The Benefits of the New Turkish Gas Pipeline into Nakhchivan
Turkey’s state-owned oil and gas pipeline operator Botaş opened a tender in early June for a new gas pipeline that would extend 50 miles from the eastern Turkish city of Iğdır to the border of Azerbaijan’s Nakhchivan Autonomous Republic. The new line would carry 17.7 billion cubic feet of natural gas without charge. Its announcement is part of an agreement made in February between Azerbaijan and Turkey to fast-track the project, which has remained on hold since its signing in 2010. Constructing the pipeline would reduce the exclave’s dependence on Iran for needed natural gas.
The Nakhchivan Autonomous Republic is completely detached from the rest of Azerbaijan by Armenia, which remains in a protracted conflict with Azerbaijan over Nagorno-Karabakh. The exclave also borders Iran as well as Turkey and Armenia. Due to its geographic location, the region relies predominantly on gas imported through Iran. A 1992 agreement between Azerbaijan and Iran to address Nakhchivan’s energy security called for Iran to construct a pipeline from the mainland of Azerbaijan to the Iranian city of Jolfa and then across the border into Nakhchivan. In 2004, amended terms led to a swap agreement in which Azerbaijan provided gas to Astara on the Azerbaijan-Iranian border in exchange for 85 percent of that gas being further transported into Nakhchivan. Azerbaijan has since sought to renegotiate this agreement with Iran.
Turkey aims to replace Iran as Nakhchivan’s main gas supplier and increase its trade volume with Azerbaijan. Turkey also looks to boost trade with Azerbaijan from $4.5 billion in 2019 to $15 billion by 2023. The pipeline is just one project of a number of initiatives to improve Nakhchivan’s connectivity and to help Turkey achieve its trade volume goal. In addition to the pipeline, Turkey’s President Recep Tayyip Erdoğan announced an agreement on the Kars-Nakhchivan railway to further connect the exclave.
The new pipeline into Nakhchivan would benefit Azerbaijan and be another step in expanding the European gas grid and energy security. The project should also appeal to U.S. policymakers seeking to reduce Iran’s energy exports and revenues.