VZCZCXRO7039
RR RUEHAG RUEHAST RUEHBC RUEHDA RUEHDE RUEHDF RUEHDIR RUEHFL RUEHIK
RUEHKUK RUEHKW RUEHLA RUEHLN RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK
RUEHYG
DE RUEHAK #0035 0081551
ZNR UUUUU ZZH
R 081551Z JAN 08
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 4867
INFO RUCNCIS/CIS COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNIRA/IRAN COLLECTIVE
RUEHDA/AMCONSUL ADANA 2586
RUEHIT/AMCONSUL ISTANBUL 3718
RHEBAAA/DEPT OF ENERGY WASHINGTON DC

UNCLAS ANKARA 000035 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ENRG EPET IR TU
SUBJECT: DESPITE IRANIAN GAS CUTS, TURKEY KEEPS THE LIGHTS ON 
 
 
SENSITIVE BUT UNCLASSIFIED 
 
¶1. (SBU) Summary.  In the midst of cold winter weather and snow, 
Turkey is suffering from reduced gas imports from Iran and Russia. 
The GOT is taking several measures to assure that power is kept on. 
In a worse case scenario of bad weather forcing Russia to cut gas 
supplies to Turkey via the West Line, the GOT would be forced to dip 
into its gas storage which could maintain current electricity usage 
for about a month after which black outs would likely occur. 
High-level officials including Prime Minister Erdogan are engaging 
with Iran to bring its gas back online for Turkey.  End summary. 
 
 
Natural Gas Cuts from Iran and Russia 
------------------------------------- 
 
¶2. (U) On January 1, 2008, Iran reduced it gas exports to Turkey by 
75% and on January 7 cut off gas exports entirely.  Press reports 
claim that Turkmenistan reducing its gas exports to Iran gave Iran 
no choice but to reduce exports to Turkey, while the January 7 cut 
was blamed on pipeline dysfunctions due to cold weather.  Russia 
also reduced gas flow through the West Line to Turkey by about 10%, 
also due to bad weather. 
 
Keeping the Lights On Despite Gas Cuts 
-------------------------------------- 
 
¶3. (SBU) According to Energy Ministry Energy Affairs DDG Nilgun 
Acikalin, the GOT is determined to keep the lights and heat on for 
households and industry.  During a similar gas shortage in the 
winter of 2007 also caused by a cut from Iran, the GOT was heavily 
criticized for cutting power to some industrial users.  Acikalin 
said the GOT has taken the following measures to assure gas supply: 
(1) increased purchase of natural gas from Russia via the Blue Steam 
pipeline; (2) increased purchase of liquefied natural gas (LNG) from 
Algeria and Nigeria; and (3) substituted secondary fuels such as 
gasoline and fuel oil for natural gas in combined cycle power plants 
where possible.  Turkey is also seeking addition LNG sources from 
the spot market.  Acikalin said this reduction in gas supply from 
both Iran and Russia highlights the importance of Turkey securing 
diversity of energy resources. 
 
Worse Case Scenario 
------------------- 
 
¶4. (SBU) Acting Energy Under Secretary Selahattin Cimen told the 
press that the daily gas consumption in Turkey was 120-130 million 
cubic meters (MCM) per day, and this amount would likely increase to 
135 MCM/day in bad weather conditions.  Acikalin said the worst-case 
scenario would be a complete gas cut off from Russia via the West 
Line combined with the current cut from Iran.  In such a case, 
Turkey would have enough gas at its storage facility in Silivri 
(700-800 MCM) to maintain current electricity production for one-two 
months before black outs would become necessary.  Press reports 
claim that Turkey's gas storage would only suffice for 15-17 days. 
Acikalin speculated that electricity price increases that took 
effect January 1, 2008 would probably decrease consumption next 
month. 
 
Resolving the Problem with Iran 
------------------------------- 
 
¶5. (SBU) Last week, Cimen traveled to Tehran to discuss the gas 
export contract with Iranian officials.  The Ministry of Energy has 
not released any results from Cimen's trip.  The press reported that 
Prime Minister Erdogan is also expected to talk to Iran President 
Ahmedinejad to resolve this problem.  (Comment:  If the problem with 
Iranian gas is technical, it's not clear how the PM can he helpful, 
however if Iran is seeking a higher gas price from Turkey to 
accommodate Turkmen seeking a higher price from Iran, the PM may be 
able to negotiate a deal.  As Turkey raised industrial and 
residential prices for electricity January 1, it will be difficult 
to pass increased gas costs onto the consumer.) 
 
MCELDOWNEY