Main opposition leader says South Stream a bad deal for Turkey

Main opposition leader says South Stream a bad deal for Turkey

CHP leader Kemal Kılıçdaroğlu (Photo: AA)

December 30, 2011, Friday/ 15:11:00

Main opposition Republican People's Party (CHP) leader Kemal Kılıçdaroğlu has said the government acted against Turkey's interests when it approved the construction of a key natural gas pipeline that will carry Russian gas to European markets via Turkey's territorial waters in the Black Sea.

Speaking at a meeting organized by the Economic Journalists Association (EGD) in İstanbul on Thursday, Kılıçdaroğlu said the South Stream project deal the government signed a day earlier in Moscow needs further investigation. “Please take a close look at this agreement. Turkey is losing a lot here,” he told the audience at the event.

In return for Turkey's giving of the green light to the key project that will bypass the Ukraine, which lies to the north, in a transit route bringing Russian natural gas to energy-thirsty Europe, Russia agreed to lower the price of the gas it sells to Turkey via the Western Pipeline. Energy and Natural Resources Minister Taner Yıldız, who travelled to the Russian capital to hand in Turkey's official approval letter to Prime Minister Vladimir Putin on Wednesday, declined to announce the size of that price cut nor clarified if it will be reflected on people's utility bills as a discount. The deal came only a week after Ukrainian President Viktor Yanukovych visited Ankara and met his Turkish counterpart Abdullah Gül and Prime Minister Recep Tayyip Erdoğan.

The South Stream pipeline project was initiated by Russian company Gazprom and Italian company Eni in 2007; the two giants established a joint company for the project in 2008. Germany's Wintershall AG and France's Électricité de France SA (EdF) also hold minority stakes in South Stream. Bulgaria, Serbia, Hungary and Greece also signed on to participate in the project.

Russia was expecting Turkey to give its approval for the construction of the pipeline by the end of October 2010, but demands from Turkey for seismic reports on the pipeline route that would pass through Turkey's Exclusive Economic Zone in the Black Sea have delayed the project. Gazprom completed the technical and ecological surveys of the South Stream route and submitted their reports to the governments of Russia, Turkey and Bulgaria in April.

Yıldız, who is also co-chairman of the Turkey-Russia Joint Economic Commission, emphasized on Wednesday that relations with Russia have never been as friendly and constructive as they are today. “We are working very closely with our Russian partners in developing joint economic interests,” he said, dismissing claims of a rift over competing pipeline projects.

South Stream will transport up to 63 billion cubic meters of gas when it opens in 2015.

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