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Black Sea news roundup

A range of deals are taking place in the Black Sea oil and gas industry. From bids to drill in offshore blocks in Greece to a lifting of Iranian sanctions that could lead to increased oil and gas trade, the region is seeing many changes that could have wide-reaching effects. Here are the major stories from the region:


Greece receives three drilling bids

The Greek government has announced that it has received three bids to drill for deep-sea oil and gas in several sites belonging to the nation. Several details - including the names of the bidders - have not yet been released, but will be once the tender documents have been unsealed.

Three sites have been bid for, located to the west of Greece and the south of the island of Crete. There has been a lot of speculation surrounding Greece's economic future that suggests that developing new oil fields is one of the nation's best options for financial security, and the government has had 20 blocks available to potential bidders since 2014.

Although only three of those 20 blocks have been bid for, the government is optimistic about the future. A spokesperson from Greece's Energy Ministry said that it was "assessed as a positive step in the country's attempts to utilise its subsea wealth… taking into account difficult conditions presently prevailing in the oil and gas market".


Company selected to provide gas turbines for TANAP

The Trans-Anatolian Natural Gas Pipeline (TANAP) is set to receive gas turbines for its first phase thanks to a tender from Turkish GE Petrol&Gaz. An agreement has been signed between the company and TANAP, although it is not clear what the cost of providing the turbines will be.


Could Iran deal lead to Turkey importing more gas?

A deal regarding Iran's nuclear programme, made between Iran and six other nations on July 14th, could lead to an increase in Turkish gas imports. It is also thought to lead to more trading in oil between the two nations, thanks to sanctions on Iran being lifted, which is predicted to be beneficial to both countries.

The deal stated that trade sanctions on Iran would be lifted if Iran curbed its nuclear programme. Iran agreed, meaning Turkey will be able to trade with it without issue. Before the sanctions were originally imposed, Turkey got around half its oil from Iran. It is thought that after sanctions are lifted this will increase dramatically.

It is also likely that Turkey will be able to buy gas from Iran at a discounted price if it begins to purchase more thanks to the sanctions being lifted. Mehmet Ogutcu, president of the Bosphorus Energy Club, said: "Turkey today pays the highest gas price to Iran. Iran signaled potential gas discounts if Turkey buys more gas. It is even willing to sell its Southern Persian gas to Europe through Turkey."


Russia hints at direct gas pipeline to Greece

According to Russia's energy minister, Alexsandr Novak, Moscow is considering constructing a direct pipeline to Greece to supply the country with gas. This is at least partly due to a desire to help the nation achieve economic stability, and would see a pipeline run through Georgia and Turkey before reaching Greece.

Mr Novak said: "Russia intends to support the recovery of the Greek economy by increasing cooperation in the energy sector. Therefore, we are looking into options for facilitating direct energy supplies to Greece in the near future."


Bulgaria to transport Azeri gas?

Bulgaria's prime minister Boyko Borisov has described the nation as being 'highly interested' in using Azerbaijan's natural gas. Speaking to the Russian media on July 13th, he said it's important that Bulgaria can expand its interconnectors to transport natural gas through its territory, especially through Greece. The Greece-Bulgaria Interconnector (IGB) gas pipeline would enable Bulgaria to get its resources from Azerbaijan, connecting to the Trans-Adriatic pipeline, reports Azernews.

Azeri gas will come mostly from the second stage of development of the Shah Deniz gas and condensate field, and will provide a steady flow of natural gas from the Caspian to European markets. Mr Borisov said they have repeatedly been in talks with the Azerbaijani president Ilham Aliyev about the need to deliver Azerbaijani gas through Bulgaria. "Moreover, Bulgaria and Azerbaijan are in good, friendly relations. So, the creation of a gas hub in Bulgaria is absolutely real and possible," he added.

Azerbaijan and Bulgaria have developed friendly relations since Bulgaria recognised Azerbaijani independence in January 1992. This relationship has strengthened and it is currently estimated that trade between the two countries amounted to almost $125 million, according to the Azerbaijani State Statistics Committee.


Ukraine looking to import LNG

The current situation between Russia and Ukraine has led to the latter nation seeking alternatives to Russian gas. It is believed that the country will attempt to import liquefied natural gas (LNG) from surrounding nations via the Houston-based firm Frontera Resources Corp.

The company has already signed a memorandum of understanding with Naftogaz, Ukraine's state-run energy firm, to explore for and produce gas in Ukraine. Now, Frontera is looking to export LNG from Georgia to Ukraine. Potentially, this gas would originate from the Shah Deniz gas field in Azerbaijan, but there is also potential for LNG to be produced in Georgia itself.
Steve Nicandros, Frontera's CEO and chairman, said: "This important MOU reflects Frontera’s ongoing focus to progress its Greater Black Sea Strategy by pursuing new growth throughout a region that contains significant underdeveloped and under-explored oil and gas potential."

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