construct four pressurized water nuclear reactors with a combined capacity of about 4.5 gigawatts at Sinop on theBlack Sea. Construction is to start in 2017.

Turkey signed a deal with Russia’s Rosatom in 2010 to build its first nuclear power station. Rosatom will start construction in mid-2015 and it expects electricity production to start in 2019, its deputy general manager said in February.

29 Nisan 2013 Pazartesi

Too early for shale gas boom in Turkey: chief economist

World Bulletin

It would be a big surprise if Turkey experienced a significant turnaround in shale gas production, similar to that in the US, in the short term, the International Energy Agency's (IEA) chief economist said at a conference on Friday in İstanbul, adding that it is too early to say whether shale gas production will be financially viable for the country.

Speaking on the sidelines of the 19th Energy and Environment Fair and Conference (ICCI), Fatih Birol said Turkey has “golden opportunities to be a crucial player in global energy markets within the next five years.”
“The issue of shale gas production is very new in Turkey. There are serious studies in this regard; however, we have not yet learned whether this type of unconventional energy will be competitive enough in Turkey,” Birol explained.

The IEA official added that despite early feasibility studies, it is not still clear if the cost of shale gas extraction will be cheaper when compared to simply importing natural gas from suppliers in the region. “We would welcome a US-like shale gas revolution in Turkey in the short term; this, however, would be a big surprise for us,” he added.

Excitement over the prospect of trillions of cubic meters of shale gas in Turkey has kept the country's agenda busy in recent years as these estimates mean that Turkey, which is almost completely dependent on foreign countries for fuel resources, could finally be energy independent.

The Dark Side of Energy Independence

The New York Times                Benjamin Alter and Edward Fishman      

JUST as the world was writing off America as a declining power, the country now finds itself on the cusp of realizing one of its longstanding goals: energy independence.

A wave of new technologies has made it possible to extract oil and gas from shale rock formations, and the results have been astonishing. By some estimates, the United States is on track to overtake Saudi Arabia as the world’s largest oil producer as early as 2017, start exporting more oil and gas than it imports by 2025, and achieve full energy self-sufficiency by 2030.

American politicians in both parties have long dreamed of energy independence — not only for its potential economic benefits, but also because it could free the United States from the vicissitudes of the outside world.

Last March, President Obama said that new energy sources and technologies would make America “less dependent on what’s going on in the Middle East.” The Romney campaign, meanwhile, argued that energy independence would mean that “the nation’s security is no longer beholden to unstable but oil-rich regions halfway around the world.”

But that is a fantasy. While the latest energy revolution will be a boon to America’s economy, it will in no way allow the United States to turn its back on the rest of the world. 

27 Nisan 2013 Cumartesi

TAP Countries Give Tripartite Support

Natural Gas Europe

The governments of Albania, Greece and Italy have created a special committee to coordinate support for the Trans-Adriatic Pipeline (TAP), one of two major contenders for the contract to convey gas from the Shah Deniz 2 field off Azerbaijan.

External Affairs Director for TAP, Michael Hoffmann, said the support was a major vote of confidence in his consortium, which is led by Norwegian major Statoil.

TAP is included in the so-called Southern Corridor, a planned network of pipelines meant to offer alternatives to Russian gas for Europe.

Albania, Greece and Italy are all transit countries for TAP. When the gas supplies arrive in Italy, they will then be transported on to a range of customer countries, according to the plan.

TAP is up against the ambitious Nabucco West pipeline, which is backed by other European countries. Also on Wednesday, the Nabucco website recorded a call by Austria, Bulgaria, Hungary and Romania to support his alternative in the Shah Deniz decision.

On Monday the New York Times reported that Hungarian prime minister Mark Orban had said that MOL, his contry's participant in Nabucco West, wanted to withdraw from the project.

A BP-led consortium operating Shah Deniz is due to decide on the successful candidate by June.

Source: http://www.naturalgaseurope.com/tap-countries-give-tripartite-support

26 Nisan 2013 Cuma

Japan, France set to win Turkish nuclear plant deal


TOKYO — A consortium of Japan's Mitsubishi Heavy Industries and France's Areva are on track to win a deal to build a $20 billion nuclear power station in Turkey, a report said on Wednesday.

The top-selling Yomiuri Shimbun said Japanese Prime Minister Shinzo would likely sign the deal with his Turkish counterpart Recep Tayyip Erdogan during a visit to Turkey next week as part of a four-nation trip that ends on May 4.

A Mitsubishi Heavy spokesman declined comment on the Yomiuri report Wednesday, while an official in the Japanese trade ministry's nuclear energy policy division was not immediately available to comment.

Japan is increasingly looking abroad to grow its nuclear power business after demand fell away at home in the wake of the Fukushima atomic crisis two years ago.

An earlier report said the Turkish project would see four pressurised water reactors with a combined output of 4.5 million kilowatts built on the Black Sea coast.

Construction of the plant is slated to begin in 2017, with the first reactor coming online by 2023, Japan's leading Nikkei business daily has reported.

Turkey's Energy Minister Taner Yildiz said this month it was too early to declare a winner to build the project, amid reports the Franco-Japanese group had clinched it. Yildiz added that "we are currently holding talks with China and Japan".

"I can say Japan's claims are premature and the race is still continuing," he said in a televised interview.

24 Nisan 2013 Çarşamba

Shale gas tempts cash-strapped Europe

Paul Ames     GlobalPost.com

It's been more than 20 years since the last coal was dug out of the ground by the once-thriving mining communities of Belgium's Campine region.

Now there's hope of new riches beneath the area's sandy heathland.

The Campine is one of dozens of regions across Europe believed to be sitting on significant reserves of shale gas — the underground fuel that has revolutionized energy supply in the United States over the past decade.

"The potential in Europe could be huge," says Professor Richard Davies, a specialist at Britain's Durham University and advisor to the industry. "We've got all the right sort of rocks."

Shale gas now accounts for more than 20 percent of US natural gas production, up from barely 1 percent in 2000. By the 2030s, it's share is expected to be over 50 percent.

The United States is on course to become self-reliant in gas. Its heating bills are already four times lower than European levels.

Now prospectors are sharpening their drills in Europe and some governments are hoping for a US-style shale bonanza.

There are estimates that Britain could be sitting on enough reserves to meet its gas needs up to the end of the century.

23 Nisan 2013 Salı

UAE to up oil output capacity

Arab News

The UAE is seeking to increase its production capacity to 3.5 million barrels per day of crude oil to contribute to the stability of global markets, UAE Energy Minister Suhail Al-Mazrouei said.

OPEC member UAE currently pumps about 2.6 million barrels per day. The country is the fifth largest oil producing country in the team, behind Saudi Arabia, Iraq, Kuwait and Iran.

Al-Mazrouei said the rise would contribute to maintaining stability of global oil markets, but he did not disclose when they are going to increase the production.

"The recent events have proven that focusing on the security of energy is necessary in order to address natural disasters and geopolitical tensions as well as other unanticipated situations, which occur periodically in the world. That’s why the UAE undertook to construct an oil pipeline connecting Habshan-Fujairah to guarantee crude oil supplied to world market," he pointed out.

He was speaking at the opening session of the 21st Annual Middle East Petroleum and Gas conference, which began yesterday in Abu Dhabi.

Exports via Habshan-Fujairah route would allow the Gulf state to bypass the strategically vital Strait of Hormuz, which Iran has repeatedly threatened to close.

The minister added that some scenario stipulates that the global oil demand may increase by one million barrels a day until it reaches 105 million barrels a day by 2030, amid economic expansion in Asia and South America.

Gazprom has plans for Egypt's natural gas crisis


The Egyptian government has asked Russia for help with exporting natural gas to the European market, Russian Energy Minister Alexander Novak said.

Novak said Russian energy company Gazprom was considering a swap plan so Egypt could meet contractual obligations.

"Egypt has asked us to help make swap gas shipments ... under Egypt's agreements with Europe," he was quoted by state-owned news agency RIA Novosti as saying.

Russia is a leading natural gas exporter and producer. Europe gets about 20 percent of its natural gas imports from Russia, of which the majority travels through Ukrainian transit networks.

Egypt would keep some natural gas designated for European markets and Gazprom would make up the difference. No indication of volume was given.

Egyptian President Mohamed Morsi last month said he was interested in exploring a natural gas relationship with Russia.

Interview with Dr. Charles Ellinas and Mr. Solon Kassinis, Cyprus National Hydrocarbons Company (KRETYK)

Karen Ayat*       Natural Gas Europe

Natural Gas Europe was pleased to have an opportunity to interview Dr. Charles Ellinas, Chairman of the Cyprus National Hydrocarbons Company (KRETYK) and Mr. Solon Kassinis, Vice President of KRETYK at the 2nd Annual Cypriot-Greek Oil & Gas 2013 Summit” organized by IRN in the southern coastal town of Limassol

How mighty is Aphrodite?

SK: Aphrodite'’s proven reserves are estimated at 7tcf. We are planning to have another verification well starting in June  We expect to find 10 tcf at least.

CE: There is a lot of gas already proven and we are certain there is a lot more to be discovered in the 6 blocks already awarded, probably 4 to 5 times as much as Aphrodite. 

How will future oil and gas production, once discoveries are confirmed, contribute in enhancing Cyprus'’ economy and reducing its energy bill? 

SK: Within the 13 blocks in Cyprus’ EEZ, we do envisage to have around 60 tcf. We rely on this gas given that Cyprus’ economy is now in a very bad shape.

CE: We expect that Cyprus will start construction in 2016 creating thousands of jobs as a result. The services and supplies industries will benefit as well as subcontractors. A liquefied natural gas terminal in Vassilikos will be ready to deliver natural gas to the Cypriot market by the end of 2018 reducing electricity prices by at least 50% (the price for electricity is very high in Cyprus), whereas by the end of 2019 Cyprus will be in a position to export liquefied natural gas. By 2025 Cyprus and the Levantine Basin will be able to produce 25 million tones of natural gas per year and cover 50% of the EU’s additional energy needs.

Interview with Dr. Theodore Tsakiris, Assistant Professor, Geopolitics of Hydrocarbons, University of Nicosia, Cyprus

Karen Ayat*       Natural Gas Europe

Interview with Dr. Theodore Tsakiris, Assistant Professor, Geopolitics of Hydrocarbons, University of Nicosia, Cyprus 

Natural Gas Europe was pleased to have an opportunity to interview Dr. Theodore Tsakiris, Assistant Professor, Geopolitics of Hydrocarbons, University of Nicosia, Cyprus, at the 2nd Annual Cypriot-Greek Oil & Gas 2013 Summit” organized by IRN in the southern coastal town of Limassol.
How realistic is the hoped-for resources boom in Cyprus?

What we have known since December 2011 is that Aphrodite contains a sizable volume of high quality natural gas between 5-9 tcf with a gross mean average of 7 tcf (trillion cubic feet). The appraisal or confirmatory drilling on Aphrodite, which will be completed by September 2013, will give us an accurate estimate of the exact size of the field, its extractability and its quality. There is a 50% probability that the size of the field is at 7 tcf, a 25% probability that it will be at 5 tcf and another 25% probability that it will be at 9 tcf.  In addition to Aphrodite Noble has recently announced plans to explore a second area within Block 12 were seismic data analysis indicates the existence of another promising play capable of containing 3-5 tcf. Exploration drilling will begin in this second Block 12 play over the first four months of 2014. The greatest challenge of course is ahead and relates to the results of the exploration programme set out for 2014-2016 by ENI/Kogas and Total. Cypriot authorities appear confident that the exploratory programme will result in discoveries even greater than Aphrodite.

How much gas is needed to justify the commercial viability of the Vassilikos LNG plant?

We need around 8-9tcf to justify the lengthy and costly project of building the Vassilikos LNG plant. If the appraisal drilling confirms that Aphrodite contains 7tcf it would also be marginally viable to proceed with the LNG terminal without the need for additional discoveries.

High quality oil in KRG holds ‘Turkish interest’


Since Turkish firms have discovered high quality oil in northern Iraq, Turkey cannot remain indifferent to the oil and natural gas resources, says an executive of Genel Energy that has discovered oil in the Chia Surkh.

Turkey cannot remain indifferent to the oil and natural gas resources in northeastern Iraq, an executive of Genel Energy has said, as Genel Energy and Petoil have discovered quite high quality oil in the Chia Surkh site.

“We have got to know the region’s geological structure very well. The reserves are good. And there could be even more reserves far beyond those announced until now, both oil and natural gas,” Genel Energy’s Head of Government and Public Affairs Pars Kutay said. According to Kutay, these reserves are quite above the levels which Turkey needs. “We believe that for an energy hungry country which has limited energy resources, like Turkey, it does not seem possible to be indifferent to such huge sources just 150-200 km away from its borders” Kutay added.

AGRI LNG: Potential for Project High if European Demand Remains Firm

Natural Gas Europe

The Interconnector Azerbaijan-Georgia-Romania-Hungary (AGRI) pipeline project is still possible, and could provide a stimulus for “east Caspian countries” to produce more gas, according to energy specialist Liana Jervalidze.

AGRI, a proposed source of liquid national gas (LNG) to Europe, could be an auxiliary to the major gas pipelines once they come on line in 2018, she said.

“We don’t see now immediately chances for this project to be realized but in ten years time when Shah Deniz Two and TANAP will be implemented and addition volumes of gas will be available in Azerbaijan from other projects…maybe there will be room left for LNG as part of Azerbaijan energy diversity strategy,” she said during the 12th Georgian International Oil, Gas, Infrastructure & Energy Conference in Tbilisi on March 26.
Jervalidze, a professor at Ilia State University in Tbilisi and Analyst on Geopolitics of Energy, outlined the potential – and the challenges – for the AGRI project during the conference.

AGRI, a joint project between ROMGAZ, Georgian Oil and Gas Corporation, SOCAR, and Hungry’s MVM, could help the European Union met their 2050 goals to diversify types and sources of energy, Jervalidze noted.

If put on line, AGRI would have the potential to bring between 2 bcm and 8 bcm to Europe.

18 Nisan 2013 Perşembe

In the pipeline: an Israeli-Turkish reconciliation

Daniel Dombey       Finacial Times

An energy and diplomacy deal that would reshape the map of the eastern Mediterranean might be proceeding faster than many people think.

It is just a few weeks since, in a bid to revive frozen diplomatic ties, Israel apologised to Turkey for a deadly raid that left nine Turkish citizens dead. The process was still sufficiently shaky for US Secretary of State John Kerry to come to Istanbul last weekend to chivvy both sides to go all the way and exchange ambassadors.

There are plenty of potential slips on the way ahead: compensation has to be agreed; the fate of Turkish court cases against retired Israeli commanders has to be decided (at present, they are going ahead); and Ankara still has to pronounce itself satisfied with the lifting of restrictions on civilian goods to Gaza (relevant, because the flotilla stormed by Israeli Defence Forces in 2010 was seeking to break the Gaza blockade).

But it is becoming increasingly apparent that both governments are actively interested in sealing the tentative rapprochement with a deal under which gas-rich Israel would supply energy-hungry Turkey. Moreover, such considerations probably played a part in producing the reconciliation in the first place.

Israel eyes gas exports to neighbours

John Reed   Financial Times

A leading investor in Israel’s natural gas sector said initial talks were under way on exporting some of the country’s abundant offshore reserves to Turkey, Jordan, Egypt, and a proposed power plant in the West Bank.

Yossi Abu, chief executive of Delek Drilling, said the sector was poised to take part in a “new geopolitical opportunity” and was looking at possibilities to export gas via pipelines from offshore fields such as the big, unexploited Leviathan reserve to Israel’s regional neighbours and possibly – via Turkey – to Europe.
“There is a significant commercial basis to supply gas from Leviathan and other discoveries offshore Israel to Turkey, Jordan, the Palestinian Authority, and even Egypt,” Mr Abu told the Financial Times in an interview.

He added: “We have discussions – I cannot give you names – with potential customers in our region.”

Mr Abu’s remarks add weight to those from Israeli, Turkish and other government and private-sector figures recently, suggesting that talks on regional gas projects that would re-shape the Middle Eastern energy map are advancing quickly.

Israel apologised to Turkey last month for a fatal 2010 storming of a boat off Gaza, and the political rapprochement has raised the prospect of a thaw in trading relations between two of the Middle East’s biggest economies.

“We believe that there is a real opportunity to supply gas to the Turkish market, and maybe through the Turkish market to the European market,” Mr Abu said. “Also, there’s a real opportunity to supply gas to Jordan.”

12 Nisan 2013 Cuma

Peace to rise Turkey’s rating, says Moody’s


Ratings agency Moody’s said yesterday that Turkey’s progress towards peace with Kurdish militants was good for its credit rating, which it currently has just below investment grade.

“The prospect of peace promises to boost investor confidence and improve southeastern Turkey’s attractiveness as a destination for foreign direct investment,” Moody’s said.

Moody’s, which rates Turkey at Ba1 with a positive outlook, said the government’s agreement to form a parliamentary investigative commission to evaluate the process was a “visible and credit-positive step” in its progress toward peace.

“The conflict in the country’s southeast has been a longstanding source of political uncertainty constraining Turkey’s creditworthiness,” Moody’s said in its Credit Outlook publication.

The proposed establishment of a parliamentary commission was the strongest signals to date that peace talks were building momentum, it said.

In January, Moody’s said Turkey needed to improve its resilience to external shocks by narrowing its current account deficit or boosting foreign reserves.

Israel wants to carry Israeli gas to Turkey

Sevil Küçükkoşum         Hurriyet Daily News

Israel sees ‘Med-Streams’ in service of regional diplomacy

Building a pipeline that will carry Israeli gas to Turkey would enhance political normalization between two countries, Israeli envoy says, contrary to Turkish efforts to separate two processes

Transferring Israeli gas through Turkey to the international market is profitable for both Turkey and Israel and cooperation in the energy field could pave the way for resolving regional problems, a senior diplomat from the Jewish state said, as he apparently referred to probable normalization of bilateral relations between Turkey and Israel with the help of such cooperation at a bilateral level.

“We should start thinking at least about a set of Med-Streams, a set of pipelines and LNG that will enable us to exploit not only oil and gas, but also to create another political environment,” Ambassador Michael Lotem, special envoy for energy of the Israeli Foreign Ministry, said yesterday, referring to prospects of building of a pipeline from Israel to Turkey.

“Can we use energy; can we use gas, beyond the commercial value of it, in the service of politics, in the service of diplomacy?” Lotem asked in a speech delivered at the second and last day of the 12th Turkish International Oil & Gas Conference (TUROGE).

Noble Energy considers pipeline from Israel to Turkey


Texas-based Noble Energy will double in size in the next five years, with a big boost coming from natural gas production in the eastern Mediterranean, its chief executive said on Thursday.

"We expect to double in size over the next five years. Double in size in terms of production, double in size in cash flow, double in size in terms of reserves," CEO Charles Davidson told reporters during a visit to Israel.

Noble is leading a number of consortia drilling for and producing gas off the Israeli and Cypriot shores, and it has already discovered an estimated 35 trillion cubic feet (tcf) of reserves over the past few years.

Israel's Tamar field, discovered by Noble in 2009, holds an estimated 10 tcf. It went online on March 30 and can meet the country's gas needs for decades.

The much larger Leviathan field, set to begin production around 2016, is mostly slated for exports.
The discoveries were a welcome surprise in Israel, which has relied heavily on energy imports. Analysts have said the deposits are ideally situated to serve both Europe and Asia.

Nobel, which had a 2012 market capitalisation of $17.6 billion, forecasts end-2013 total production to be 300 thousand barrels of oil equivalent per day (MBoe/d).

Turkish Genel Energy Makes Oil Find in Kurdistan

Stanley Reed       The New York Times

LONDON — Genel Energy, the oil exploration company headed by Tony Hayward, the former chief executive of BP, announced Wednesday that it had made a significant oil find in Kurdistan.

Genel said its first well at Chia Surkh was producing almost 12,000 barrels of oil and 15 million cubic feet, or 435,000 cubic meters, of natural gas per day. “The reservoir is delivering at very high rates,” Mr. Hayward, the chief executive, said in an interview. 

He said that before the company started drilling, third-party estimates indicated that there could be about 300 million barrels of oil in the field. If so, that would be a major addition to Genel’s proven and probable reserves of about 445 million barrels. 

Genel holds 60 percent of the license area, which is in the extreme south of the Kurdish region of Iraq. The company’s stock price closed 6.4 percent higher in London on Wednesday. 

Genel is the largest producer in Kurdistan, an autonomous part of Iraq that has struck exploration deals with Chevron and Exxon Mobil in recent years. 

11 Nisan 2013 Perşembe

Exploring Potential Export Markets for Israeli Gas

Karen Ayat          Natural Gas Europe

Start of production at Tamar
Natural gas began flowing from the Tamar field off Israel's Mediterranean shores on Saturday 30 March 2013 producing 300 million cubic feet per day. When combined with the existing Mari-B volumes of 200 million cubic feet per day, the current daily sales are nearly 500 million cubic feet per day and expected to reach 700 million by the end of 2013. The Tamar field was discovered by Noble Energy in 2009 and was the largest deepwater natural gas discovery in the world in 2009 estimated at the time to contain 9 tcf of gas. Noble made a new estimation upping the gross resource estimate of Tamar to 10 trillion cubic feet (Tcf) as a result of development drilling and continued reservoir analysis and modeling. The updated estimate was confirmed by an independent assessment conducted by Netherland, Sewell & Associates, Inc. 

Previously discovered Mari-B
Mari-B was the first offshore natural gas field in the State of Israel discovered by Noble in March 2000. Noble started gas production from the Mari-B field in 2003. Despite its relatively small size (containing around 1 tcf of gas), the Mari-B field was not only a momentary relief for Israel but played a tremendous role in enabling Israel to shift from heavy fuel oils and coals to gas for its electricity production. Soon after, Israel began importing Egyptian Gas to supplement its local Mari-B gas and meet domestic demand. By the end of 2010, Israel relied on gas for around 40 per cent of its electricity supplied almost equally by its own Mari-B field and Egypt. 

Black Sea Region and Natural Gas Prospects

Natural Gas Europe

The recent international Black Sea Oil & Gas Forum held in Bulgaria highlighted culminations surrounding natural gas trade and investments in the region, which are gaining strong pace.

The president of the Bulgarian energy regulatory authority, Mrs. Evgenia Haritonova, pointed out that Bulgaria's immediate target is to increase the production of domestic natural gas while at the same time diversifying its import sources, based on the current pipeline projects, such as the Southern Corridor and the interconnectors with its neighbors - Greece, Serbia and Romania, which will be finalized within the next 18 months. Further she added that the Bulgarian government had already signed with an energy consortium comprised of the France's Total SA, Austrian OMV and Spanish Repsol to conduct research for gas in the Black Sea field of Khan Asparuh. Identical competitions with international companies will take place in due time for the offshore locations of Silistar, Sveta Marina and Teres.

Regarding shale gas, Haritonova stated that for the moment the energy Ministry is following the moratorium of the Parliament, and until it is lifted no research could be made.  It is interesting to note that Bulgaria's special advisor of the ministry of economy Petar Poptchev noted that Chevron was not so much interested in shale gas exploration, but in conventional gas.

Unconventional gas in Europe: Frack to the future

The Economist

SHALE gas and oil are propelling America to energy self-sufficiency and giving its economy a handy boost. Europe’s shale-gas deposits are said almost to match those across the Atlantic (see map). Will the old continent soon enjoy the same benefits?

The mismatch between the hope and reality for European shale gas was neatly summarised by a deal sealed on January 24th that will allow Shell to probe Ukraine for unconventional gas. Ukrainian politicians talked of a $10 billion investment. Shell took a more cautious line. The firm certainly hopes to find plenty of gas in eastern Ukraine. But it will first do some seismic testing and sink 15 test wells. If the results are disappointing it could, like ExxonMobil in Poland, walk away.

It is too early to tell whether Europe’s shale beds will really prove as bountiful as America’s. Only a handful of test wells have been sunk. Exxon may have quit Poland, the country where exploration has gone furthest, but other firms are having more joy. Determining which countries might enjoy a bonanza of cheap gas is highly speculative, a recent report by Deutsche Bank points out: many things are in flux, including extraction technologies and production rates.

Egypt to hold tender for energy drilling in the Mediterranean Sea


Egypt will hold a tender for energy drilling in the Mediterranean Sea, Egyptian Minister of Investment Osama Saleh said yesterday.

Saleh said they would invite leading international companies by the end of the year or at the beginning of next year to hold a tender for energy exploration and drilling in the Mediterranean Sea.

“The explorations by the Greek Cypriot administration entered into the continental shelf of Egypt, which is a subject of international law and agreements,” Saleh said.

Saleh said Egypt had laws that protected investors, adding that there was no situation that would affect investors negatively in Egypt. “There is no need to give investors in Egypt assurances. I’ve talked to investors in Egypt, and they are satisfied with the situation and have plans to do more business and expand their existing businesses. Egypt is a state with laws and institutions to protect investors.”

The investment system in Egypt is different, Saleh said. “Turkish investors prefer to build export-oriented factories in free trade zones because they are exempt from taxes.”

Egypt has bilateral agreements with Arab, African, European and American countries. “Therefore we present our investors a market with a population of 1.5 billion. The products exported from Egypt to these countries are not subject to customs and extra taxes.”

Saleh said a lot of Turkish factories had moved to Egypt because of qualified and cheap workers. “Among our targets are construction and contracting companies,” he added.

10 Nisan 2013 Çarşamba

Turkey, Iraq warm to new pipeline as supply surges

Today's Zaman

Turkey reiterated its willingness to build a new pipeline in cooperation with energy-rich Iraq for a second time in less than a week after Iraqi Prime Minister Nouri al-Maliki made statements aimed at breaking the ice with Ankara following months of hostile rhetoric.
The statements come at a time of new oil discoveries in Iraq with the existing pipeline infrastructure starting to fall short of meeting overseas demand, undermining the war-torn country's potential to boost energy exports incomes. Ankara and Baghdad have been at odds over a disagreement between the two to export northern Iraq's oil via Turkish markets. The latest developments, however, enhanced the chance for reconciliation between the two with the central government in Baghdad appearing to be less skeptical about Ankara's engagement with the autonomous Kurdistan region -- or Kurdistan Regional Government (KRG) -- to the north. Resource-hungry Turkey has heavily courted Iraqi Kurds regardless of the strife with Baghdad and continues doing so.

In an op-ed article published in Washington Post to mark the 10th year of US invasion in Iraq, Maliki said Baghdad “is committed to good relations with all our neighbors … offering the hand of friendship to Jordan, Turkey, Saudi Arabia and Kuwait.” Turkish energy minister Taner Yıldız said in Ankara on Wednesday that the government “is ready to cooperate in building a new pipeline that could serve as an alternative to an existing Baghdad-controlled Kirkuk-Yumurtalık pipeline to Turkey.” Exports via that channel dried up in December -- from a peak of around 200,000 barrels per day (bpd) -- due to a row with Baghdad over payments. Last month Yıldız said the Baghdad government has offered to build a pipeline from the Iraqi oil site of Basra to Ceyhan.

9 Nisan 2013 Salı

Turkey says joint energy projects with Greek Cyprus, Israel possible

Bülent Keneş      Todays' Zaman

Weary of a lingering political tension undermining potential large-scale energy deals in its surrounding region, Turkey sees it possible to cooperate with Greek Cyprus and Israel in joint energy projects in the Mediterranean “so long as the political atmosphere allows it,” Turkish Energy Minister Taner Yıldız told a meeting in Baku on Monday.
The minister was speaking at a meeting with the State Oil Company of Azerbaijan Republic (SOCAR) president on the sidelines of the World Economic Forum Strategic Dialogue on the future of the South Caucasus and Central Asia that kicked off in Baku on Monday.

“In case of a possible remedy to political issues that remain a gridlock hindering further prosperity in our region, Turkey will be ready to take steps in order to ensure a lasting peace environment,” Yıldız said in a rare statement of what can be regarded as "extending an olive branch.”

Underlining that a recent Israeli apology to Ankara over the Mavi Marmara raid should not be seen as an excuse for future energy partnerships with this country, Yıldız told reporters: “But it is possible that a cooperation in energy between Turkey and Israel follow an anticipated rapprochement.” He said Turkey will then “not only warm to partnering in energy deals with Israel but also would like to see Greek Cyprus be involved here.”

Turkey-Israel: the new Great Game

Daniel Dombey          Financial Times - BeyondBrics

There is a new Great Game afoot and it is taking place beneath the sea floor of the eastern Mediterranean.

Turkey and Israel’s tentative reconciliation is a process so fraught that US Secretary of State John Kerry appeared in Istanbul at the weekend to chivvy the two sides towards restoring full diplomatic ties. But if the steps he set out can be taken — agreeing compensation for nine Turks killed by Israeli forces in 2010, avoiding inflammatory talk, exchange of ambassadors — then a whole series of changes could be unleashed from Damascus to Brussels.

In particular, there is the question of a pipeline that could ferry newly discovered Israeli natural gas to energy-hungry Turkey — a move that would knit the two US allies closer together, despite enduring suspicions.

“It is possible that cooperation in energy between Turkey and Israel could follow an anticipated rapprochement,” said Taner Yilidz, Turkey’s energy minister, on Monday.

Turkish officials caution that bilateral talks on such cooperation can only really get going after ambassadors are exchanged — but add that business contacts on the topic are already burgeoning.

$10-12 bn to be invested in TANAP project

Nearly $10-12 bn is expected to invest in TANAP project.
Nearly $10-12 bn is expected to invest in TANAP project, SOCAR President Rovnag Abdullayev said at the meeting with Energy Minister of Turkey Taner Yildiz, APA-Economics reports.

To him, at present time, works are conducted in direction of legal and financial issues of the project: ‘Physical works on TANAP project is expected to start in Q2, 2014’.

Turkey sets high arms export hopes

Defense and aerospace industry product exports of Turkish manufacturers have soared by 11.5 percent in the first three months of the year in spite of the fall in March. The United States still dominates the arms exports but the sector eyes to expand the variety of destinations as well as the goods

Turkey’s defense and aerospace industry exports in the first quarter have surged by 11.5 percent compared to the same period last year, reaching $272.2 million, with 39 percent of these exports going to the United States. The chairman of the defense and aerospace industry exporters union has said the year-end target is $1.5 billion.

Despite the overall 10.2 percent fall in exports in March on a yearly basis, Turkish arms manufacturers managed to raise their exports by 11.5 percent, thanks to the 33 percent increase in the first two months of the year, according to data provided by the Turkey Exporters Assembly (TİM).

The U.S. received the highest share of defense industry exports with $105.2 million, while Bahrain was second with $24.7 million and Italy followed them with $17.8 million.

$1.5 billion target

Defense and Aerospace Industry Exporters Union Chairman Latif Aral Aliş said the sector had been on the rise in recent years and exports had been steadily soaring. Nevertheless, they still eye even higher rises.

8 Nisan 2013 Pazartesi

The Turkey - Russia - Iran Nexus: Eurasian Power Dynamics

Stephen J. Flanagan      The Washington Quarterly

Complex and often contradictory interactions among Turkey, Russia, and Iran are shaping regional dynamics in the Middle East, Caucasus, and Central Asia. The nexus of the three pairs of relations are influencing each country’s dealings with the other two, as well as with the United States, and are whipsawed by events on the ground that continue to surprise leaders of these three historic rivals. Starkly differing policies toward the Syrian civil war and the Arab Awakening have strained Ankara’s previously cooperative relations with Moscow and Tehran.

Understanding these dynamics is essential to avoiding a wider war in the Middle East, renewed conflict in the Caucasus, and instability in Central Asia following the withdrawal of NATO forces from Afghanistan. Moreover, with the proxy war in Syria deepening and the prospect of Israeli military strikes against Iran’s nuclear facilities, the Middle East is reaching a tipping point unless the United States and the international community are able to work with these three powers to broker a political transition in Syria and a resolution of the Iranian nuclear crisis, which would otherwise have devastating consequences for regional stability and the global economy.

For Download full article please click here 

Source: The Washington Quarterly

Interview with Charles Ellinas Chairman Of Cyprus Hydrocarbons Co.

Cyprus Mail

Interview with Charles Ellinas, chairman of the state hydrocarbons company KRETYK

* ‘Business as usual’ for oil and gas giants: Cyprus’ financial crisis not a problem
* Noble rebuffed Turkish demands to back away from exploratory drilling
* Six licensed blocks may hold 30 trillion cubic feet of gas - building an LNG first is a must

Q: There appears to be some confusion over the precise role of KRETYK, with reports suggesting some overlap with the duties of the Natural Gas Public Company, DEFA. Could you clear that up?

A: We are an oil and gas company, much like, say, Italy’s ENI. There is no overlap with DEFA, because we’ve met with them, and we agreed we have no intention of getting involved in gas sales and distribution in the island. And as far as I’m concerned, when we do bring the gas to the island - hopefully in 2018 - to Vasilikos plant there will be a link there and DEFA will take their gas and off they go. They’ll sell and distribute it and everything else. That’s not our job. DEFA is much like a utility company, much like for water. Gas is also a utility.

KRETYK is responsible for developing, managing exporting and operating gas. The Energy Service at the Commerce Ministry is responsible for licensing, and also polices adherence to the requirements of the production-sharing agreements. The companies involved in the production-sharing agreements have obligations to fulfill. We are not going to be policing that, it’s the job of the Energy Service, and there’s a very good reason for it: it could be that by the third round of licensing we could be strong enough to go into business with someone else and be part of a license. So we can’t be policing ourselves, someone else has to do it.

PRIO’s report - The Cyprus Hydrocarbons Issue: Context, Positions and Future Scenarios

Peace Research Institute Oslo (PRIO)

The discovery of hydrocarbons by Eastern Mediterranean countries that were previously thought to have no such natural resources is changing the geopolitics and economics of the region in ways that are still evolving. This study focuses on the case of Cyprus. It examines the relevant developments from the legal, political and economic angles, with the aim of producing a primer for those who are interested in the Cyprus hydrocarbons issue and wish to understand its many different aspects.
First we outline recent natural gas discoveries in the region and assess the significance of finds offshore Cyprus. We then examine the legal framework of maritime delineation in the region, in particular the UN Convention on the Law of the Sea (UNCLOS or the Convention) as well as the reasons why neighbouring Turkey objects to certain UNCLOS articles and therefore why it has not signed the Convention. In this context we also detail the maritime jurisdiction disputes in the region which relate to Cyprus, including the dispute between Greece and Turkey in the Aegean Sea and the maritime border dispute between Israel and Lebanon.

For those who are unfamiliar with the Cyprus problem we give the historical and political background to the problem and particularly the dispute about sovereignty between the island’s Greek Cypriot and Turkish Cypriot communities. We then outline the positions on hydrocarbons exploration of various parties involved in the dispute: the Greek Cypriots, the Turkish Cypriots, Turkey (including the difference in Turkey’s stance between exploration in the south of the island and exploration west of the island), as well as the response of the international community. We explain that, while it is clear that the international community supports the right of the (de facto Greek Cypriot) Republic of Cyprus (RoC) to explore for oil and gas, it also has strong expectations that the hydrocarbons revenues be shared in the event of a solution to the Cyprus problem.

For Download full report please click here

Source: Peace Research Institute Oslo (PRIO)

Cyprus seeks to speed up EEZ demarcation with Lebanon

The Daily Star Lebanon

BEIRUT - Cyprus Energy, Commerce, Industry and Tourism Minister Giorgos Lakkotrypis said Thursday his country was seeking to increase its cooperation with Lebanon in gas and oil exploration, adding that the demarcation of the Exclusive Economic Zone should be pursued rapidly.

The minister, who held talks with President Michel Sleiman, caretaker Prime Minister Najib Mikati and caretaker Energy Minister Gebran Bassil, is trying to expedite the demarcation of the joint maritime border between Lebanon and Cyprus to avoid any future conflict.

According to sources, Lakkotrypis is also trying to find a solution regarding the disputed maritime border between Lebanon and Israel. The disputed waters cover an area of 850 kilometers.

Lebanon has sought the help of the U.N. and U.S. to determine its actual share in this disputed zone. But the mediation efforts between Lebanon and Israel have not produced any results, according to observers.

Lakkotrypis described his talks with Lebanese officials as very productive, noting that both sides were keen to increase cooperation in gas exploration.

He added that Cyprus and Lebanon have reviewed ways to explore the joint gas wealth off the coast.

6 Nisan 2013 Cumartesi

Iran Beyond Oil?

Patrick Clawson*      The Washington Institute 

The image of Iran's economy as oil, carpets, and pistachios was always flawed, but has now become badly dated. The Islamic Republic is in the midst of a non-oil export boom -- it has the potential to remain a middle-income country even with no oil exports, and the reserves to finance the transition in the meantime. 

For years, Iran's leaders called for reduced reliance on oil but did little to meet that goal. Western sanctions have seemingly spurred them to action -- in his annual Nowruz address on March 21, Supreme Leader Ali Khamenei acknowledged for the first time that restrictions on the country's oil exports had made a serious impact: "The sanctions have had an effect, which is because of an essential flaw that we are suffering from. The flaw that our economy is suffering from is that it is dependent on oil." He also acknowledged that Iran's "economic weakness" had led to "harsh conditions for certain groups of people." Rather than change Iranian nuclear policy, however, he argued, "We can turn every threat into an opportunity...The sanctions caused the massive domestic capacities of the Iranian nation to become activated."


While still important, oil is becoming a smaller part of Iran's trade. In 2012, the country imported $57 billion in goods and exported $34 billion in non-oil products, meaning that non-oil exports covered 60% of the import bill, compared to 24% in 2002 and 14% in 1992. It produced this shift in part by converting more of its oil into industrial products for export; according to the Iranian Customs Administration, the $29.2 billion in non-oil exports over the first eleven months of fiscal 2012/2013 included $9.0 billion in chemical products (mostly petrochemicals such as urea fertilizer and polyethylene) and $3.2 billion in plastics made from oil. But other products are also being exported at high rates, including $8.2 billion in minerals, stone, cement, and related products, $5.3 billion in agricultural products, and $800 million in carpets. The country's largest market is Iraq, which took $5.6 billion in goods over the same period, including much of Iran's manufactured exports (e.g., more than $300 million in automobiles). The next-largest customers were China ($4.8 billion), the United Arab Emirates ($3.9 billion), Afghanistan ($2.5 billion), India ($2.4 billion), and Turkey ($1.3 billion).

Iraq Energy Profile: Has Surpassed Iran In Producing Crude Oil – Analysis


Iraq has the fifth largest proven crude oil reserves in the world, and it passed Iran as the second largest producer of crude oil in OPEC at the end of 2012.

Iraq was the world’s eighth largest producer of total petroleum liquids in 2012, and it has the world’s fifth largest proven petroleum reserves after Saudi Arabia, Venezuela, Canada, and Iran. Just a fraction of Iraq’s known fields are in development, and Iraq may be one of the few places left where much of its known hydrocarbon resources has not been fully exploited. Iraq’s energy sector is heavily based on oil. Over 90 percent of its energy needs are met with petroleum (2010 estimate), with the rest supplied by natural gas and hydropower.

Iraq has begun to develop its oil and natural gas reserves after years of sanctions and wars, but it will need to develop its infrastructure in order to reach its production potential. According to estimates by Iraq’s Deputy Prime Minister for Energy, capital expenditures of $30 billion per year in Iraqi energy infrastructure are required to meet Iraq’s production targets. Progress has been hampered by political disputes and the lack of a law to govern development of Iraq’s oil and gas. The proposed Hydrocarbon Law, which would govern contracting and regulation, has been under review in the Council of Ministers since October 26, 2008, but has not received final passage.


Despite having large proven oil reserves, increases in oil production have fallen behind ambitious targets because of infrastructure constraints and political disputes.


Iraq revised its estimate of proven oil reserves from 115 billion barrels in 2011 to 141 billion barrels as of January 1, 2013, according to the Oil and Gas Journal. Iraq’s resources are not evenly divided across sectarian-demographic lines. Most known hydrocarbon resources are concentrated in the Shiite areas of the south and the ethnically Kurdish region in the north, with few resources in control of the Sunni minority in central Iraq.

The majority of the known oil and gas reserves in Iraq form a belt that runs along the eastern edge of the country. Iraq has five super-giant fields (over 5 billion barrels) in the south that account for 60 percent of the country’s proven oil reserves. An estimated 17 percent of oil reserves are in the north of Iraq, near Kirkuk, Mosul, and Khanaqin. Control over rights to reserves is a source of controversy between the ethnic Kurds and other groups in the area. The International Energy Agency (IEA) estimated that the Kurdistan Regional Government (KRG) area contained 4 billion barrels of proven reserves. However, this region is now being actively explored, and the KRG stated that this region could contain 45 billion barrels of unproven oil resources.

5 Nisan 2013 Cuma

Turkey seeks deeper energy relationship with Iraq and KRG

Orhan Coşkun     Reuters

Turkey would play an active role in any arrangement in Iraq under which crude oil export revenues are shared between the central government and the northern Iraqi Kurdistan region, Energy Minister Taner Yildiz said on Thursday.

Yildiz told Reuters in an interview Turkey stood ready to support an arrangement under which 83 percent of oil export revenue went to Baghdad and the remaining 17 percent went to the government of the autonomous Kurdistan region.

"There is nothing on this issue that would unsettle the Iraqi central government," Yildiz said.
"Turkey would play an active role in giving the 17 percent to northern Iraq and 83 percent to the Iraqi central government."

Oil lies at the heart of a long-running feud between the central government and the autonomous Kurdistan region. Baghdad says it alone has the authority to control exports and sign contracts, while the Kurds say their right to do so is enshrined in Iraq's federal constitution.

The Kurdistan Regional Government (KRG) started on the path towards economic independence early this year by exporting small volumes of crude oil by truck to Turkey.

4 Nisan 2013 Perşembe

Turkey nears decision on $20bn nuclear deal

Daniel Dombey     Financial Times

Turkey is in the final stages of deciding a showpiece nuclear power tender, with the choice resting between Japan and China.

The project, expected to be worth more than $20bn, has taken longer than expected to decide, with Turkey’s insistence on financial guarantees from the contactors or their home nations proving a key point of discussion.

“The competition continues. We are still in talks with China and Japan,” said Taner Yildiz, Turkey’s energy minister. “China and Japan are keen for the project.” He added that South Korea had pulled out of the tender because of problems over a treasury guarantee. A Canadian bid had previously pulled out.

Mr Yildiz added that Turkey had told South Korea that the question of a treasury guarantee was one of Turkey’s “red lines” for the project, and that “very intensive meetings with China and Japan are approaching the end.”

Japan’s Nikkei business daily had reported earlier on Thursday that Mitsubishi Heavy Industries and France’s Areva had won the order, citing Japanese and Turkish sources.

The newspaper said the Turkish energy ministry had informed Japanese government and corporate officials of the decision to award the deal to build four pressurised water nuclear reactors with a combined capacity of about 4.5 gigawatts at Sinop on the Black Sea, the report said.