ISTANBUL: Turkish power and gas traders were braced for one of the country’s ‘worst energy crisis’, amid fears of supply shortages and soaring demand in the upcoming week.
Companies have raised concerns about a pending shortage of LNG volumes over the next seven days at a time of cold weather-driven spiking demand, uncertain pipeline imports and reduced hydro production.
“This is the biggest energy crisis of Turkey and it appears that next week [the gas transmission system operator and incumbent] BOTAS won’t be able to meet demand even with gas curtailments,” a power trader told ICIS on Friday.
According to latest ICIS LNG Edge data, there are four contract and spot LNG cargoes scheduled to deliver into Turkey. The first delivery was due on Friday, with the 126,000 cbm Mourad Didouche expected to unload at the Marmara terminal.
The next delivery is not until 24 December, when the 177,000cbm LNG Lagos II, a contract cargo from Nigeria, is scheduled to reach the privately-operated onshore Aliaga terminal.
The 146,000cbm LNG Benue, also from Nigeria, is expected to arrive at Aliaga three days later. Finally, the 154,000cbm GDF Suez Point Fortin from Norway’s Hammerfest is due to arrive at Aliaga on 3 January.
Meanwhile, the GDF Suez Neptune, Turkey’s first floating storage and regasification unit (FSRU) which arrived in Turkey earlier this month may not enter operation as yet. The offshore terminal has a daily send-out of 20mcm, bringing more flexibility to the market once operational.
However, for now, traders are concerned that the lack of LNG supplies to the onshore terminals could create a significant crisis next week when temperatures remain below average, with mean anomalies of -2C to -6C in some parts of Turkey.
Turkish power delivery prices have been hovering above TL230.00/MWh (€62.90/MWh) over the last three days, some TL100.00/MWh higher than the daily average delivery price for 2016 to date.
Meanwhile, Turkish gas prices were quoted close to TL770.00/kscm, also nearly TL100.00/MWh above the day-ahead price for gas assessed by ICIS exactly a year ago.
Fears were growing against uncertainty about the availability of Iranian imports amid contradictory information this week. Press reports suggested that volumes may be curtailed as Iran itself was dealing with spiking demand.
However, Iran’s gas company NIGC told ICIS that volumes were within contractual levels of 29mcm/day. Turkey’s BOTAS did not comment by publication time on Friday.Meanwhile, Russian volumes at the western Malkoclar entry point were hovering around 42.1mcm/day on Thursday, after reaching 45.8mcm/day on Wednesday.
A shipper told ICIS that companies were receiving natural gas within the agreed daily contractual quantities from Gazprom, but added that the volumes may be some 5% lower than the current demand.
Another shipper estimated the current gas demand at 220mcm/day, although a recent order to gas-fired power plants to reduce their gas consumption may be saving around 20mcm/day.
