The TurkStream natural gas pipeline project is one of the most important strategic projects between Turkey and Russia, which will be the basis of long-term cooperation between Russia and Turkey, Russian Energy Minister Alexander Novak said yesterday.
"Turkey becomes a natural gas bridge for southeastern Europe with the TurkStream project," Novak told Anadolu Agency (AA) in an exclusive interview ahead of Russian President Vladimir Putin's visit to Turkey today.
President Recep Tayyip Erdoğan will host President Putin in Istanbul today for the completion ceremony of the sea section work for the TurkStream natural gas project.
TurkStream consists of two lines from Russia to Turkey, with a total capacity of 31.5 billion cubic meters (bcm). The first line will carry 15.75 bcm of gas to Turkey and the second line will transfer the gas to Europe via Turkey.
TurkStream is a transit-free gas export pipeline that will stretch across the Black Sea from Russia to Turkey and further extend to Turkey's borders with neighboring European countries.
The first line is intended for gas supplies to Turkish consumers, while the second will supply gas to south and southeastern Europe.
Russian energy giant Gazprom plans to start construction of the overland section of TurkStream's second gas pipeline in 2019. Natural gas transmission will take around 52 hours from Anapa, Russia, to Kıyıköy in Kırklareli province in northwestern Turkey, according to officials. "We evaluate several routes for [the second line of] the project, such as Bulgaria, Serbia and Hungary as well as Greece and Italy," he said. Such projects will be the basis of long-term economic cooperation between the two countries, Novak added.
The two countries cooperate on new energy projects, including TurkStream natural gas pipeline and the Akkuyu nuclear power plant, Turkey's first nuclear energy project.
Ankara and Moscow also try to bring a peaceful end to the Syrian conflict, which has claimed hundreds of thousands of lives in a brutal civil war and pushed millions of refugees to neighboring countries as well as to Europe.
The newfound partnership in different areas, including security between Russia and Turkey, facilitates the groundwork for closer trade ties such as the TurkStream natural gas pipeline project.
Akkuyu nuclear power plant
"The [Akkuyu nuclear power plant] project is currently fully funded by Russia. However, we want to attract Turkish investors to the project," the Russian minister said.
"The participation of Turkish companies in the project will diversify mutual investments while improving relations between our countries. At the same time, our Turkish partners will have experience in the implementation of such projects," he said.
Russian State Nuclear Energy Agency Rosatom and other participants will build Akkuyu plant, consisting of four units, each with a capacity of 1,200 megawatts.
The plant will have 8,000 hours per year and produce 35 billion kilowatts of electricity at full capacity, meeting about 10 percent of Turkey's electricity needs.
The plant has an operational start date for the first reactor in 2023, while the plant is expected to be up and running at full capacity by 2025.
Trade volume between Turkey and Russia has increased lately, the Russian minister added.
"One of the main goals of our economic institutions is to increase our trade and mutual investments. This year trade volume between the two countries increased by 26 percent," he explained. "It's not just exports from Russia to Turkey, also Turkey's exports to Russia increased. Our exports to Turkey increased by 24 percent compared to the same period last year and our imports from Turkey increased by 36.6 percent compared to last year," Novak said. Novak also pointed out that cooperation between the two countries in the field of agriculture has increased significantly. The minister said that using national currency in trade between the two countries is very important and added, "This is also one of the main agenda items of our leaders."
"In our bilateral trade, we were told to increase the use of the Turkish lira and the Russian ruble. We are developing our financial systems to reduce risks that may arise due to international restrictions," he said.
"While the use of national currency for Russia's exports to Turkey amounted to 12 percent, this rate reached 40 percent in Turkey's exports to Russia. Meanwhile, transactions on the Moscow Stock Exchange with the Turkish lira have begun. Our central banks and ministries will take necessary steps in this regard and we will continue these efforts," Minister Novak said.
Novak also commented on U.S.' "repressive policies" concerning natural gas toward Europe, especially Germany, and said that this approach is against free market rules. The U.S. continues to use political instruments to pressure countries but consumer countries should reach a final decision on their own for their natural gas needs, he said.
"The European market is a market with a diversity of suppliers. We think that the delivery of gas by pipelines is more reliable. We also saw in recent years that Russia is the only source of extra supply in extremely cold seasons," Novak said. On U.S. sanctions against Iran, Novak said: "We will not cut off cooperation with Iran. We don't recognize the sanctions imposed without the approval of the United Nations Security Council. We will continue to use mechanisms to continue our cooperation, including trade with national currencies. One of the easiest solutions is to use national currencies in trade."