From A Pipeline Nation To An Energy Trading Hub

An important share of the world’s known and recoverable primary energy reserves are found in countries neighboring Turkey.

Iran alone holds 9.3% of the world’s oil reserves, while Iraq’s share is 8.8%. In the south, Saudi Arabia, with a 15.7% share, has the world’s second biggest reserves of oil. Kuwait, holds a 6% share. If you add Azerbaijan in the east and Russia to the north, half of the world’s recoverable oil reserves are located near Turkey.

The European countries, to the West, are among the main consumers of energy. But in terms of known and recoverable energy reserves, they are very weak.

The picture for petroleum is also valid for natural gas. Iraq, Azerbaijan, Iran, Qatar and Russia are some of Turkey’s natural gas rich neighbors. One must not forget the Eastern Mediterranean where Israeli natural gas and rich hydrocarbon reserves off the island of Cyprus have yet to enter the market. The major market for natural gas, the rising primary energy resource of the past 40 years, is again hydrocarbon-poor European nations.

In the global balance of energy, Turkey holds a critical geographic position. Turkey is also a key energy market. But its geographic position, as being adjacent to these areas, makes it strategically important for the security of global energy supplies.

Pipelines are used for the easiest and least expensive way to transport oil and natural gas to markets. Of course, if they can be constructed. Turkey stands in the center of the east-west and north-south of the mechanisms that will allow for the movement of energy resources. The motion has already started. Turkey receives natural gas from two pipelines from Russia, and one each from Azerbaijan and Iran. The Baku-Tbilisi-Ceyhan pipeline carries Azeri oil to the Mediterranean through Turkey.

New energy bridges are expected to be formed soon. One of these is the Trans Anatolia Gas Pipeline Project (TANAP), opened in 2018. The project is carrying natural gas from Azerbaijan’s Şahdeniz II gas fields in the Caspian Sea to Turkey and then as far as Italy via the Trans Adriatic Pipeline.

Another project under consideration would be between Iraq and Turkey. Ankara is waiting for the outcome of its energy diplomacy with the central Iraqi government in Baghdad and the regional Kurdish administration in Erbil. The project would seek to carry northern Iraqi oil to global markets through Turkey.

Major existing twin oil pipelines between Kirkuk, in northern Iraq and Ceyhan in Turkey haven’t been operating at full capacity since the 1990 Gulf War and because of differences between the Iraqi government and the Kurdish regional administration.

The least costly East-West routes for the transportation of oil and natural gas are through Turkey. This applies to the discovered energy resources in the open sea in Israel’s Eastern Mediterranean economic region.

Turkey has become an energy bridge. But operating pipelines is only one aspect of the business. The Turkish private sector sees the greatest potential in not just the nation serving as an oil terminal, but also supplying petroleum products and carrying out energy trade with new refineries.

Azeri oil reaches the Mediterranean market with the Baku-Tbilisi-Ceyhan oil pipeline through Turkey.

Izmit Bay Oil Refinery

Türkiye Petrol Rafinerileri (Tüpraş), a subsidiary of Koç Holding, refines more than 28 million tons of crude oil each year. Tüpraş, with annual sales of over $20 billion, is Turkey’s biggest industrial corporation.

Petkim Peninsula

Turkey’s largest petrochemical complex, Petkim, is located in Aliağa County on the Aegean coast, north of Izmir. Azerbaijan’s state oil company Socar acquired Petkim in 2008 through the national privatization program. Each year, Petkim exports over $500 million in chemical products.

With the wind behind it, sunny days are close...

Turkey is poor in oil and natural gas reserves, and even in coal. It hasn’t carried out enough research of its coastal areas and territorial waters, at least for now. While it hasn’t sufficient fossil fuel fuels, Turkey is rich in renewable energy resources...

Turkey is a favorite among domestic and foreign investors in wind energy. At the of 2015, Turkey was ranked 7th in wind energy capacity among European countries, according to the European Wind Energy Association, but is one of the fastest growing in wind energy investments in the world. One of the reasons wind energy investments have grown so fast in Turkey is that the government has guaranteed to acquire energy produced by private wind farms for 10 years.

Turkey has more sunny days than any other country in Europe, making it a great location for solar energy investments. It already ranks third in the world in market size for rooftop water heating solar panels. Investments in solar farms are yet in the infantile stages, but the country is soon expected to become a leading market in solar energy systems.

Geothermal energy investments in Turkey are also on the rise. Located in an earthquake zone, the country has a wealth of geothermal resources. The fact that geothermal power plants can operate uninterruptedly will help reduce Turkey’s dependency on foreign energy resources.

Due to its weather and geographic characteristics, Turkey’s agricultural and animal husbandry investments strengthens the nation’s hand in energy. The potential exists that herbal and animal wastes could be become main elements in the country’s energy mix. The government is pledging low-cost power lines and free fuel for investments in biomass-based energy plants. Some experts say that the potential of Turkey’s herbal and animal wastes could reduce its dependence for natural gas imports by half. .. Public authorities are working on projects that would integrate biomass power plant investments with agricultural and stock breeding farms as a means to produce energy more rapidly.

Turkey in Renewable Energy

In terms of the increase in geothermal capacity investments, Turkey ranks second in the world after Kenya.

Turkey has the second largest geothermal energy heating capacity in the world after China.

The nation is ranked fourth in the world in the capacity of solar energy water collectors after China, the U.S. and Germany.

Source: KPMG Turkey

Turkey’s Energy Situation

16 Billion Tons

Turkey’s known coal reserves

273 Billion Kilowatt Hours (kWh)

Turkey’s expected demand for electricity.

73 bin MW

Turkey’s electric power generatrion capacity

$100 Billion

Turkey’s investment needs in electricity generation in the next 10 years

50 Billion Cubic Meters

Turkey’s annual demand for natural gas.

3,300 kWh

Per capita electricity consumption in Turkey


Turkey’s percentage dependence on imported oil


The nation’s dependence on imported natural gas