Turkey’s BOTAŞ signs ten-year LNG agreement with ExxonMobil – Offshore Technology
Türkiye’s state gas grid operator, BOTAŞ, and US energy giant ExxonMobil signed an LNG trade agreement at a ceremony in Washington on Wednesday, marking a crucial step in BOTAŞ’ efforts to diversify its resources.
Turkish Energy Minister Alparslan Bayraktar said on social media platform X: “The US is one of the important countries from which we currently supply LNG. With this agreement, which is planned to be long-term, we will take another step in diversifying our resources.”
Çeşitli temaslarda bulunmak üzere geldiğimiz Vaşington’da BOTAŞ ve ExxonMobil arasında LNG ticaretine ilişkin bir iş birliği anlaşması imzaladık.
ABD, halihazırda LNG tedariki sağladığımız önemli ülkelerden bir tanesi. Uzun vadeli olması planlanan bu anlaşma ile kaynaklarımızı… pic.twitter.com/360iK6Qucr
— Alparslan Bayraktar (@aBayraktar1) May 8, 2024
According to the latest update, Türkiye will receive up to 2.5 million tonnes (mt) of LNG annually for a decade. Bayraktar has yet to disclose further details regarding the agreement.
“We are among the few countries globally with our gasification capacity. We will continue to contribute to the energy supply security of both our country and our region,” Bayraktar added.
According to the Financial Times (FT), Türkiye was in discussions with ExxonMobil to purchase LNG in a deal worth billions of dollars, as reported on 28 April. The aim is to reduce Türkiye’s dependence on Russian energy.
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Türkiye, which imports almost all of its natural gas, intends to establish a “new supply portfolio” that will make it less reliant on any individual partner, Bayraktar stated in an interview with the FT.
Bayraktar said that the details of the Exxon agreement were still being negotiated. According to pricing evaluations by data agency Argus, shipping 2.5mt of LNG to Türkiye costs approximately $1.1bn.
According to FT calculations, the 2.5mt of LNG deal with Exxon would account for approximately 7% of Türkiye’s natural gas consumption last year, based on Energy Market Regulatory Authority data.
BOTAŞ signed another LNG supply agreement with state-owned Oman LNG on 30 January. Under the agreement, Oman will supply Türkiye with 1mt of LNG annually by 2025.
Before the Russian invasion of Ukraine, Türkiye relied heavily on Russia for its gas supplies. However, many pipelines stopped delivering gas after the invasion due to Western sanctions. Türkiye mainly depends on natural gas for electricity generation and as a domestic fuel source for 80% of its population. During the summer, there is a peak demand for gas due to the increased use of air conditioners. As a result, Türkiye is actively obtaining alternative energy sources to meet its demands before the summer.
