TANAP inaugurated

The 16bn cm/y Trans-Anatolian Pipeline (TANAP) in Eskisehir, Turkey, part of the $38bn Southern Gas Corridor project, has been inaugurated on time and under budget.

Speaking ahead of the pipeline’s inauguration on 12 June 2018, Alasdair Morrison, Research Analyst, Caspian and Europe Upstream, Wood Mackenzie, said: ‘Since its approval in 2013, TANAP has been transformed from a strategically necessary but commercially questionable pipeline into a fast-tracked development with acceptable standalone economics… TANAP is a world-class example of cost savings. Its current budget of $8bn in 2018 terms is a 32% decrease from the initial $11.7bn estimate. This is thanks to a combination of good timing – contracting in the commodity and currency downturn – and best practice in an established pipeline corridor.’

The launch of TANAP's 56-inch diameter eastern section, known as Phase Zero, is just the start of the Southern Gas Corridor commissioning process. Commercial operations on the line to Eskisehir will begin on 30 June, marking first offtake under Turkey's gas sales agreement (GSA) for Shah Deniz phase two volumes.

The western 48-inch leg of the pipeline which runs to the Turkey-Greece border, is also well advanced and will complete in 2019. This will enable Turkish offtake in Thrace and onward delivery of gas from Shah Deniz into the Trans Adriatic Pipeline (TAP) from 2020.

Morrison continued: ‘TANAP’s commissioning is a giant leap towards Turkey's ambition of becoming a gas transit hub. Together with flows from TurkStream, it will increase the amount of gas passing through Turkey to Europe by around 26bn cm/y by 2023.’

Turkey will be the key gateway for new Azeri and diverted Russian gas into southern Europe. Nevertheless, TANAP expansion will be needed for the region to materially reduce its dependence on Russian gas, according to the market analyst. Yet TANAP's importance to Turkey is far more than just its transit role from 2020. For Turkey's own market, it brings new volumes from a very reliable partner and, crucially, into areas of high demand.

After its three-year ramp-up, TANAP will deliver 6bn cm/y of Shah Deniz gas to Turkey – more than 10% of the country’s gas demand.

Photo: TANAP