Turkey begins receiving gas from Turkmenistan under Iran swap deal: minister

Turkey has begun receiving gas from Turkmenistan as planned under a new swap deal with Iran, Turkish energy minister Alparslan Bayraktar said March 2 in an interview published by Turkey's state news agency Anatolia.

Under the deal announced last month, Turkey is set to import 1.3 Bcm of gas from Turkmenistan via the swap deal by the end of the year, starting March 1.

The imports are being made by Turkey's state gas importer Botas under an import license that runs till 2033.

"This agreement is very important for Turkey's supply security and for Turkey to increase and diversify its gas resources," Bayraktar said, adding that the gas was being imported at a competitive price that would help reduce Turkey's national gas bill.

It comes as delivered spot LNG prices to the East Mediterranean remain high. Platts, part of S&P Global Commodity Insights, assessed the DES LNG East Mediterranean marker at $13.05/MMBtu on Feb. 28.

There has been no indication so far as to whether the swap trade with Turkmenistan will continue beyond 2025, but Bayraktar said Turkey plans to increase the volume imported, suggesting the longer-term need for a dedicated pipeline in place of the swap deal with Iran.

"In the medium and long term, the transportation of Turkmen gas to Turkey and Europe via a pipeline across the Caspian Sea would actually be the most ideal and correct method in technical and commercial terms," he said.

Several previous attempts to develop a dedicated pipeline to transit Turkmen gas across the Caspian to Azerbaijan and on to Turkey have failed.

Nakhchivan pipeline

Separately, Bayraktar said March 2 that the long-awaited pipeline from Turkey to Azerbaijan's enclave of Nakhchivan would begin operations this week.

"We are starting to export gas to Nakhchivan. The Igdir-Nakhchivan pipeline has been completed. Nakhchivan's gas needs will now be met through Turkey," he said, adding that the line was expected to be formally commissioned in a ceremony later this week attended by Turkish President Recep Tayyip Erdogan and Azerbaijani President Ilham Aliyev.

Bayraktar did not say how much gas Turkey would be supplying to Nakhchivan or on what terms.

According to previous announcements the line will have a capacity of around 0.5 Bcm/year, enough to supply Nakhchivan's annual demand.

Up to now, Nakhchivan has been supplied with gas via an existing pipeline link with Iran.