COMMENT: A stable Syria could become a major energy hub

COMMENT: A stable Syria could become a major energy hub
Qatar has always wanted to build pipeline to Turkey and has enough gas single-handedly to supply Europe with gas for century. If Syria emerges from the ousting of Assad as a stable country then that pipeline dream becomes possible. / bne IntelliNews
By Ben Aris in Berlin December 12, 2024

It’s been a pipe dream for decades, but with the fall of the Assad regime a stable Syria means a pipeline connecting Qatar to Turkey is possible, which would connect the gas fields of the Middle East to Europe.

Qatar is home to a massive 25 trillion cubic metres of gas and has long wanted to build a pipeline connecting its reserves to the lucrative European market. That would transform Syria into a major energy hub. Instability in the region has bottled Qatari gas up and forced the Arab country to ship its gas around the world as more energy-intensive and less profitable LNG. Qatar has enough gas to supply Europe for a century by itself and is already a major player in  the global LNG business.

Former Syrian president Bashar al-Assad was ousted on December 7 and fled to Moscow. It remains unclear who will take over, but the victorious Hayat Tahrir al-Sham (HTS) rebels that swept through Syria in the last two weeks have established an interim government and are now in talks with the major international players and other rebel groups in an effort to effect a smooth transition of power.

Syria has been the cork that bottled up the Middle East’s access to the European markets. The Qatar-Turkey pipeline idea was reportedly rejected by Assad in 2009 and was also opposed by Russia, which at the time dominated piped supplies of gas to Europe.

Russia’s virtual monopoly on gas supplies to Europe was threatened by Qatar and the Kremlin worked hard to prevent the connecting pipelines from being built. Maintaining its influence in Syria to a gas pipeline transiting the country was one of the many reasons for Russia’s support of the Assad regime. But all the geopolitical objections to the Qatar-Turkey pipeline have fallen away. Assad is in Moscow and Russian gas supplies to Europe have been all but cut off since the destruction of the Nord Stream 1 & 2 pipelines last year. Moreover, building the Qatar-Turkey pipeline would permanently free Europe from any need to import Russian gas ever again.

The pipeline from Qatar would have to run through the Kingdom of Saudi Arabia (KSA) and Syria before reaching Turkey, which is already connected to the European gas pipeline network via the TurkStream pipeline that delivers Russian gas to the EU.

An alternative route could traverse the KSA, Jordan and Israel before reaching the Mediterranean Sea, and was also mooted as a new India-Middle East transport route connecting India to Europe at last year’s G20 summit, hosted by New Delhi. Running the pipeline via KSA, Kuwait, Iraq and Turkey has also been considered.

The original concept would cost $10bn to build a 1,500-kilometre pipeline from Qatar’s part of the vast North Dome/South Pars field in the Gulf, which it shares with Iran, to Turkey, which aspires to set up a gas hub together with North African and Central Asian producers as well as Russia. Turkish President Recep Tayyip Erdogan said earlier this year the Turkish gas hub could provide Europe with 100bn cubic metres, or two thirds of the volume of gas Russia used to provide to Europe, despite the fact that Turkey has no gas reserves of its own.

The Trans-Anatolian Natural Gas Pipeline (TANAP) connecting Azerbaijan to Turkey and Europe already exists and is currently the only competition the Qatar-Turkey pipeline would face. However, with a total capacity of only 16 bcm a year it remains small and is already fully utilised delivering 13 bcm of Azeri gas to the EU.

Azerbaijan has promised to increase its volumes to the EU to 20 bcm a year, but that is dependent on ramping up production at its giant Shah Deniz gas field and expanding the capacity of the Southern Gas Corridor (SGC) that also includes the Trans-Adriatic Pipeline (TAP).

There is also the 10 bcm Arab Gas Pipeline (AGP) that exports Egyptian gas to Syria and other countries in the region. In theory the pipeline’s flows could be reversed and extended to connect with Qatar and Turkey. The 1,200-km pipeline originates in El-Arish, Egypt, and travels through Jordan and Syria, with a spur reaching Lebanon and another spur to Israel. Previously there was a plan to connect the AGP to Turkey but that was interrupted by the outbreak of the Syrian war in 2011. If Syria emerges from the current transition of power to a new government those plans are in theory back on.

For comparison, both Nord Stream 1 & 2 pipelines had a capacity of 55 bcm each and the Yamal pipeline that runs from Russia’s Arctic gas fields to Poland has a capacity of 33 bcm. In total, Europe consumes some 400 bcm of gas per year, depending on the weather.

Political problems

Even with a stable Syria, there are still major political risks involved with all the alternative route from Qatar to Europe. Iraq has always been unstable and remains so today, especially after the US finally pulled out the last of its troops in November.

The Iraq route also runs through the region of Kurdistan in northern Iraq that is less than stable, but would also be a big problem for Turkey, which has been battling against Kurdish terrorism for years.

There problems make the Syrian route much more appealing and an easier sell to Ankara, which remains a key player in this pipeline project.

HTS must be interested in the pipeline and was indirectly backed by Turkey, so there is already a lot of common ground between Damascus and Ankara to see the pipeline built. HTS also has good relations with Qatar, which was one of the regional powers that was involved in brokering a peaceful departure of Assad in the two days before he fled the country. Russia, KSA and the UAE were also involved in these talks. All these players want to avoid a bloody civil war that would destabilise the whole region.

The knot that still needs to be unravelled is winning over KSA to the idea. KSA and Tehran re-established diplomatic relations last year after a seven-year break but the relationship remains prickly.

Relations between Riyadh and Doha are also strained. KSA, UAE, Bahrain and Egypt, severed ties with Qatar in 2017, accusing Qatar of supporting terrorism and its close relations with Iran. That led to a blockade, including the closure of borders and airspace.

But the rift was patched up in January 2021, thanks to diplomatic efforts by Kuwait and the US, culminating in the Al-'Ula Declaration that resorted full diplomatic relations between Qatar and the blockading nations, with borders and airspace reopening.

The Qatari-Saudi Coordination Council was re-established which has helped strengthen bilateral ties and put in place various agreements to enhance trade, security and cultural ties.

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