Turkey seems reluctant on Turkish Stream deal with Russia

It has been more than five months since Turkey and Russia announced the signing of a memorandum of understanding to build a new pipeline called the Turkish Stream, which would supply natural gas to some southern European countries after Russian President Vladimir Putin canceled the South Stream project in reaction to the European Union. 

Turkey’s initial agreement with Russia for this pipeline was a surprise and even a disappointment for many in the West, as it came only months after Moscow annexed Crimea and changed the borders of Europe by force. Turkey had announced that it wouldn’t join in imposing sanctions on Russia, although it denounced the annexation of Crimea, and agreed to negotiate with its northern partner for the pipeline. 

Turkish government officials continue to recall that what was signed on Dec. 1, 2014, was a memorandum of understanding and not a full agreement and therefore nothing has been finalized yet. Turkish and Russian energy officials have had talks in the aftermath of the December 2014 talks but no progress has been cited over the proposed pipeline. 

Indeed, some regional and economic developments in the last couple of months are giving more clues that a quick final deal between Ankara and Moscow is not on the horizon. 

One of the most recent and important developments is the tension between Turkey and Russia over Putin’s description of the 1915 killings of Armenians by the Ottoman Empire as genocide. Turkey strongly condemned Putin’s use of this word as well as the Russian Duma’s resolution on April 24 that categorized the massive deportation as genocide. Unlike Austria and the Vatican, Turkey did not recall its ambassador from Russia and was careful in its language on ongoing energy and economic cooperation; however, it will be highly unlikely for the government to proceed with negotiations for the pipeline with the Russian leadership. 

US openly against the Turkish Stream

Another important factor is Turkey’s hardening position against the Russian annexation of Crimea and further aligning its stance with its NATO allies. At a moment when all allies are discussing ways to counter and deter a Russian threat in Eurasia and the Black Sea, Turkey’s pipeline deal would only strengthen the hands of those who question Turkish membership in NATO. 

This point was very openly put by Washington, as U.S. Ambassador to Turkey John Bass told diplomatic correspondents in Ankara on May 4. “We continue to believe that it is important for all of us to sustain pressure, economic pressure, on the Russian government as part of our effort to persuade the Russian government that it faces a very real choice in Ukraine,” Bass said. “But that is a choice that the Russian Federation faces and until it makes that choice, obviously all of the members of the alliance including Turkey will continue to face some economic sacrifices as a result of that,” he added. 

But he was more specific when it comes to energy. “With respect to energy, we believe strongly that the provision of energy supplies, the distribution of energy, particularly oil and gas, should not be manipulated to increase political pressure on individual countries. And our approach to South Stream and our approach to any possible successor pipelines that Gazprom seeks to negotiate will be viewed very much through that prism and from that fundamental principle. And we do not want to see development of gas infrastructure in Europe that increases the dependence of individual countries on one sole supplier,” he said. 

Turkey-EU in strategic energy dialogue

Another important development since Turkey and Russia initially agreed on the pipeline is the launch of the Turkey-EU High Level Energy Dialogue and Strategic Energy Cooperation, a new mechanism to boost cooperation and therefore bring about a more coherent partnership between the two parties. Having the objective of reducing the European continent’s dependency on Russian gas, the EU is – although very belatedly - now trying to seek ways to increase Turkey’s role as a transit country between the source countries and the markets. Of course, at this very point, removal of the political blockage on the opening of the energy chapter will be very helpful and meaningful for providing a better and sound dialogue. 

TANAP becoming a key project

On March 17, Turkish, Georgian and Azeri leaders came together for the groundbreaking ceremony of the $10 billion TANAP pipeline that would carry Azeri natural gas to Greece and Italy through Turkey. Turkish leaders have openly announced TANAP as their priority in a move to ease the concerns of Azerbaijan. In fact, TANAP is seen as the central link between the Caspian and European market and regarded as having vital importance for the EU’s and Turkey’s security of supply and for the realization of the Southern Gas Corridor. 

Turkish Energy Minister Taner Yıldız told reporters on May 4 that Turkey and its partners in the TANAP project will hold talks with “one or two” foreign companies for possible partnerships, making it clear that the project is drawing international attention.  Azerbaijan state company Socar holds a 58 percent stake, while Turkish pipeline company Botaş currently has 30 percent and BP has 12 percent. 

All these elements indicate it will be difficult for Turkey to conclude the deal with Russia for the construction of a new pipeline at the expense of angering Western allies and Azerbaijan, as well as Turkish public opinion. Unless the political framework in the region and on an international scale, as well as Turkey’s energy priorities, will not change, the feasibility of the Turkish Stream seems to be weak.