Natural gas find:  What do we know?

Turkey’s President Erdogan announced with great fanfare a potential natural gas field of 320 billion cubic meters in Black Sea.  Technical details are emerging only slowly, with Turkey’s state owned Turkish Petroleum Corporation (TPAO) stated in a press release that “Tuna-1 well data and geophysical studies show a potential of 320 billion cubic meters of lean gas which represents the largest discovery in Black Sea. There is also an expectation of additional upside potential down at the undrilled section of the well”.  Just how much of the reserve can be developed and what is can be worth to Turkey are questions which can’t be answered at this point.


PA Turkey compiled comments from reliable media sources about the economic value of the potential gas find.


Turkey’s Energy Minister Mr Fatih Dönmez priced the discovery at $65 bn over the life time of the well, which in the absence of adjunct fields, would be extracted over 7-8 years.


TPAO Pres Statement


Tuna-1 ultra-deep water exploration well in block AR/TPO/KD/C26-C27-D26-D27,

100 percent TPAO equity, drilled with 6th generation drillship ‘’Fatih’’ which was

purchased in 2018 by TPAO. Entire block is 7000 square kilometers. The well, which

was drilled in 2115 meters of water depth reaching a final total depth of 4525

meters, encountered more than 100 meters of natural gas bearing reservoir in

Pliocene and Miocene sands.

According to detailed Tuna-1 data collection and geophysical studies, the prospect

has a potential of 11 trillion cubic feet (approximately 2 billion barrels of

recoverable oil equivalent) of gas which represents the largest discovery in Turkish

Exclusive Economic Zone and entire Black Sea. This exploration success will give a

major boost to Turkeys economic growth by supplying natural gas for decades.

Melih Han Bilgin, TPAO’s Chairman and CEO said ‘’ TPAO will immediately start

acquiring 3D seismic in the entire license and appraise the field extensively to

produce first gas by 2023. This exploration success confirms the outstanding

capabilities of TPAO and hence Turkish geoscientists and engineers in all involved

units for generating and evaluating ultra-deep water prospects, utilizing state-of-the-art technology. Indeed, there is still an expectation of additional potential at the deeper section of the well, as well as the unexplored surrounding part of the Block. Therefore, this day will mark a new beginning for TPAO and Turkey.’’

TPAO holds 100 percent of block AR/TPO/KD/C26-C27-D26-D27 interest.



Financial Times:  Important, but further study needed


“This is an estimate based on just a discovery well that will need to be confirmed by further drilling of appraisal wells,” said Ashley Sherman at Wood Mackenzie, according to Financial Times.


“But it is still likely Turkey’s largest ever discovery by some margin, and the largest ever in the Black Sea. That has potentially huge implications for Turkey’s energy supplies and the narrative around the deep-water potential of the Black Sea.”


Jonathan Lamb at Wood & Company said having production up and running within three years seemed very optimistic, with the Black Sea lacking in widely developed energy infrastructure.


“I suspect five years is the best you can hope for,” Mr Lamb said. “They may be able to attract an international oil major as they have essentially a captive market for the gas sales, but the tone around this discovery is very nationalistic so I suspect they may try to go it alone.”



Global Wonks:  Only a “possible reserve”


Global Wonks, a Washington DA based think tank  compiled views from its roster of experts. Efe E, an energy consultant writing for GlobalkWonks stated

“Economically speaking, the wellhead break-even point will be around 6-8 USD/MMBTU, similar to Romania’s Trident and Neptun fields.

Firstly, 320 bcm is the Possible Reserve, which means that the possibility of extraction is 10% according to SPE standards”.


Sergi Lanau of  IIF on twitter

Turkey says it’ll tap 320bcm of gas starting in 2023. Extracted over 10 years at a price of $2.3 / MMBtu (futures pricing now), it would improve the gas trade balance by about 0.3% of GDP. Not a game changer assuming this back of the envelope calculation is roughly ok.


Emre Akçakmak at twitter

Erdogan announces 320bn m3 natural gas discovery in Black Sea.

Turkey imports 45-50bn m3 a year & pays USD 12-13bn, making reserves worth ~USD 80bn (excluding project, transportation, extraction etc. costs).

Assuming 20 years lifetime, Turkey saves USD 4bn a year, i.e.. 0.5% of GDP.


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Published By: Atilla Yeşilada

GlobalSource Partners’ Turkey Country Analyst Atilla Yesilada is the country’s leading political analyst and commentator. He is known throughout the finance and political science world for his thorough and outspoken coverage of Turkey’s political and financial developments. In addition to his extensive writing schedule, he is often called upon to provide his political expertise on major radio and television channels. Based in Istanbul, Atilla is co-founder of the information platform Istanbul Analytics and is one of GlobalSource’s local partners in Turkey. In addition to his consulting work and speaking engagements throughout the US, Europe and the Middle East, he writes regular columns for Turkey’s leading financial websites VATAN and and has contributed to the financial daily Referans and the liberal daily Radikal.