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Besim Sisman, Turkish Petroleum President: ‘Azerbaijan is an indispensable part of our portfolio’

Turkey and Azerbaijan’s energy partnership has far-reaching importance – the two countries cooperate closely in exploration, production and transportation, helping to bring Azeri energy to lucrative new markets. Turkish Petroleum is at the heart of this, with a 19% stake in the Shah Deniz field, heavy involvement in Azeri–Chirag–Gunashli, and strategic interests in Azerbaijan’s pipeline infrastructures.

With this close relationship, it’s no surprise that Azerbaijan’s leading energy event, Caspian Oil & Gas, has strong participation from Turkish Petroleum. Ahead of his presentation to delegates as part of the Caspian Oil & Gas conference programme, we spoke to Turkish Petroleum’s President and Chairman of the Board Besim Şişman about Turkish-Azeri collaboration, the company’s interests in Azerbaijan, and the future of Turkey as a natural gas hub.
 


How important is the issue of regional collaboration and discussion in the development of the hydrocarbons industry, particularly with respect to the various initiatives taking new supplies to market? 

Cooperation between parties of hydrocarbon industry is beneficial for all parties. Currently, oil companies focus on resources with higher extraction costs. The issue also increases the risk of exploration and production processes. As a result, parties of the industry should interact to mitigate risks via implementation of new technologies and different contractual terms that allow parties to bring new supplies to market.

In gas markets, indexation, hub pricing and mixed pricing formulas together with longer credit durations are the results of interaction between different parties of the industry. In addition, new technologies allow companies to increase efficiency and optimise production costs. These are good examples of collaboration in the industry.

All these parameters can be harmonised to develop regional resources and have to be evaluated carefully to improve performance of the hydrocarbon industry in the region.  


Turkish Petroleum has significant interest in Azerbaijan, particularly in the Shah Deniz field. How do you view prospects for growth especially given the crude oil price rebound?

It is a known fact that Azerbaijan has a central position for the international projects of Turkish Petroleum. Azeri–Chirag–Gunashli and Shah Deniz are significant projects that produce most of the oil and gas of TP abroad. Furthermore, production of these two projects constitutes almost half of the hydrocarbon production of Turkish Petroleum.

Azerbaijan is an indispensable part of the portfolio of Turkish Petroleum. In 2014 Turkish Petroleum acquired a further 10 per cent in the Shah Deniz project for $1.45 billion and the acquisition enhanced the Azerbaijani position in the portfolio of our company. 

Due to the low oil prices, Turkish Petroleum currently focuses on its investment liabilities especially because of the Shah Deniz Project. When oil prices rebound, which we believe is inevitable due to tightening supply, it will also bring opportunities in oil and gas markets, and in this respect Turkish Petroleum analyses markets to figure out opportunities and threats as other companies do. 

How do you see the energy market in the region progressing, particularly after TANAP is completed?

Energy markets are in transition, non-OPEC production has become an important parameter that has to be taken into consideration while analysing oil prices and market balance. In gas markets there is an increasing volume of LNG in the coming years. 

TANAP will be one of the most significant pipelines in this region, it will enhance Turkish Azerbaijani energy ties and will be an important component of the regional energy market. 

In 2014, the Azerbaijani President invited Iraq to use TANAP to commercialise its natural gas. From our perspective TANAP will become an important component of regional energy transition and it will contribute to the creation of a regional hub in this region.

Turkish Petroleum also has several strategic interests in pipeline connections not only in the Southern Gas Corridor pipeline project but also through BTC, etc. Do you view Turkey as a natural hub and transit partner for even greater capacities of hydrocarbons in years to come?

Turkish Petroleum has significant investments in the upstream and midstream sectors. Turkish Petroleum believes that a natural gas hub will bring further prosperity and stability to its region. As a result, the company is willing to invest further for the creation of a natural gas hub within the limits of its financial capacity.

What role does events like the 24th Caspian O&G exhibition & conference play in the furthering of project and market development and how important do you view coming here to participate alongside SOCAR and others?

Just like the previous Caspian Oil and Gas Exhibition & Conferences, the 24th Caspian O&G exhibition and conference will offer business development, knowledge sharing and networking opportunities to the industry spanning a wide oil and gas spectrum. The exhibition and conference provide opportunities to national and international companies to strengthen their places in Azerbaijan and further their operations, as well as catching new chances. TP is determined to operate in many parts of Azerbaijan solo or in tandem.  The exhibition is a perfect place for promotion of Turkish Petroleum in Azerbaijan and evaluation of cooperation opportunities with other companies such as SOCAR and other international companies.

For more information on Caspian Oil & Gas, visit the website.

Related Events

Event30 May

Caspian Oil & Ga..

30-31 May, 2018
AZERBAIJAN

BAKU, AZERBAIJAN
Venue: FAIRMONT HOTEL

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