Iran nuke deal may fuel Turkey’s pipe dreams

Iran deal may finally enable Turkey’s hope for an Iranian contribution to the EU’s Southern Gas Corridor.

Construction equipment during the groundbreaking ceremony of TANAP [Getty]
Construction equipment at the groundbreaking ceremony of TANAP [Getty]

“If Iran gets a nuclear weapon, it will only be a matter of time before Turkey starts wanting one.” 

This axiom used to be the main lens through which both Washington and Brussels have interpreted how a nuclear Iran would impact Turkey. Ankara never formally commented on that assertion, citing the fact that it complied fully with IAEA requirements – along with a reminder that conventional military superiority offered the best long-term deterrence without the diplomatic and political headaches of possessing nuclear capabilities.

Furthermore, Ankara never balked at the Iranian nuclear programme, going through a number of policy positions: that Iran’s nuclear programme posed no threat for Turkey, then, the fact that nuclear proliferation is a regional issue that needed to be addressed at the regional level without singling out Iran, and finally, that a more constructive diplomatic approach from the West could create the conditions for Iran to scale down its nuclear programme.

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Ankara also took on a self-appointed role as a diplomatic bridge between Iran and the West, an initiative, which culminated with the May 2010 trilateral agreement – with Brazil – to outsource Iranian uranium enrichment.

Shifting policy

Turkey’s policy line towards Iran shifted with the changing sectarian dynamics emerging with the Arab Spring movements, and with Phase One of of NATO’s missile defence shield in September 2011, as a result of which, a land-based early warning radar was deployed at Kurecik Air Force base.

However, playing out behind the shadow of Iran’s nuclear programme was Turkey’s strategy of securing an eventual Iranian contribution to the European Union’s Southern Gas Corridor – first, in the form of Nabucco, and after it was discarded, the Trans-Anatolian Natural Gas Pipeline (TANAP) project.

As the Russian-Ukrainian gas dispute of 2009 accelerated Europe’s attempts towards finding alternative gas supplies, Turkey tried to rise up to the challenge by connecting Iraqi, Iranian and Azerbaijani gas fields to Europe and render itself as the energy hub of the region. Yet, there were several logistical problems.

First, even though the Iraqi Kurds’ and Turkey were geographically natural partners for gas cooperation, Kurdish fields needed more investment to yield production beyond domestic consumption – at least until 2017. Iraqi Kurds’ demand is currently estimated at 10 billion cubic metres (bcm) per year, while production is only at 4 bcm/year. Thus, connecting Kurdish natural gas to the Southern Gas Corridor didn’t seem feasible in the medium term.

The second problem was the sanctions on Iran. These restrictions prevented necessary investment into the South Pars gas field, which further prevented Iran from developing the field for domestic consumption as well as its export obligations. This further meant that Europe’s Southern Gas Corridor wouldn’t be able to benefit from the world’s second largest proven natural gas reserve holder.

Turkey may be let down by the fact that the P5+1 ended up striking a deal with Iran without Ankara's significant diplomatic involvement - which was an important self-appointed role for Turkish foreign policy circles. Yet, this doesn't mean that Turkey will not benefit from the deal.

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Azerbaijan

With both Iranian and Iraqi Kurdish options gone from short-term calculations, the Southern Gas Corridor could only mean Azerbaijan. Yet, this too was problematic for the European Union; 16 bcm natural gas supply from Shah Deniz II – 6 bcm of which would be used by Turkey, while 10 bcm to be sent to European markets under TANAP obligations – was hardly enough to render Shah Deniz field as a short-term emergency supply alternative, let alone a real strategic alternative to a dependence on Russian gas.

Even though Turkmenistan also signed an outline deal with Turkey on November 7, 2014 for the sale of its gas for delivery through TANAP, the fact that both sides didn’t disclose the terms of the agreement failed to satisfy the European Union.

In December 2014, EU Energy Commissioner Marosh Shefchovich formally asked TANAP to increase the capacity of its supply to Europe to 20 bcm, yet added that “there are technical prerequisites for power increase”. For TANAP to reach its full potential, and thus for the Southern Gas Corridor to fully serve its purpose, substantially more gas would have to be injected into the project.

Turkey may be let down by the fact that the P5+1 ended up striking a deal with Iran without Ankara’s significant diplomatic involvement – which was an important self-appointed role for Turkish foreign policy circles. Yet, this doesn’t mean that Turkey will not benefit from the deal.

The most substantial benefit indeed is the fact that connecting Iran to the Southern Gas Corridor is now a possibility – albeit a difficult one. Rovnah Abdullayev, president of Azerbaijan’s State Oil Company (SOCAR), went on the record on April 4, stating that Iran is interested in purchasing a stake in TANAP. From an energy policy point of view, this is good news for all sides concerned.

Hurdles for Iranian gas

However, there are two immediate hurdles to getting Iranian gas into TANAP. The first is the politics of the Iranian Revolutionary Guard Corps. The IRGC’s business interests spilled over into the oil and gas sectors in the last decade and they will be the first to resist exporting gas to Europe through Turkey. The IRGC seeks to protect its dominant status as the most influential business interest controlling Iran’s oil and gas resources. Opening Iran’s gas infrastructure to foreign companies means IRGC would face increased competition and would likely resist foreign business interests’ stakes in gas development, citing security and independence.

Whether Iran can get involved with TANAP without exporting IRGC’s financial interests in the meantime – or whether IRGC will accept Iran’s involvement in TANAP in a deal that doesn’t look after those interests, is a key concern. 

The IRGC will seek to use TANAP as a means to expand its own business interests into the project. Having a paramilitary elite organisation with business interests in TANAP is problematic from a financial point of view. In order to prevent foreign companies from dominating Iran’s gas market and sidelining IRGC, the organisation will rather seek to dominate TANAP and use the project to pursue its own financial interests. This will be problematic for all TANAP signatories as they will have to deal with a willing administration and an unwilling military branch with significant financial weight over Iran’s gas.

The second hurdle is whether Iranian natural gas infrastructure can be brought up to speed quickly before the EU starts seeking other energy alternatives to TANAP.

If TANAP transits inadequate amounts of gas too late and at high prices, the EU may benefit more from seeking a settlement with Russia, rather than from newly emerging alternatives. This means that Russia has more to gain from the breakdown of the newly established trust between Iran and the West – if Iranian natural gas begins flowing into European markets through TANAP, Moscow will be left with a major natural gas rival that it can’t easily sideline or contain.

Akin Unver is an assistant professor of international relations at Kadir has University, Istanbul.

The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial policy.