Türkiye's Domestic Energy Strategy Sees Significant Growth

Source: TPAO

Türkiye's Domestic Energy Strategy Sees Significant Growth

The country has shifted its energy policy from reliance on imports to a proactive approach focused on domestic production, exploration, and regional energy diplomacy.

Energy has always been a decisive force in both the development trajectory of nations and their position in international politics, The Caspian Post reports citing Daily Sabah.

Türkiye’s energy policy has also evolved over time, shifting from a model shaped by dependency and external supply conditions to a more proactive vision pursued today. In earlier periods, the policy was largely characterized by reliance on imports and strategies defined by supplier countries. Today, however, a new approach has emerged, one that emphasizes domestic production, national exploration activities and an active role in regional energy diplomacy. Historically, Türkiye was obliged to meet the majority of its energy demand from abroad. Russia, together with Middle Eastern and Caspian suppliers in oil, was the main actor shaping its energy security. Domestic exploration and production initiatives remained limited and Türkiye’s position in the energy market was largely that of a consumer and a transit country. Energy security was framed around long-term contracts and diversification of import sources.

This picture has undergone significant changes in recent years. The discovery of the Sakarya Gas Field marked a turning point in Türkiye’s efforts to utilize its own reserves and strengthen its energy independence. Until recently, natural gas imports were secured mainly through long-term contracts linked to two different pricing models: oil-indexed contracts such as Brent, and gas-based contracts such as Henry Hub or TTF. Prices in oil-indexed contracts followed movements in global oil markets, while those tied to European gas hubs were sensitive to LNG market dynamics and regional supply-demand balances.

In both cases, Türkiye’s ability to directly influence pricing was limited, as the country primarily functioned as a consumer rather than a producer. The integration of Sakarya Field gas into the national system has begun to alter this balance. Domestic production costs are lower than the average cost of imported gas, giving Türkiye a stronger position in contract renegotiations. In long-term agreements with Russia or in supply contracts with Azerbaijan and Iran, Türkiye can now argue that its domestic production provides an alternative and that upward price flexibility must remain limited. Domestic gas thus represents not only an additional source of supply but also a bargaining tool that exerts downward pressure on prices during negotiations.

According to data from the Energy Market Regulatory Authority, the share of domestic production rose to 1.5% in 2023 with the introduction of Black Sea gas. At first glance, this may appear modest, but the critical point regarding import contracts is that this gas can play a marginal price-setting role. In energy economics, it is often the incremental supply, rather than the total volume, that determines the price. By 2025, Türkiye is expected to reach a daily production level of 9 to 10 million cubic meters, amounting to 3.5 billion cubic meters annually, which is equivalent to the volume of a single LNG cargo. Each additional unit of production creates significant bargaining power in spot LNG purchases. In the medium term, if the target of 40 million cubic meters per day is achieved by 2028, nearly 15 billion cubic meters of domestic gas will enter the system annually.

This would correspond to almost one-third of Türkiye’s annual consumption. Such a development would reduce dependence on Brent- or TTF-indexed import contracts and provide the basis for greater price stability in the domestic market. From an energy economics perspective, this would strengthen resilience against external shocks, reduce the impact of exchange rate fluctuations on prices and provide predictability in long-term costs.

The commissioning of Türkiye’s own drilling and seismic vessels is a concrete reflection of the transition from dependency to a national exploration strategy. The fleet established in recent years has had a direct impact on the economic balance of energy markets. Consisting of six drilling ships and two seismic research vessels, this fleet not only enhances exploration and production capacity but also reshapes cost structures, ensures supply security and fosters long-term price stability.

In the past, drilling and seismic services had to be purchased from foreign companies at high costs. Today, these operations are carried out with national resources, reducing external dependence, alleviating pressure on the current account deficit, and expanding Türkiye’s financial and commercial flexibility in energy markets. Three-dimensional surveys conducted by Oruç Reis and Barbaros Hayreddin Paşa have helped determine drilling sites, reducing the risk of misallocated investments and lowering exploration costs. The Sakarya discovery itself was made possible by these seismic studies, which prevented potential financial losses of billions of dollars and directed investment resources to the most promising fields. This process has enabled a more rational allocation of resources in the national energy market.

Over the past decade, Türkiye’s energy policy has acquired a new dimension with the introduction of offshore drilling and seismic exploration. By commissioning its fleet of Fatih, Yavuz, Kanuni, and Abdülhamid Han drilling ships, together with the seismic vessels Oruç Reis and Barbaros Hayreddin Paşa, Türkiye has consolidated its independence in energy exploration. These activities have yielded tangible results in the Black Sea, while in the Mediterranean, they have garnered attention primarily for their geopolitical and diplomatic implications.

In the Eastern Mediterranean, Türkiye’s activities reflect a strategic vision that goes beyond energy exploration. Disputes over maritime jurisdiction in the region have brought Türkiye’s drilling and seismic operations to the forefront of the international agenda. In response to the unilateral parcel declarations of the Greek Cypriot administration, Türkiye has deployed its drilling vessels in areas within its continental shelf as well as in licensed zones allocated by the Turkish Republic of Northern Cyprus (TRNC). The Yavuz and Fatih vessels have conducted drilling operations to the west and south of Turkish Cyprus, while the Oruç Reis seismic vessel has operated in a wide area stretching from Antalya to the vicinity of Kastellorizo (Megisti-Meis). These steps have demonstrated Türkiye’s determination not to be excluded from the energy equation in the Eastern Mediterranean.

Türkiye’s drilling vision has also extended beyond its own maritime jurisdiction. Ankara has offered its seismic and drilling capacity to friendly and allied countries. Following the maritime delimitation agreement signed with Libya, the possibility of exploration in that region has been brought to the agenda. In addition, cooperation in hydrocarbon exploration has been established with African countries, including Somalia. This demonstrates that Türkiye’s drilling fleet functions not only as an instrument of national energy security but also as an important tool of energy diplomacy.

Energy diplomacy has undergone a profound transformation itself. Türkiye now acts not only as a consumer or a transit country but also with the strategic objective of becoming an energy trading hub. Pipelines such as TANAP, TurkStream and IGB are the clearest indicators of this vision, while the expansion of LNG trade and new international agreements have further increased Türkiye’s visibility on a global scale. Today, Türkiye is recognized not merely as an importer but as a state that develops its own reserves, manages regional flows, and advances toward becoming an active hub in global energy trade.

This transformation reflects the evolution from an older policy framework defined by dependency to a new vision based on domestic production and regional influence. Compared with the past, Türkiye has become considerably more independent, proactive and regionally influential. This change is decisive not only for ensuring energy security but also for consolidating the country’s geopolitical position. It has strengthened Türkiye’s capacity to meet its own energy needs and given it a new role in regional energy politics.

Related news

The country has shifted its energy policy from reliance on imports to a proactive approach focused on domestic production, exploration, and regional energy diplomacy.