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ANKARA: An offer by Russian President Vladimir Putin to establish Turkey as a gas hub for European markets has sparked intense debate over the plan’s feasibility.

The proposal aims to position the TurkStream pipeline as an alternative to Europe’s Nord Stream by exporting more gas through the Black Sea to Turkey.

On Friday, Turkish President Recep Tayyip Erdogan, who recently met Putin on the sidelines of a regional summit in Kazakhstan, said Russian and Turkish energy authorities have already been ordered to start technical work on the proposal immediately.

“There will be no waiting,” he said.

The gas distribution center is to be built in the Turkish region of Thrace on the border with Bulgaria and Greece.

NATO member Turkey, which has not joined Western sanctions against Russia over the invasion of Ukraine, is still heavily dependent on Moscow for its energy needs.

The project can help Europe to face increasing energy challenges ahead of the winter, but some details still need to be resolved in terms of feasibility.

Moscow has already halted Nord Stream 1 deliveries over technical problems, while Germany has rejected a Russian proposal to increase gas flow to Europe through the Nord Stream 2 pipeline in the Baltic Sea.

However, Aydin Sezer, an Ankara-based expert on energy and Turkey-Russia relations, said Moscow’s offer to Ankara should be approached cautiously.

“On the one hand, there is the question of demand at a time when Europe is trying to wean itself off of Russian gas, despite the approaching winter conditions,” he told Arab News.

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“Besides, Turkey has long tried to become an energy hub, but previous projects have always positioned it as a corridor country. It is still unclear whether this proposal will turn Turkey back into a transit-only country for Russian gas,” he said.

According to Sezer, in order to become an energy hub, Ankara should be provided with the means to set a reference price for gas and be able to purchase gas from various sources, including Russia, Azerbaijan, Iraq and Turkmenistan, among others.

“If the gas only comes from one source like Russia, the price will again be set by the supplying country and not by Turkey. Being a hub means being able to set prices and pool alternative energy sources,” he said.

The construction price of such a project can also prove to be too expensive.

The corrosion-resistant steel pipes used in such projects are mainly produced in Germany and China, Sezer said.

Saipem’s own pipelay vessels “are dispatched from Italy. And all these operations will be regulated within the framework of the EU sanctions against Russia after its invasion of Ukraine in February,” said the expert.

Sezer suggested that Russia might consider granting Turkey a re-export license.

It would allow Turkey to trade energy directly with Europe, meaning the gas flow originating from Russia would not be subject to Western sanctions.

According to Soner Cagaptay, director of the Turkey program at the Washington Institute, the proposal fits into the larger picture of growing Turkey-Russia ties against the backdrop of the Ukraine war.

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“Turkey in particular was pro-Ukraine but not anti-Russia. It has supported Ukraine militarily, but it has also maintained its close economic ties with Russia because it required the injection of Russian money into its economy, tourism and direct investment, including oligarch money,” he told Arab News.

In July, Russia’s state-owned Rosatom also transferred billions of dollars to its subsidiary, Turkey’s Akkuyu Nuclear Power Plant, to meet procurement needs.

“Energy is part of this mutually beneficial relationship. Turkey’s position is not ideal for Putin,” Cagaptay said.

“It is important that Turkey offers Russia a market in Europe and in the global economy. The energy hub proposal will therefore give Putin a way out, while being very beneficial to Erdogan economically and politically, as it will tell Turkish citizens that the country is in such a good position to get gas when people in Europe freezes in winter.” Cagaptay said.

It is unclear whether such a gas hub project would trigger a wave of sanctions against Turkey.

However, Cagaptay warned that the US government would likely use its business-to-business ties to persuade Turkish companies to avoid doing business with Russia.

The US Treasury Department sent a letter to Turkish banks and companies in August warning that they would not have access to the US dollar if they traded with Russia under the sanctions regime. The US has also criticized Turkish state banks that had accepted the Russian Mir payment system for credit cards.

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Madalina Sisu Vicari, a Brussels-based independent geopolitical analyst, said Putin’s proposal for the gas hub has two aims: to increase geoeconomic interdependence between Russia and Turkey and to preserve part of the European market for Russian gas.

“Russia’s gas exports to its main market, Europe, have fallen dramatically since the war began, and they will continue to fall,” she told Arab News.

“Furthermore, the gas transit contract between Russia and Ukraine ends in 2024,” Sisu Vicari added.

“Nonetheless, with both sides already at odds over payments and arbitration, and more importantly, given a new geopolitical reality brought about by the war, it seems impossible to see a new gas deal between Russia and Ukraine after 2024 said Sisu Vicari.

Therefore, Moscow will have huge amounts of gas with no export market target, she added.

In his recent meeting with Erdogan, Putin said: “If Turkey and potential buyers in other countries are interested, Russia can build another gas pipeline and set up a gas hub in Turkey for trade with third countries, first and foremost, of course, with European countries.” , consider , but only if interested.”

Sisu Vicari said that the feasibility of the project “depends on the willingness of EU countries to continue buying Russian gas next year and to buy it through Turkey”.

She added: “Such a decision will be mainly shaped by the interplay of geopolitical factors, namely the outcome of the war in Ukraine, post-war relations between the West and Russia, and relations between Turkey and the EU.”


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