New gas find "transformational" for Turkey: WoodMac

- This is Turkey’s biggest-ever find by a wide margin and one of largest global discoveries of 2020, WoodMac analyst says

A gas discovery of the scale of the Tuna-1 find in the Black Sea, if developed, would be transformational for Turkey, according to global energy consultancy firm Wood Mackenzie on Friday.

'Turkey is chiefly reliant on piped gas from Russia, Azerbaijan and Iran but the share of liquefied natural gas imports has also continued to grow,' the firm said in a statement.

Thomas Purdie, an analyst on Wood Mackenzie’s upstream research team, stressed that 'even if the official 320 billion cubic metre figure given by Turkish President Recep Tayyip Erdogan when he announced the discovery is treated as an estimate of gas in place, this is Turkey’s biggest-ever find – by a wide margin – and one of the largest global discoveries of 2020.'

He also noted that the discovery reaffirms the deepwater Black Sea’s hydrocarbon potential after several disappointing wells in Bulgaria.

However no matter the political and economic importance, reaping the supply rewards will be complex and a 2023 date for bringing the discovery – renamed Sakarya - looks ambitious, according to Purdie.

“First and foremost, the discovery will need to be appraised by more wells – to improve understanding of the geology and confirm resource estimates. It’s early days, but any future development would cost billions of dollars. Deepwater projects are complex in any environment, but the Black Sea poses additional logistical challenges that must be managed,' he warned.

Purdie explaİned that this is one of the factors that has stalled Romania’s Neptun Deep megaproject, located just 100 kilometers north of the Tuna well.

Turkish Petroleum Corporation (TPAO) would benefit from bringing an international partner into the project, Purdie said, adding that there could be attractions despite the market outlook – highly competitive tax terms in a basin that international oil companies know increasingly well over recent years.

'Majors operating across the border in Romania and Bulgaria have had mixed recent success, but will take note of this momentous news,” he concluded.


- 'This discovery could have far-reaching implications'

Murray Douglas, director at Europe gas, also said that the Turkish gas market is large, with 2019 demand of almost 45 billion cubic meters.

'Gas demand has fallen year-on-year since 2017. Much of that is down to the weak Turkish economy and increased competition from coal-fired and renewable generation,' Douglas added.

However, despite coronavirus, Turkish gas demand has only fallen 3%, year-to-date, versus last year, according to Douglas, while that is a less severe fall than many other European markets.

'In the 2020s, this discovery could have far-reaching implications for future gas imports and upcoming negotiations with suppliers – with Gazprom, Azerbaijan and Iran,” he stressed.

President Recep Tayyip Erdogan on Friday announced the discovery of 320 bcm of natural gas reserves in the Black Sea, near the Turkish coast, hailing the find as the 'biggest gas discovery” in Turkey’s history.

The discovery in the Tuna 1 well at Sakarya Gas Field, which is around 170 kilometers offshore Black Sea, is the result of Turkey's insistent efforts for finding domestic hydrocarbon resources.

Fatih drill ship, which started drilling in the area on July 20, 2020, discovered the well after a month of drilling.

By Ebru Sengul Cevrioglu

Anadolu Agency

energy@aa.com.tr