September 18, 2024 [Offshore Engineer]- Turkish state energy company Botas has signed a 10-year agreement to import liquefied natural gas (LNG) from French oil major TotalEnergies beginning in 2027, Turkish Energy Minister Alparslan Bayraktar said on Wednesday.
The deal, which was signed on the sidelines of the GasTech conference in Houston, will see annual delivery of 1.6 billion cubic metres of LNG in 16 cargoes, Bayraktar said in a post on social media platform X.
Turkey imports most of its gas from Russia, Iran and Azerbaijan, but has made a push to diversify its long-term supply as several contracts start to expire from next year.
Imports cover nearly all of Turkey’s gas consumption needs, which last year stood at 50 billion cubic metres (bcm), but it hopes to further exploit domestic resources and become a regional gas re-exporter.
In April Botas signed a 10-year agreement with Oman and later ExxonMobil for LNG. This month Botas agreed to buy up to 4 bcm from Shell on a 10-year contract beginning 2027.
With the latest deal with TotalEnergies, Turkey will get half of its annual natural gas via LNG imports, Bayraktar said.
“We can supply (natural gas) to European markets, particularly to the ones in south-east Europe that are in need of gas,” he said.
Turkey has had the largest demand growth of all OECD countries from 2000 to 2020, with primary energy consumption nearly doubling and power demand increasing 165%, according to the International Energy Agency.
The deal with Turkey will reduce exposure to market volatility, TotalEnergies said in a statement. “This agreement enables us to secure long-term sales and reduce our exposure to spot market gas price fluctuations,” said Gregory Joffroy, Senior Vice President, LNG at TotalEnergies.
For Total, the deal cements a longer-term relationship with Botas after a first LNG contract to supply 1.2 mtpa from 2020 to 2023, and furthers its strategy to have natural gas reach 50% of its overall energy sales by 2030.
The French oil major is the world’s third-largest LNG player, with a roughly 12% market share and a current global portfolio of about 50 million tons per year.
Last year TotalEnergies bought a 50% stake in Ronesans Enerji — held by Turkish tycoon Erman Ilicak — which holds 166MW of hydroelectric assets and a pipeline of future wind, solar and battery projects.
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