Turkey on way to becoming a key hub for LNG supplies with new tri-party agreement

Turkey is on its way to becoming a key hub for LNG supplies with cooperation from Turkey's largest public institution in the areas of energy, trade, transportation and storage, BOTAS, along with Arkas Bunkering and Sumitomo Corporation, according to Turkey's BOTAS on Wednesday.

A confidentiality agreement signed between BOTAS, which aims to become the most environmentally-friendly public institution in Turkey, Arkas Bunkering, a subsidiary of Arkas Holding and an established maritime transportation company in Turkey, and Sumitomo Corporation, one of the largest holdings in Japan, will see the parties agree on cooperating on the use of LNG - the fuel of the future - as bunker fuel for sea-going vessels.

According to BOTAS, LNG has the potential to become the most preferred bunker fuel of the future not only because it is more eco-friendly compared to conventional marine fuels but also due to its low cost.

In a written statement, BOTAS said new regulations from the International Maritime Organization (IMO), which necessitates the reduction of emission rates of marine fuels, make the signed tri-party agreement even more crucial.

"The adoption of LNG is of great importance since it represents an almost 25% reduction in carbon dioxide, a 99% reduction in sulfur, and an 85% reduction in nitrogen oxide emissions," BOTAS said.

According to IMO estimations, carbon dioxide emissions will drop by 40% in 2030 and by 70% in 2050, while the number of LNG-powered vessels and LNG bunkering stations is expected to increase significantly.

The tri-party agreement will ensure that Turkey retains its role as one of the largest fuel supply hubs in the East Mediterranean while also promoting LNG as a bunker fuel.

BOTAS explained that the number of bunkering vessels, which are used in providing LNG bunkering services, particularly in Europe's main terminals such as Rotterdam and Barcelona, is increasing day by day.

From 2019 to 2020 the number of LNG bunkering vessels doubled to 12 and the number of vessels on order has increased to 27.

"The introduction of the first LNG Bunkering service in our country and the establishment of an 'LNG Bunkering Hub' in line with our policy that supports the use of more eco-friendly bunker fuels in seas are great new steps for BOTAS, which is a pioneer in introducing new practices, and for our country," said Burhan Ozcan, general manager of BOTAS.

Seckin Gul, general manager of Arkas Bunkering said the company is providing bunkering services with experienced staff and the brand trust of 'Arkas', a leading maritime company in Turkey with a strong vessel fleet, by following a business approach that does not compromise on quality.

"Making sustainable policies and investing in the field of energy is a very important issue for Arkas Bunkering in terms of adding value to our country and our customers. For this purpose, we have already started to make preparations for the supply of LNG as bunker fuel in Turkey. Thanks to this tri-party agreement, Turkey will become a bunkering hub for LNG supply in the Eastern Mediterranean," Gul said.

Yukio Kanazawa, vice-chairman of Sumitomo Corporation Turkey added that Sumitomo Corporation, an experienced and global trading company in Asia and North America, is committed to becoming carbon neutral by 2050.

"With our strong and experienced Turkish business partners, we would like to contribute to the reduction of greenhouse gas emissions and the creation of an LNG bunkering hub in Turkey," Kanazawa said.