Turkish Petroleum Corporation

Turkish Petroleum Corporation - Business Description

4 mai 2009

Global Markets Direct Company Profiles

Anglais

(c)2009, Global Markets Direct.

Overview

Turkish Petroleum Corporation Business Description

TPAO is engaged in hydrocarbon exploration, drilling, production, refinery and marketing business as Turkey's solitary national company. The company offers natural gas storage, and participates in oil and natural gas pipeline projects. It is also engaged in oil trade and transportation of hydrocarbon products.

Currently, the company’s wholly owned subsidiaries are Turkish Petroleum International Company Ltd. (TPIC), Turkish Petroleum Overseas Company Ltd. (TPOC), Turkish Petroleum Btc Ltd. (TPBTC), Turkish Petroleum Scp Ltd. (TPSCP) and Kazakturkmunai (KTM) Ltd. Joint company (Kazakturkmunay).

The company operates through domestic exploration and international exploration activities.

Domestic exploration consists of domestic production, drilling, joint exploration, production, and exploration of offshore fields in Turkiye. The company conducts exploration and drilling activities to determine hydrocarbon potential of new fields such as Pervari (Siirt), Silopi, Erzurum, Bafra, Ayvalik and Yuvakoy (Burdur-Isparta).

During the year 2007, the company drilled 74 wells. The oil discoveries were realized and exploration wells Gokce 1 and Gogeli 1 were drilled in Adiyaman-Gaziantep. Natural gas discoveries in Fidanlik-1 exploration well drilled in Thrace region and Yolacan-C1 well drilled in Siirt were realized. Akcakoca-4, Guluc-1, Alapli-1 and B.Eskikale-1 wells drilled by TPAO-Toreador-Stratic joint venture were completed as gas wells in the year 2007.

In the year 2007, the company produced 10,297,955 barrels of crude oil from its fields. The total production wells of the company were 823 in 2007. In 2007, the company’s total domestic and international oil production reached over 70.000 bpd.

In 2007, TPAO‘s cumulative natural gas production was 421,464,200 sm3. The cumulative hydrocarbon production was realized as 12,777,156 barrels at the end of the year.

The company started many new ventures in the Middle East, Syria, Iran, Iraq, Turkmenistan, North Africa and other countries during the year. Under Onshore, the company operates four joint venture agreements.

In 2006, the company jointly with Toreador produced around 410 thousand barrels of crude oil at the Cendere field (Adiyaman) in South Eastern Anatolia Region.

The company under its joint venture agreement with Perenco to produces oil from Kastel, Karaali and Yalankoz fields in South Eastern Anatolia Region. Further, the company transferred 50% interest in some specific area to Perenco.

The company also operates Western Black Sea Exploration, Production and Development project under partner ship with Toreador and Stratic. In addition the company operates four projects namely Bati Raman field enhanced oil recovery project, Raman field production enhancement project, Bati Kozluca field water alternating gas (wag) project and Garzan field water injection project.

The company conducts its international activities mainly in Caspian Region, North Africa and Middle East. It also carries out its exploration and production activities in Azerbaijan, Kazakhstan and Libya.

In Azerbaijan, the company is engaged in three exploration, development and production projects. These are; Azeri-Chirag-Guneshli (ACG, 6,75%), Shah Deniz (9%) and Alov (10%) projects. In addition, the company has a share of 6,53 % in the BTC Co. and owns 9% share in South Caucasus Natural Gas Pipeline Project, which would transport Shah Deniz gas to Turkey-Georgia border.

In Kazakhstan, the company conducts its activities under a Joint Venture KazakhTurkMunai (KTM) Ltd. in which the company holds a 49% share and KazMunaiGas owns 51%. This joint company owns one concession in Aktau Region and two in Aktubinsk Region. Further, in Libya, the company carries out activities in block NC188, block NC189, 147/3 and 147/4.

Turkey, EU countries sign deal for gas pipeline to reduce European dependence on Russia

ANKARA, Turkey (AP) -

European countries on Monday sealed an important agreement aimed at diversifying the continent's energy sources -- but their pipeline project to bring natural gas from Central Asia and the Middle East to Europe can't entirely break Russia's dominance.

The Nabucco pipeline is still seeking gas supplies -- in particular, from Azerbaijan -- despite promising words by Iraq, Turkmenistan, Egypt and Syria. It may even need Russian supplies to fill its 31 billion cubic meters of capacity -- although Moscow would be likely to be reluctant to ship gas through Nabucco as it competes with rival Russian pipeline projects running to Europe.

The European Union and the United States -- key backers of Nabucco -- say they are confident that gas supplies will now be found after Monday's agreement signed by Turkey and four EU countries -- Austria, Bulgaria, Romania and Hungary -- to allow the pipeline to cross their countries.

The 2,050-mile (3,300 kilometer) projected pipeline would run from the Caspian Sea across Turkey to Austria and involves investments of euro8 billion ($10.26 billion), according to EU data. Still, Nabucco's impact can't end Europe's need for large amounts of Russian gas, as it can carry no more than 5 percent of Europe's consumption.

Moscow, meanwhile, is pushing hard for alternative pipelines to Europe for its own gas -- the so-called "Nord Stream" through the Baltic Sea to Germany and the "South Stream" through Bulgaria.

And there are serious political and structural obstacles ahead for Nabucco.

Russia just two weeks ago clinched a new major natural gas deal with Azerbaijan to buy 500 million cubic meters of gas annually, gas that could have supplied the European effort. Azerbaijan's Energy Minister Natiq Aliev on Monday refrained from any clear commitment to Nabucco. The deal with Russia is small but reveals the influence of Moscow over former Soviet republics.

"We support all directions concerning gas pipelines," he said. "A certain amount of flexibility is required. It's the profitability regarding trade that is important."

Turkmenistan's President Gurbanguli Berdymukhamedov on Friday signaled a desire to break Russia's lock on most of the nation's gas exports since the Soviet collapse in 1991, saying the desert nation has "colossal natural gas reserves," and could support Nabucco.

But to feed Nabucco, Turkmen gas would have to be brought across the Caspian Sea to its western shore in Azerbaijan and there is no existing pipeline. In addition, Turkmenistan and Azerbaijan are at odds over Caspian Sea rights.

Iraq's Prime Minister Nouri Al-Maliki on Monday surprised many by saying "Iraq can provide around 15 billion cubic meters for EU countries via Turkish territory."

Two Nabucco partners are exploring northern Iraq gas fields adjacent to Turkey but the regional Kurdish authority has to work out export details with the central government in Baghdad. Iraq also would need the construction of new pipelines through Syria and Turkey to join Nabucco.

Qatar could export liquefied natural gas to a projected facility in Turkey which can convert it and pump the gas to Europe through the Nabucco pipeline, Turkey's Prime Minister Recep Tayyip Erdogan said.

In an obvious reference to Nabucco, Prime Minister Vladimir Putin said in May that Russia has nothing against alternatives to its planned pipelines but added acidly: "Before putting millions of dollars into a pipeline and burying it in the ground, you have to know where the gas for this pipeline is going to come from."

Alexey Gromov, deputy director of Russia's State Institute of Energy Strategy, said Nabucco pits backers of Nabucco against Russia in a "political struggle."

Russia provides over a quarter of Europe's gas, and 80 percent of that moves over Ukrainian pipelines. By diversifying imports and redirecting some of the Russian shipments through Nabucco, Europe could prevent a repeat of the January crisis in which all deliveries through Ukraine were suddenly cut off because of a price dispute.

The United States and Turkey do not object to Russia's participation in Nabucco as a business partner but Washington says Iran should be excluded until it improves its ties with the West.

The Nabucco would not only make Turkey an alternative energy route between Central Asia and the Middle East to Europe but could potentially enhance Turkey's hand in overcoming EU resistance to letting it join the union.

"I believe that with the arrival of the first gas -- and some experts have said this will be as early as 2014 -- this agreement will open to door to a new era between the EU and Turkey," EU President Jose Manuel Barroso said. "Gas pipes may be made of steel, but Nabucco can cement the links between our people."