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Black Sea oil exploration costs top $4 billion
According to TPAO General Manager Mehmet Uysal, a further investment of $50 billion to $60 billion will be required to start oil extraction if the exploration yields positive results.
In an interview with the Anatolia news agency on Thursday, Uysal recalled TPAO’s earlier expectations that reserves lying deep in the Black Sea would meet Turkey’s oil and natural gas needs for 40 years. “We believe there are 10 billion barrels of oil and three trillion cubic meters of natural gas in the Black Sea,” Uysal said. He said exploration is over and it is now time to drill. Each of the 10 planned wells will cost an average $250 million to drill, adding up to a considerable sum, Uysal said, noting, however, that the real spending will take place once production starts. “Considering that Turkey is already spending a fortune of $30 billion on oil and gas purchases, the cost of the investment will be made up in two years,” he said.
Drilling is required to prove potential oil and gas reserves, he said, adding that TPAO is planning to drill a new potential site in the Black Sea every six months. “The first proof will be in July after the drilling with the Leiv Eiriksson platform. If all the drilling ends with no result, we will have to admit that we misinterpreted the data and that there isn’t the potential we expected. Otherwise, we will say there is oil or natural gas potential in the drilled location,” Uysal explained. He said the Leiv Eiriksson, which is one of the largest drilling platforms in the world, is currently working off the shores of Sinop, and after completing its job there, it will set sail to Zonguldak and Trabzon. It is expected to complete the drilling studies in three years.
The TPAO general manager said they also believe there is significant oil and natural gas potential in the Mediterranean. The seismic exploration there will continue this year to ascertain exactly how much potential reserves exist beneath the sea, Uysal noted, adding that TPAO will conduct the exploration through agreements with international oil companies, which have far greater experience and access to high-tech instruments. Asked whether the Mediterranean has as much potential as the Black Sea, he said it has “even more.”
‘We are preparing for
exploration tenders in Iraq’
Noting that they are closely watching for partnership opportunities for oil exploration in Iraq, Uysal said the TPAO is currently in talks with an international company that had secured a contract for a large oilfield in Iraq. He declined to reveal the name of the company. He also recalled that the Iraqi government had canceled a tender on operating rights for the Akkas oilfield as TPAO was the only bidder. However, Iraq decided to put it on the auction block again, Uysal said, noting that TPAO had bid again on operating rights for the field, this time in cooperation with Italian energy company Edison. “If the sides can reach an agreement, we, as the consortium, will undertake the operation of the Akkas field, too. This is an important development,” he noted.
Uysal said the company has no intention of constructing a refinery on a large field it recently bought in İskenderun. The company may, however, allocate this land to the construction of a refinery on the condition that it be a partner in the refinery at the appraised value of the field, he noted.
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