Turkey’s Hunt for Energy and Influence Sparks Global Deal Drive

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(Bloomberg) — From US natural gas to Southeast Asian oil and and uranium in Sub-Saharan Africa, Turkey is on a global hunt for energy and commodities, leveraging its growing foreign policy clout for an edge in the competition for resources.

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Ankara’s push is going full speed this year, with exploration deals signed on three continents – the latest just last week in Oman – and specialist ships secured to back them. Meanwhile, state gas company Botas is preparing for a new role as an international trader.

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The aim is to secure access to crucial commodities to power the energy-hungry $1.4 trillion economy at a time of uncertainty about supply chains. That would mimic what China has done – on a much larger scale – since the 1990s through its own state firms’ international expansion. For President Recep Tayyip Erdogan, it’s also a way to boost Turkey’s influence and build economic relationships.

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According to Ahmet Turkoglu, the head of state upstream company Turkiye Petrolleri AO, which already produces some oil in Russia, Azerbaijan and Iraq as well as within Turkey, these are must-do projects.

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“Geopolitical realities, such as security of supply and technology, are now imperatives, not options,” he said in a speech last month.

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But the idea is wildly ambitious in parts, putting civil servants in charge of the type of exploration projects normally the preserve of giant energy conglomerates or smaller specialist businesses. That means the investment and spending comes with an element of risk for public money. 

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“For a national oil company to be an frontier exploration company is a very high-risk venture with public funds,” said Valerie Marcel, executive director of New Producers for Sustainable Energy, a network of energy-producing governments. “It’s an area where there’s potential to make a lot of extra money, but also the potential to lose money.”

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Sales Pitch

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Turkey isn’t the only nation chasing commodities. Europe, for example, has unleashed a major push for liquefied natural gas as it weans itself off Russia.

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As Ankara makes its pitch to foreign governments, it points to its deepwater Black Sea gas project as proof that it can deliver complicated projects at scale. There’s its location – between Europe and Asia – and relative lack of colonial baggage compared with western counterparts.

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It’s also expanding its fleet of specialized vessels. TPAO recently bought two drillships from Norway’s Eldorado Drilling for around $245 million each.

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This year, Energy Ministry-controlled companies have signed upstream agreements with Oman, Libya, Pakistan, Azerbaijan and Hungary – all countries with which Ankara has strengthened ties in recent years.

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In mining, they’re studying gold deposits in Sudan, where Turkey has backed the government in a civil war. Officials have also said they’re discussing deals in Angola, Malaysia, Indonesia, Niger, Turkmenistan, Iraq and Bulgaria.

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The talks with Niger, one of the world’s top uranium producers, show how Turkey has taken advantage of the country’s 2023 coup and the junta’s push to squeeze out longstanding French producer Orano SA.