SOCAR Turkey signs Star refinery construction agreement

Cihan

Today, Socar Turkey Company, a subsidiary of the State Oil Company of Azerbaijan (SOCAR) signed an agreement with the consortium that is going to build the Star refinery in Turkey worth $4 billion, Petkim petrochemical complex for which the refinery is planned to be constructed told Trend. From the Socar Turkey side the agreement was signed by the Petkim chairman Vagif Aliyev. The consortium which won the tender for the construction of the Star refinery consists of the following companies: Spanish Tecnicas Reunidas, Italian Saipem, South Korean GS Engineering & Construction and Japan's Itochu. As Yavuz noted previously, Star refinery's processing capacity will equal 10 million tons of oil and capable of processing such oil grades as Azeri Light, Kirkuk and Urals. Annual production at the refinery will equal 1.6 million tons of naphtha which will reduce Petkim's dependence on imports of this type of oil product to zero, he said. According to Yavuz, along with naphtha, the Star refinery will also produce 5.9 million tons of diesel fuel with ultra-low sulphur, 500 tons of aviation fuel, 630,000 tons of petroleum coke, 240,000 tons of liquefied petroleum gas, 415,000 tons of mixed xylenes, 75,000 tons of olefin liquefied petroleum gas and 145,000 tons of sulphur.

Turkey-Kurdish oil deal reflects end of post-Ottoman order

David Gardner      Financial Times

Confirmation last week that Turkey plans to buy into the oil and gas wealth of the self-governing Kurdish region of northern Iraq has led to warnings – most stridently from the US – that Ankara is gambling with the break-up of Iraq. Indeed. But there is more at stake than that. Drop a rock in any pool in this febrile region – now hyperconnected in all the wrong ways – and the ripples will reach every shore.

In Iraq, the Kurdistan Regional Government and the national authorities in Baghdad are nowhere near a pact for sharing the country’s potentially huge oil revenues, much less a working model of federal power-sharing – with the Baghdad government of Nouri al-Maliki, a Shia Islamist aligned with Iran, invariably favouring sect and faction above state and nation.

But the future of Iraq is now just part of a discussion about the possible break-up of bits of the Middle East, given new urgency by the disintegration of Syria under the pulverising effect of two years of civil war.

That conflict has prised loose the Kurdish region of northeast Syria, galvanising Turkey into making peace with its own Kurds and drawing Iraqi and Syrian Kurds into an economically dynamic Turkosphere.

That this debate is only just starting suggests just how problematic it is – and how immense its possible consequences. What is in play is the state system that succeeded the Ottoman Empire almost a century ago in Syria and Mesopotamia.

S&P Report: As Turkish Economic Growth Bounces Back, The Central Bank Faces A Familiar Quandary

Standard & Poor's

S&P EMEA Chief  Economist Jean-Michel Six says Turkish economy is on a sustained path to recovery.

The Turkish economy saw the wind knocked out of its billowing sails in 2012, but it is making something of a
comeback in 2013. Standard & Poor's Ratings Services expects the real economy to expand by about 4% this year--nearly double the rate of growth of 2012, but well below what we believe were unsustainably high growth rates in 2010-2011. Trends in global trade should provide a boost to Turkey's economy, given the way the country's export market shares have evolved over the past 10 years. Meanwhile, private consumption and fixed investment are likely to bounce back this year and next, after some retrenchment in 2012.

Against this positive backdrop, continued expansionary monetary policies in the G7 and especially in Japan, could present renewed challenges for the Turkish central bank: namely, strong capital inflows into the country could spark a surge in asset prices, as they have done in the past. What's more, amid stronger domestic demand, the country's current account deficit is likely to widen this year and inflation could overshoot the central bank's target. In suc circumstances, we believe the central bank could well be forced to maintain a difficult balancing act between the demand for growth and monetary stability.

Overview
· The Turkish economy appears to be on a sustained path to recovery, owing to strong growth in its main export
markets outside of Europe, improved prospects for consumer demand, and solid investment growth.
· This recovery, however, could amplify existing external and inflatonary risks, and we forecast that Turkey's
current account deficit will widen this year to about 7% of GDP.
· However, in a complex global financial environment, we believe the central bank will not raise its policy rate
earlier than the start of 2014.

For Download the full report please click here: https://docs.google.com/file/d/0B_--THmzd4TsSlBDYy1raXRzQ3M/edit?usp=sharing

Turkey agrees energy deal with Kurdish north Iraq

Daniel Dombey        Financial Times

Turkey has defied both Washington and Baghdad by agreeing an energy deal with the north of Iraq that the US warns could further fracture the Middle Eastern state, but which Ankara sees as central to its own future.

Several Turkish officials confirm Ankara struck a secretive framework agreement earlier this year with the autonomous Kurdish Regional Government of Northern Iraq for Turkish state energy companies to take stakes in the region’s oil and gasfields. They add the deal is still so sensitive that it is unlikely to be acknowledged publicly until after a visit by prime minister Recep Tayyip Erdogan to Washington this week, a trip that takes place against a backdrop of increased tension in Iraq itself.

The agreement, together with Turkey’s political opening towards its own Kurdish population, is set to bolster Ankara’s influence in the energy-rich north of Iraq and could help it generate sufficient energy supplies to meet its ambitious growth targets. Mr Erdogan has previously described the deal as a “win win”.

Kurdish officials welcome closer relations. “Let’s be honest: Turkey is our door to the world,” said one, pointing to the KRG’s problematic ties with other neighbours. “Look at the [strained] situation with Iran, Syria, the rest of Iraq . . . Turkey is a big power in the region and, if it follows good policies like at the moment, why not be an ally?”

But the central Iraqi government in Baghdad says that without its permission the energy agreement violates the Iraqi constitution. A direct pipeline link to Turkey under the deal would give the KRG, which already has its own military force, much greater economic independence than before. At present, the only export pipelines available to the region are federally controlled and the KRG has halted exports through them because of a budget dispute with Baghdad.

Energy rush to Central Anatolia

AA

Central Anatolian district of Karapınar is set to be Turkey’s energy hub with solar and coal power projects in the pipeline, which will account for 8 percent of country’s energy need as they go online.

Energy producers are rushing to the Central Anatolian district of Karapınar in an effort to cash in on Turkey’s second largest coal reserves, as well as sunny fields that present ample opportunity for solar power.

Some 57 companies – most of them foreign consortiums – have already started queries on the 60 million-meter-square area that has designated as a special energy area by the government, Karapınar Mayor Mehmet Mugayıtoğlu recently told Anatolia news agency.

The district in Konya, which was once a source of migrants in the 1960s, is forging a future as an energy production hub of Turkey.

The Energy and Natural Resources Ministry announced in January that it had discovered 1.8 billion tons of lignite reserves in the province, enough to fuel a thermal power station generating 5,000 megawatts of electricity for 30 to 40 years.

Mugayıtoğlu said the studies to establish a power plant there were continuing.

“A coal power plant producing 4.8 million megawatts will be established under the build-operate model,” he said.

A lost decade for European natural gas?

IEA

Once-certain growth in demand withered away, but there are reasons to expect a resurgence

Like an athlete striving to re-attain past glories, European gas companies, along with their suppliers, look at domestic consumption and wonder, “When will it return to the record level of 2010?”

European OECD member countries consumed 567 billion cubic metres (bcm) that year, an 8% gain that more than wiped out the 6% drop in 2009 caused by the economic crisis.

But, as the IEA warned in the Medium-Term Oil and Gas Market Report 2011, that dramatic increase was an illusion, with half of the gain driven by a particularly cold winter. The milder 2011, along with anaemic economic growth and higher gas prices, indeed saw a 8% decline in demand. Neither the economic nor the pricing environment improved in 2012, and demand is estimated to have declined by 2%, getting close to the 500 bcm mark. Seasonally-adjusted gas consumption has actually lost ten years of gains, and a few countries, such as the United Kingdom, are back to levels unseen since 1995.

Only five years ago, most scenarios assumed that European gas demand would be well above 600 bcm in 2015 and around 700 bcm by 2030, driven by the power sector. Gas-fired plants were to benefit from their lower CO2 emissions compared with coal and their complementarity with renewables. Only scenarios featuring a strong increase of nuclear, renewable energy or both, plus drastic improvements in energy efficiency, were expected to dampen or reverse this growth track, and even then only in the long term (post-2020).

Turkmenistan urges acceleration of TAPI construction

Trend

Turkmen President Gurbanguly Berdimuhamedov stressed the need to intensify work on the Turkmenistan-Afghanistan-Pakistan-India (TAPI) transnational gas pipeline, Turkmen television said today.

According to the report, the issue was discussed at a government meeting," the statement said. "A report on the operations of equipping "Galkynysh" gas field in Mary region with the necessary facilities was also voiced. It is the future key raw material source for a number of alternative projects.

"Turkmen President Gurbanguly Berdimuhamedov stressed the need to intensify work on the practical realization of the TAPI project," a statement said.

According to the Turkmen leader, the formation of a multi-variant system of transporting the energy resources to the world market is a key aspect of Ashgabat's energy policy.

The basic document for the promotion of the TAPI project is the Ashgabat interstate agreement of the state parties on the commencement of the practical implementation of the TAPI project signed in late 2010.

In May 2012, the Turkmen government entered into an agreement for the sale of natural gas with India's GAIL Ltd. A memorandum of understanding was signed with Afghanistan.

The design capacity of TAPI is 33 billion cubic meters of natural gas per year. The estimated length is 1,735 kilometres. It is expected that the pipeline will extend from the largest gas field in Turkmenistan 'Galkhynysh' through the Afghan cities of Herat and Kandahar to the Fazilka settlement on the Pakistani-Indian border.

Source:  http://en.trend.az/capital/energy/2148032.html

Iran's non-oil exports to reach $59 billion

Trend

Iran's non-oil exports will reach $59 billion in the current calendar year, which ends March 20, 2014, the Deputy Director of the Trade Promotion Organization of Iran, Kioumars Fathollah Kermanshahi said on Monday.
The announced figure is based on the Fifth Five-Year Economic Development Plan, the IRNA News Agency quoted Kermanshahi as saying.
He went on to note that technical and engineering services will account for $18 billion of the mentioned amount.
According to the director of Trade Promotion Organization of Iran, Hamid Safdel, Iran's total non-oil exports stood at $50 billion in the previous year.
Iran had non-oil trade with 196 countries in the mentioned period.
The country's balance of trade with 97 countries such the United Arab Emirates, South Korea, Switzerland, turkey, and China was negative in previous year, the ISNA News Agency reported on March 6.
Tehran's balance was also positive with 99 countries, including Iraq, Afghanistan, India, Turkmenistan, and Pakistan.

Source: http://en.trend.az/capital/business/2148098.html

Russia's Energy Bully Takes a Fall

Alexandros Petersen       Foreign Policy

Just a few years ago, Gazprom had Europe eating out of its hand. But now, the energy giant -- and Putin's power base -- looks set for hard times.

After years as Eurasia's energy bully, Russia's state-controlled natural gas monopoly, Gazprom, is getting a taste of its own medicine. Even as Gazprom seeks to build the tallest skyscraper in Europe as its new headquarters in St. Petersburg, pressure from Russia's neighbors led to a 15 percent decline in the company's profits last year, eating into the state budget. Moscow's single-minded focus on gas exports in an effort to become, in the words of President Vladimir Putin, an "energy superpower" has crippled its ability to adapt to profound changes in the global energy landscape -- from the shale gas revolution in North America to the dynamism of new market players such as Azerbaijan. Having spent the last decade making enemies in Central Europe and Central Asia, Gazprom and Russian decision-makers are now reaping what they have sown. 

Policymakers in European capitals could be forgiven for a little schadenfreude right now. Building on the legacy of Soviet gas exports to the Eastern Bloc and parts of Western Europe, Putin and his cohorts in the Kremlin have, for years, used Gazprom as a cudgel in Moscow's relations with European Union member states. Over the past decade, well over a third of EU gas imports have come from Russia, with a number of Eastern European states almost completely dependent on Gazprom. Bulgaria, for example, receives more than 95 percent of the natural gas it consumes from the company. Millions of European consumers shivered through the winters of 2006, 2008, and 2009 when Gazprom cut off supplies in order to squeeze middlemen in Ukraine, Belarus, Georgia, and Moldova who had had the temerity to buck Moscow's policies.

Russian Rosatom seeking partnership for nuke plant in Turkey

Hurriyet Daily News

Russian Rosatom is reported to establish a partnership with France-based EDF and to give it a share in the nuclear plant to be built in Mersin-Akkuyu as well as others. “We own for the moment 100 percent of the 4.800 megawatts we are building in Turkey and we are ready to substantially cut (our holding),” Rosatom Deputy Chairman Nikolai Spasskyi according to the French daily Les Echos.

Rosatom appears to agree partnership deals with French power group EDF and is proposing it take stakes in nuclear power stations Rosatom is building in Kaliningrad and Turkey, Les Echos reported on Monday.

EDF and Russia’s state-owned nuclear company laid the basis for closer ties with an agreement in 2010 for co-operation in fields such as research and development and possible joint projects.

“EDF is one of the biggest world players in this sector and we are proposing interesting projects,” the paper quoted Rosatom Deputy Chairman Nikolai Spassky telling it on the margins of a meeting on nuclear energy hosted by the OECD. EDF declined comment.

Spassky said the Russian company was also interested in developing partnerships with French nuclear group Areva, which is one of the partners of the Japanese-French consortium which would build the second nucelar plant of Turkey, and was ready for “concrete industrial co-operation” with it as well as with EDF, the paper reported.

Source:  http://www.hurriyetdailynews.com/russian-rosatom-seeking-partnership-for-nuke-plant-in-turkey-.aspx?pageID=238&nID=46374&NewsCatID=348