Lira still on the downside: Erdogan celebrates historic natural gas discovery

Turkey's drilling in the Black Sea appears to be successful. President Erdogan speaks of the country's largest natural gas discoveries. Nonetheless, the lira is losing a lot of its value because investors had expected more. Even experts do not share the euphoria.

Turkey encountered natural gas deposits while searching for raw materials in the Black Sea. "Turkey made the largest natural gas discovery in its history in the Black Sea," said Turkish President Recep Tayyip Erdogan in Istanbul. The drilling ship "Fatih" discovered a deposit with 320 billion cubic meters. The goal is to supply the country with gas from the deposit in 2023, according to Erdogan. For experts, however, the findings primarily raise questions.

Turkish Lira / Euro , 12

The Turkish lira fell after the announcement. Previous profits were completely lost. The stock markets have also come under pressure. According to traders, there was dissatisfaction that double the amount of natural gas was expected. The Turkish drilling ship "Fatih" has been drilling in the so-called Tuna-1 zone in the Black Sea since July 20. In a speech on Wednesday Erdogan announced that he wanted to announce "good news" with which Turkey was entering a "new era".

Question of costs still open

With the new finds, Turkey could possibly cover part of its own needs, said Simon Schulte from the Energy Economics Institute at the University of Cologne. "First of all, however, the question is what does the development and extraction of the gas cost? Such a development in the Black Sea is difficult," said Schulte. He referred to a large Romanian find near the current location in 2012. It has not yet been fully developed.

The Turkish energy expert Necdet Pamir said it was too early to reliably indicate the size of the deposit. "That takes months of work." High expectations could end in disappointment. Given a lack of its own energy reserves, Turkey has to import a large part of the demand. It is one of the largest customers for Russian natural gas. Turkey is also looking for natural gas deposits in the eastern Mediterranean, but crosses it with neighboring countries such as Cyprus and Greece.

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