Turkey Reportedly Turns East For Gas, Reportedly Eyes Exxon Deal To Ditch Russia

Author: Lekha Gupta | April 29, 2024 07:27am

Exxon Mobil Corporation (NYSE:XOM) is reportedly in talks with Turkey for a multibillion-dollar deal for liquefied natural gas (LNG) as Ankara seeks to curb its dependence on Russia for energy needs.

Turkish energy minister Alparslan Bayraktar said in an interview, “The country, which imports nearly all of its natural gas, is seeking to build a “new supply portfolio” that will make it less reliant on any single partner,” reported Financial Times.

Notably, as per the report, Russia is Turkey’s biggest natural gas supplier, accounting for over 40% of its consumption last year.

Bayraktar stated that Turkey plans to secure up to 2.5 million tonnes of LNG annually through this deal, which could last a decade. 

He further added that while the commercial terms of the Exxon deal were still under discussion, the 2.5 million tonnes of LNG shipped to Turkey could currently cost about $1.1 billion.

As for the report, the 2.5 million tonnes of LNG would be enough to cover roughly 7% of Turkey’s natural gas consumption last year.

Exxon stated that it had initial discussions with the Turkish government regarding potential LNG opportunities but did not comment on the details of its commercial strategy, as per the report.

Last month, Exxon Mobil reportedly said it is ahead of schedule with its plan to double the size of its LNG portfolio to 40 million tons per annum by 2030.

Last week, Exxon reported first-quarter results, with revenue of $83.083 billion, exceeding consensus by nearly $5 billion.

Investors can gain exposure to the XOM stock via Energy Select Sector SPDR Fund (NYSE:XLE) and IShares U.S. Energy ETF (NYSE:IYE).

Price Action: XOM shares are down 0.10% at $117.84 premarket at the last check Monday.

Photo: Del Henderson Jr. via Shutterstock

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