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Turkey’s private gas importers hit by Russian cut home

Reuters, Friday January 16 2009

ISTANBUL, Jan 16 (Reuters) – Gas imports by the Turkish units of Gazprom and Royal Dutch Shell , the only two non-state importers, were halted when Russian gas stopped flowing last week, company officials said on Friday.

Imports of Russian natural gas could take days or weeks to resume, said Tugrul Erkin, general co-ordinator of Bosphorus Gaz, which is owned by Gazprom, Russia’s main gas exporter, and Turkey’s Tur Enerji. The company began importing the fuel for the first time on Jan. 3.

“I’m not hopeful it will be anytime soon,” Erkin told Reuters. “It’s no longer a commercial issue but a political dispute between Russia and Ukraine.”

Russian supplies to Turkey and eastern Europe dropped last week because of a row over pricing with Ukraine, through which a western trans-Balkan pipeline crosses.

The two companies’ buying contracts specify that they can only purchase gas through the western pipeline.

Turkish Energy Minister Hilmi Guler said on Thursday it was unclear when Turkey would begin receiving the gas again from Russia, its main supplier.

Shell, which began importing Russian gas a year ago, is also unable to procure the fuel since flows were cut on Jan. 6 and the managing director of Shell Enerji AS told Reuters he was unable to say when they would resume.

Bosphorus has a contract with Gazprom for an annual 750 million cubic metres of gas imports, and Shell’s is for 250 million cubic metres. Two other Turkish companies won import contracts at a 2005 tender, but have yet to begin purchases.

The customers of both Shell and Bosphorus are power plants, which have had to suspend production, Erkin and Comert said.
The purchases by the two non-state importers are part of Turkey’s efforts to liberalise its wholesale gas market. Previously all gas imports were controlled by Botas, the state-owned pipeline operator.

Russia sends about 23 billion cubic metres of natural gas to Turkey every year. Flows are continuing on the Blue Stream pipeline, which bypasses Ukraine by traversing the bottom of the Black Seas to Turkey.

(Editing by Anthony Barker)

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