Turkey to change principles on gas supply agreements

By: Aynur Jafarova

Turkey intends to deviate from a ‘take or pay’ principle in executing gas supplies agreements with Azerbaijan and Iran.

The news was announced by Turkish Energy and Natural Resources Minister Taner Yildiz at a meeting with journalists on April 21, local Turkish media reported.

“We should abandon the agreement on a ‘take or pay’ principle towards Azerbaijan and Iran, as it previously happened with Russia,” he said.

Yildiz went on to stress that Turkey will refuse a ‘take or pay’ principle in its agreements with Iran in 2014 and Azerbaijan in 2015.

“Therefore, Azerbaijan and Iran should ensure gas supplies to Turkey in sufficient volumes,” he noted. “In case of supplying insufficient volumes, they will not be included in this mechanism [take or pay].”

As part of the first stage of developing the giant Shah Deniz gas condensate field, an agreement for the supply of Azerbaijani gas was signed on May 12, 2001, for 15 years.

The agreement envisages the annual supply of 6.6 billion cubic meters of gas to Turkey.

Azerbaijan and Turkey also have a second agreement which envisages the supply of gas as part of the second stage of developing the Shah Deniz field.

It envisages the supply of six billion cubic meters of gas per year. The contract was signed on October 25, 2011, for 33 years, and supplying is expected to begin in 2017-2018.

Turkey and Iran signed an agreement for the annual supply of 10 billion cubic meters of gas on August 8, 1996. The contract duration is 25 years.

Azerbaijan and Turkey’s relations have always been strong due to their common culture and history and the mutual intelligibility of Turkish and Azerbaijani languages.

Turkey was the first country in the world to recognize Azerbaijan’s independence in 1991 and has been a staunch supporter of Azerbaijan in its efforts to consolidate its independence, preserve its territorial integrity, and realize its economic potential that arises from the rich natural resources of the Caspian Sea.

The economic projects implemented between Azerbaijan and Turkey are bringing these countries together and strengthening their cooperation.