Turkish Energy firm’s Plans for Iran could boost Rouhani

But it is not clear whether signature projects such as the one by Unit International could lead to closer energy cooperation between Ankara and Tehran, boost Turkish-Iranian trade and break Turkey’s addiction to Russian gas.

Volkan Emre, an international energy expert and founder of the World Energy Security Analysis Platform in Washington, is cautious. Emre told Al-Monitor, “Although Turkey and Iran are trying to improve their energy ties despite all odds, given external factors and the dynamics between the two states and Turkish and Iranian private corporations, it is hard for Turkey to obtain a bigger slice of the Iranian [hydrocarbon] pie.”

One primary difference between the two countries, Emre pointed out, is “Iran’s wish to export liquefied natural gas [LNG] to Asian markets, especially India, and Turkey’s desire to buy gas on the cheap through pipelines.”

He said the bigger problem is the poor state of Iran’s energy infrastructure. He said Iran’s major energy infrastructure issue is developing “its production capacity, an area in which Turkish companies cannot offer much. Indian, Chinese, German and French firms can and will grab a piece of that pie — even US companies that specialize in LNG are seeking to enter Iran.”

Emre points to an even bigger challenge forecast by the Turkish economist and energy expert Fatih Birol, the executive director of the International Energy Agency. Birol recently said, “Massive quantities of LNG exports [are] coming on line while demand, despite lower gas prices, continues to soften,” adding that global LNG capacity will increase 45% by 2021, further decreasing prices.

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