Tuesday, 31 May 2011

Turkey-Iran finalise energy roadmap

Energy Minister Majid Namjoo announced on 3rd May at a joint press conference in Ankara with Turkish Energy Minister Taner Yildiz that Iran and Turkey have finalised an energy roadmap aimed at promoting investment and cooperation between the two neighbours. Namjoo stated that the agreement will have a "promising prospect" for Iran–Turkey energy transactions, boosting the two countries' electricity transmission capacity from "the current 500 MW to 1,000 MW."

According to analysts, Iran has several important reasons for seeking to increase its electricity cooperation with neighbouring countries. First, selling electricity instead of gas and crude oil will give Iran added value for its exports. Second, such exports allow Iran to maintain its energy balance as it exports gas and consumes electricity in the summer (when domestic gas demand is low), and exports electricity and consumes gas in the winter (when domestic electricity demand is low).

Lastly, by connecting its grid to neighbouring countries, Iran is making it more difficult for its energy sector to be placed under sanctions, as neighbouring countries would find it difficult to replace their reliance on Iran's electricity exports and would therefore resist or circumvent such measures by the international community.

For more news and expert analysis about Iran, please see Iran Strategic Focus.

© 2011 Menas Associates

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