Turkey’s Energy Policy towards Becoming an Energy Hub: Internal and External Challenges


Turkey’s Energy Policy towards Becoming an Energy Hub: Internal and External Challenges


Owing to its strategic geographical location, Turkey is a very important player in the energy security of Europe. Using this opportunity, Turkey has a cherished desire of becoming an energy hub. Turkey is open to let any pipeline through its own territory to achieve this goal. With this aim Turkey not only seeks to ensure its own energy security and receive revenue from pipeline projects as a transit country but also one may assume that such kind of strategy could allow Turkey to open an energy chapter in the European Union (EU) negotiations and accelerate accession to the EU. However, because of some realities such as the competing pipelines supported by Turkey, political instability in the Caspian region, South Caucasus and Middle East, and the importance of the interests of the great powers such as Russia and Iran Turkey should not only believe in its own resources, it should also take some other factors into account as well.  Taking all these factors into consideration it is not for certain that Turkey will become an energy hub in the near future.


Turkey’s favorable geostrategic location as the bridge to Europe, Central Asia, and the Caspian Sea has historically been very advantageous for Turkey, as it has previously made Turkey the gatekeeper for goods moving westward. Today, the situation is the same and especially for Turkey alongside its raising economic and political power Turkey with its central location is an important energy transit country for oil and natural gas going to the energy-hungry European Union (EU) from Middle East, the Caspian Sea, Central Asia, and Russia because it is located between hydrocarbon consumers and suppliers.

In this regard, Turkey can use an energy strategy to achieve its foreign policy aims towards these regions. Therefore, Turkey’s geopolitical position as an energy transit country can be used as a tool to promote its foreign policy objectives by supporting any possible pipeline projects passing through Turkey, especially those that connect its territory with European consumers. Given the fact that today in geopolitical competition for power pipeline routes have become a major factor that gives leverage and economic advantage, in this regard, the geostrategic location of Turkey gives it such an opportunity (Coşkun and Carlson, 2010). Although Turkey does not have energy resources of its own, “having control over energy transport corridors could be almost as essential as having control over energy supplies themselves” (Tekin/Walterova, 2007, p.84). Thus with lack of energy resources of its own Turkey is able to be as important as energy-rich countries politically and economically given its centrality.


According to Turkey’s Energy Strategy, the ultimate aim of Turkey is to promote its own energy security. For this purpose, Turkey has to set the objective to diversify its energy supply routes, source countries, and contribute to Europe’s energy security. By setting these objectives together with its foreign policy ambitions provided Turkey with the goal of becoming an energy gateway to the European Union. To promote this aim of becoming an energy hub, Ankara has permitted the construction pipelines and its supporting infrastructure within its territory.  Thus these pipelines are the integral elements of Turkey’s energy strategy because Ankara has gained revenues from transit tariffs and regional influence through the control of these energy routes (Hill 2004, p.213).

The main component of the East-West Energy Corridor is the Baku-Tbilisi-Ceyhan (BTC) pipeline, which is a crude oil pipeline system that extends from the Azeri-Chirag-Guneshli (ACG) field through Azerbaijan and Georgia to a terminal at Ceyhan. It has been operating since 2006 and has the capacity of 1 million barrels per day, and at 1760 kilometers is the second longest of its kind in the world. As of 15 October 2012, over 1.5 billion barrels of Azeri oil were loaded onto tankers from Ceyhan and shipped to European markets (Ministry of Foreign Affairs of Turkey, 2012). The second component of the East-West Energy Corridor is the South Caucasus natural gas pipeline which has been operational since 2007 and transports gas from the Shah Deniz field of the Caspian Sea in Azerbaijan, through Georgia to Turkey. This pipeline has the capacity of 6.6 billion cm gas. Turkey supports all Southern Gas Corridor projects passing through Turkish territory. In 2009, an intergovernmental agreement was signed in Ankara between Turkey, Bulgaria, Hungary, Romania, and Austria. According to this agreement, natural gas had to be transported through the planned Nabucco pipeline. It was a major step towards decreasing the EU’s dependence of energy on Russia. The pipeline was supposed to carry Azeri, Turkmen, Iraqi, and Egyptian gas to Europe via Turkey; however, there was no agreement between the shareholders on the funding and tariffs. According to Mehmet Sheflek (2009), giving a start for the Nabucco project in 2009 was a significant step for transforming Turkey into a strategic energy distribution point”.

In 2009, Russia signed a protocol with Turkey routing the pipeline called, the South Stream, through the Turkish territorial waters which was a rival to Nabucco. As Russia has been having problems with Ukraine, the pipeline should have passed through Turkey and the Black Sea. However, there were contentions about Turkey’s assistance to Russia for letting the pipeline pass through Turkey’s soil and its loyalty to the Nabucco project, as the South Stream was a rival to Nabucco.  These facts clearly show Turkey’s aim because Ankara supports any pipeline project passing through its territory. Moreover, on June 28, 2012 was a watershed moment for Azerbaijan and Turkey, as both governments signed the final agreement to establish a consortium for the implementation of Trans-Anatolian Gas Pipeline (TANAP). It sets the stage in energy history of both countries as well as Europe; officially opening the coveted “Southern Gas Corridor” to the EU states. The pipeline with estimated cost of 7 billion USD will transport 16 bcm of gas annually from Azerbaijan through Georgia to Turkey, and the greatest amount of the gas will be delivered to Europe. With this pipeline, Nabucco was replaced with Nabucco West and another transport route called TAP (Trans Adriatic Pipeline) was also proposed as a project that will join TANAP to carry Azeri gas to Europe. On June 28, 2013, The Shah Deniz Consortium chose TAP over Nabucco West as an energy route to Europe via Turkey.  These pipeline projects further demonstrate that Turkey is striving to become an energy hub. There is a lot of literature that reveals Turkey’s aim of becoming an energy hub in future, but this paper will try to show that whether it is possible for Turkey to become an energy hub. Are there obstacles for Turkey’s ambition of becoming an energy hub? Moreover, the paper will also approach to the issue from a different aspect i.e. Turkey’s energy strategy as a part of the EU accession negotiations. How can Turkey’s energy policy affect to its negotiations with the European Union?

Why does Turkey want to become an energy hub? It is because of both domestic issues and achieving foreign policy aims.  Turkey’s energy strategy puts forward the aim of achieving its own energy security. Turkey is an energy-poor country and alongside that its energy demand is rapidly increasing. Today, Turkey imports 70 percent of its oil and gas; Russia and Iran are its top suppliers. According to the U.S. Energy Information Administration (2013), over the last two years, Turkey has seen the fastest growth in energy demand in the OECD. Additionally, energy usage in Turkey is expected to double over the next decade. Therefore, Turkey is open for any pipeline through its own territory to provide a domestic energy supply and to diversify energy sources in addition to receiving revenues from those pipelines. Combined with domestic issues, there are foreign policy objectives as well. Using energy as a tool, Turkey is trying to become an active regional actor.

Is there any Link between Turkey’s Energy Strategy and Its Goal of Joining EU?

After becoming a republic in 1923, Turkey started to have a Western-oriented foreign policy. Turkey became an associated member of the EU and it has conducted political and economic reforms for becoming a full member of the European Union since 2000. This process of “Europeanization” has had a great impact on Turkey’s foreign policy. In this regard, Turkey’s ambition of becoming an energy hub between Asia, the Middle East and Europe does not represent a shift eastwards; instead, it wants to provide energy security and diversification of energy to the EU in order to strengthen its negotiating chips towards becoming an EU member (Dimitrios/Eleni, 2010). According to Turkey’s energy strategy, “Turkey believes that the opening of the energy chapter will surely pave the way for negotiations with the EU on Turkey’s membership to the Energy Community” (MFA, 2012). Turkey enhances its position in the West by increasing its influence in the region to prove itself as a reliable and attractive partner for the U.S. and the EU.  All the pipelines that Turkey agrees to are providing the EU’s energy security. In this sense, according to the Ministry of Foreign Affairs of the Republic of Turkey (2009: 6), “Turkey’s objective is to become Europe’s fourth main artery of energy supply following Norway, Russia and Algeria’, which ‘will open a new avenue for cooperation between Turkey and the EU”.

The EU is highly dependent on external sources of hydrocarbons to meet its domestic demand. According to calculations by the EU Commission (2010: 13), the EU’s import dependency on oil in 2007 was 82.6%, and on natural gas 60.3%. It is estimated that demand for natural gas in the EU will increase by 14%-23% until 2030 and its dependence on imports of gas will be nearly 70% (Eurogas 2010: 2, 9). Therefore, Brussels has included the topic of gas supply security in its energy policy. The EU mainly imports its gas from Russia, but Russia’s use of energy as a “weapon” for political leverage over the EU makes Russia a non-reliable partner for the EU and it makes the EU seek out other possible sources of natural gas such as Azerbaijan, Turkmenistan and the Middle East. However, the routes from these countries are limited; all routes cross Turkey’s territory. Thus, Turkey plays a major role in the EU’s energy security in this context. Moreover, Turkey’s access to Black Sea and the Mediterranean Sea gives it an opportunity of controlling the passage through the Bosporus and the Dardanelles Straits. Furthermore, the recent dispute between Russia and Ukraine has forced Russia to build its pipelines through Turkey, too.  Therefore, Turkey can use its favorable position as a transit corridor for energy resources to get the role of energy hub by controlling gas inflows from Azerbaijan, Turkmenistan, Iran, Iraq, and Russia. In this sense, the EU officially stated in the 2004 Progress Report on Turkey that “Turkey will play a pivotal role in diversifying resources and routes for oil and gas transit from neighboring countries to the EU” (European Commission 2004: 116).

Turkey thinks that the pipelines that pass through its territory will place it in a privileged position in regards with its relations with the EU to negotiate other matters in its favor. In this sense, it has been officially stated that ‘Turkey has also started talks with the EU on Turkey’s membership to the Energy Community in September [2010]’ (Ministry of Foreign Affairs 2011: 4). Ankara believes that the opening of the energy chapter will “pave the way for the success in negotiations with the EU on Turkey’s membership to the Energy Community” (Ministry of Foreign Affairs 2011: 4). During Nabucco negotiations, the government expressly stated that it would participate in the project if only the progress of the energy chapter was possible in the EU accession talks (Krauer, 2011). In this regard, Prime Minister Erdoğan said in 2009: “[i]f we are faced with a situation where the energy chapter is blocked, we would of course review our position [on Nabucco]” (Vucheva 2009). Thus, there is a link between energy and Turkey’s foreign policy aim of joining EU. Turkey hopes that it could use energy as a tool to gain political influence in its relations with EU.

Can Turkey Become an Energy Hub? Internal and External Challenges

Although literature speaks positively about the possibility of Turkey becoming an energy gateway, there are some challenges. One example is the competition between different pipelines supported by Turkey, the political instabilities in the region, and internal instability and problems.  These obstacles together with other geopolitical dynamics and the strategic calculations of other regional actors can impede this process.

First of all, the pipelines supported by Turkey are good enough to ensure Europe’s energy security, however, these pipelines are competing with each other and without all of them Turkey could hardly achieve its ambition of becoming an energy hub. The remarkable examples of these pipelines are Nabucco (which was later called Nabucco West) and South Stream. With the inconsistent policy of Turkey and some other misunderstanding between the shareholders the Nabucco pipeline was not realized and the TANAP project was replaced with Nabucco West which can carry for now only Azeri gas to Europe, however, Azerbaijan alone does not have a sufficient amount of gas to be exported to Europe. Nabucco was the most important pipeline project for Europe to meet its energy demand and to decrease its dependence on Russian gas however; it is no longer a planned pipeline. Without the initial Nabucco, Turkey is unlikely to become an energy hub. According to Carlson (2010): “there is a lack of coherent strategy on the part of Turkey as the government is looking at short-term objectives such as trying to increase the speed of EU accession negotiations, negotiate a low price for Azerbaijani gas, and to keep on good relations with Russia.”

Turkey’s domestic energy consumption is constantly increasing as indicated above. Thus, meeting domestic demand and re-exporting oil and gas to Europe there should be enough pipeline capacity across Turkey to carry the Caspian and Middle Eastern gas to Europe. Therefore, incoherent energy policy between rival pipelines hampers this process. For example, TANAP will carry only 16 bcm gas and 6 bcm will be used for fulfilling Turkey’s internal demand and the rest will go to Europe by the TAP. 10 bcm is not sufficient enough to meet Europe’s demand.

Another domestic challenge is that there was could still be political instability in the Kurdish region in the southeast which disrupts the transportation of oil and gas. For example, in 1996 the Kurdish Worker’s Party’s (PKK) leader, Abdullah Öcalan, stated that they “would not permit any pipelines from the Caspian to run across Kurdish territory” (Hill, 2004, p. 231).  As a proof of that we can name the bombing of the BTC which caused the shutdown of the pipeline for almost a month, there were again two explosions along the BTC pipeline which resulted in an estimated 1.5 billion USD operational loss (Eissler, 2012), moreover, there was terrorism and sabotage along the Kirkuk-Ceyhan pipeline in the last ten years. As most important pipelines are crossing the regions where PKK is active, it is not a reliable route for Europe to transport gas. Although there have been new developments between PKK and the government towards peace, unknown militants have bombed a section of Kirkuk-Ceyhan pipeline carrying Iraqi crude oil from the northern city of Kirkuk to Turkey’s Mediterranean port of Ceyhan (Press TV, 2013). It is unclear now as to what will happen in the region with the recent peace process underway, but it seems this region remains a potential target and volatile area.

The external challenges are that the Caspian region and the Middle East are not stable either. These are the only energy sources that can diversify Europe’s energy routes. However, the ongoing Karabakh conflict makes Azerbaijan a risky investment because the pipelines are near the border with Armenia and if a war would start between the two countries, the pipeline’s security would be in question. Moreover, the Abkhazia and South Ossetia conflicts are also a factor that threatens the security of the pipelines passing through Georgia. The situation is the same in the Middle East as well given there is too much political instability in that region, especially in Syria. Possible regime changes in those Middle East countries will affect Turkey’s friendly relations with them. So, the energy sources that Turkey is relying on and wants to use for transport to Europe are not politically stable. Furthermore, recently Israel has claimed that it has big amount of gas reserves and wants to cooperate with Turkey on transporting its gas, however, such kind of pipeline should cross Cyprus territory and as Turkey has not recognized Cyprus, it is unlikely that such a project could happen.

Another external challenge in the Caucasus and Middle East is that other powerful actors also have interests in these regions, especially Russia and Iran. Russia has political leverage on Kazakhstan and Turkmenistan because it tries to buy energy of these states in order to prevent the Caspian gas to be transported to Europe. Its political leverage is only less on Azerbaijan, as Azerbaijan is in the eastern part of the Caspian Sea, but Azerbaijan alone cannot provide Europe’s energy security. One of the reasons why Nabucco was not realized is that it was supposed to carry Turkmen gas via the Trans-Caspian pipeline; however, as the legal status of the Caspian Sea has not been resolved yet, Iran and Russia have not permitted the construction of any seabed pipeline in the Caspian. Moreover, Iran aims to consolidate its status in Central Asia by transporting energy sources of that region through its own territory to the international markets. As Iran offers the most competitive transportation route for Caspian oil to world markets, it poses a challenge for Turkey’s ambition to be an energy hub (Hill 2004: 232). When Iranian interests are on stage, Turkey is vulnerable in terms of maneuvering, as Iran has more leverage on the Caspian Sea than gas pipeline proposals.  Turkey’s strategic location and its resources are not sufficient to realize so many pipeline projects, in addition to this, the interests of the regional actors are also important to consider.

Conflicting Pipelines and Domestic Terrorism: A Challenging Road Ahead

Turkey’s geographic location gives it the privilege to provide Europe’s energy security, although, it does not have energy resources of its own. In this regard, the above mentioned pipeline projects that Turkey joins to cross through its territory shows that Turkey aims to become an energy hub. The reasons behind this energy strategy are multi-dimensional. Besides receiving revenue from transporting this energy to Europe, Turkey wants to become more active in the region through making energy as a tool, but one factor that is more important is if Turkey can accelerate its accession to EU by opening energy chapter in its negotiations with EU. This condition was put forward in Nabucco negotiations. However, Turkey’s energy strategy can face some serious problems both internally and externally because Turkey’s energy strategy is not consistent as it supports rival pipelines and domestic energy demand is increasing. Moreover, the political problems with the PKK and the Cyprus issue also challenge its energy strategy. Externally, Turkey supports the pipelines which come from politically instable regions namely the Caspian and the Middle East where there are ethnic conflicts and political unrest. Besides, the interests of regional actors such as Russia and Iran do not coincide with the aim of Turkey as those states have strong leverage over the Caspian and this leverage puts the ambition of Turkey to become energy hub under suspicion. Nevertheless, Turkey should also calculate geopolitical dynamics and the interests of others such as Russia and Iran in its energy strategy by not only relying on its own resources.

Narmin Jarchalova, Azebaijan Diplomatic Academy
Please cite this publication as follows:
Jarchalova, Narmin (September, 2013), “Turkey’s Energy Policy towards Becoming an Energy Hub: Internal and External Challenges”, Vol. II, Issue 7, pp.15-22, Centre for Policy and Research on Turkey (ResearchTurkey), London, Research Turkey. (http://researchturkey.org/dev/?p=4073)


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Narmin Jarchalova
Narmin Jarchalova
Narmin Jarchalova | Azebaijan Diplomatic Academy - Azerbaycan Diplomasi Akademisi


  1. Türkiye’nin “Enerji Dağıtım Merkezi” olması şu nedenle mümkün görünmüyor:
    Enerji dağıtım merkezi olmak için enerjinin nihai alıcılara kendi topraklarında teslim edilmesi, piyasasının da yine kendi topraklarında oluşması gerekir. Halen BTC (Bakü-Tiflis-Ceyhan) ve Kerkük-Yumurtalık Ham Petrol Boru hatları dışında, Türkiye alıcılara kendi topraklarından yükleme yaptığı bir hatta sahip değildir. Sözü edilen bu iki hattın da nihai ticaretinde hiçbir söz hakkı bulunmamaktadır.
    Türkiye ancak “Enerji Transit Ülkesi” olabilir. Artık gündemden kesin olarak çıktığını kabul etmemiz gereken NABUCCO ve gündemdeki TANAP (Trans Anadolu Boru Hattı) hatlarıyla birlikte, bu kimliğe daha yakın bulunmaktadır.
    Asıl soru şudur: Türkiye Enerji Transit Ülkesi olmalı mıdır, ya da hangi koşullarda olmalıdır?
    Türkiye, öteden beri “Jeostratejik önem” için her türlü boru hattı projesine aşırı istekli görünmektedir.
    Oysa Jeostratejik önem kırılgandır; her an yeni alternatifler ortaya çıkabilir ve önem “önemsizliğe” dönüşebilir.
    Diğer taraftan, boru hatlarının transit ülke için yarattığı riskleri de göz ardı etmemek gerekir. Deniz ve kara alanlarının, tarım topraklarının, havanın kirlenmesi; bitki ve hayvan varlığının zarar görmesi çevresel risklerdir. İşletme olumsuzluklarından kaynaklanan tazminat riskleri de olabilir. Paramiliter grupların sabotajlarına da maruz kalınabilir. (Bunların tümü belli ölçülerde olmaktadır bugün) Hatların ekonomik ömürleri sonunda yüz binlerce tonluk çöp yığınının kaldırılması mümkün olmayabilir. Uluslar arası sahipli boru hatlarının yapım ve işletilmesi için bazı hükümranlık haklarından vazgeçmek de gerekebilir.
    Bunları, “Transit Ülke olmayalım” diye yazmadım. Tersine,riskleri bilelim diye yazdım.
    Bir petrol veya doğalgaz hattına evsahipliği yapacaksak, yukarıdaki riskler karşılığında şunları elde etmeliyiz:
    – Önce yeterli bir geçiş geliri (ve bunu sağlayacak bir asgari kapasite taahhüdü)
    – Hattan geçeni (petrol-doğalgaz) öncelikli satınalma hakkı
    – Malın nihai ticaretinde söz hakkı.
    – Malın elde edilmesinde (üretimde) ortaklık.
    Bunlar olmadan, belirsiz kapasiteler ve düşük taşıma gelirleri ile “Transit Ülke” olmaya kalkmak, başkasının malına ucuz hamallık yapmaktan farklı olmayacaktır.


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