Turkey 2014 | ENERGY | INTERVIEW

TBY talks to Taner Yıldız, Minister of Energy and Natural Resources, on the key pipelines and other projects that will shape Turkey's energy future.

Taner Yıldız
Before entering politics, Taner Yıldız worked for the Kayseri Electricity Generation Company, where he became a Board Member and General Manager. In 2002 he was elected as a Member of Parliament for Kayseri and served as energy adviser to Prime Minister Recep Tayyip Erdoğan. In May 2009 he was appointed Energy and Natural Resources Minister.

How are international projects such as the Trans-Anatolian Pipeline (TANAP) and the Turkey-KRG pipeline positioning Turkey to become an energy hub?

TANAP is a crucial project both for Turkey and Europe. TANAP is scheduled to carry 16 billion cubic meters (bcm) of gas from Azerbaijan's Shah Deniz II field in the Caspian Sea, one of the world's largest gas fields. Energy-hungry Turkey will receive 6 bcm of natural gas, while 10 bcm, approximately the equivalent of 1.5% of Europe's total consumption, will flow to Europe. The Turkish section of the pipeline will stretch approximately 1,800 kilometers and require approximately 2 million tons of steel pipes. Six of the 18 steel pipe suppliers involved in the project are from Turkey. TANAP will, therefore, create 5,000 jobs across 21 of our provinces. The TANAP project is slated to be operational as of 2018, having created employment in the cities it passes through, as well as for the participating domestic steel pipe manufacturers. Additionally, the Baku-Tbilisi-Ceyhan (BTC) pipeline, the Kirkuk-Ceyhan pipeline, and Baku-Tbilisi-Erzurum (BTE) gas pipeline projects hold great importance in terms of Turkey's status as an energy hub. Likewise, the Turkey-KRG pipeline project holds much promise for Turkey. Dependent on expensive energy imports, Turkey is trying to secure and diversify energy routes to keep its steadily growing economy moving forward. We are determined to become a regional energy hub by leveraging both our strategic and geopolitical position. To this end, we will rapidly continue endeavors toward transportation of Caspian, Middle Eastern, and Middle Asian energy resources to Europe and the world market.

It has been estimated that Turkey's energy sector will require annual investments of $8 billion to $10 billion for the next decade to meet energy demands. How can Turkey increase the investment attractiveness of its energy sector to reach this target?

Turkey is committed to an energy investment of $100 billion over the next 10 years. The Ministry is set to invest over TL1 billion in coal-fired plants within the framework of environmental investment. Moreover, renewable energy is highly important for Turkey and, by 2023, we aim to meet 30% of domestic electricity demand from local renewable energy sources. As the government, we have implemented the necessary legal framework for the energy sector to reach the status it deserves. We would also like to see foreign firms investing in Turkey across the energy spectrum.

What are the Ministry's medium-term privatization goals?

The energy sector saw a successful privatization period in 2013. We completed the sale of electricity distribution services smoothly, whereby Turkey earned $13 billion from the privatization of 21 regional electricity distribution grids in total. In 2014, we will focus on the privatization of electricity generation plants and expect to earn the same level of revenues.

What is your outlook for Turkey's energy sector for 2014 and beyond?

Turkey has enjoyed strong political stability over the past decade and has solid opportunities in the energy sector. Indeed, those keen on investment in Turkey can expect to receive government support.