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. Last Updated: 07/27/2016

Putin Backs Turkey as Energy Hub

Itar-TassPutin, left, inspecting the Turkish-Russian gas pipeline with Erdogan and Berlusconi in Samsun, Turkey, on Thursday.
SAMSUN, Turkey -- The leaders of Russia, Turkey and Italy pledged on Thursday to boost oil and gas cooperation and bring Europe greater energy security after inaugurating a natural gas pipeline under the Black Sea.

The inauguration of the Blue Stream line also capped a big improvement in economic ties between Russia and NATO member Turkey as they set aside historic rivalries in favor of trade.

President Vladimir Putin raised the possibility of a second pipeline carrying Russian natural gas and oil to Turkey, while Turkish Prime Minister Tayyip Erdogan said his country aimed to become a key energy hub for Europe and the Middle East.

"The launch of the Blue Stream pipeline [linking Russia and Turkey] is ... a step toward strengthening our continent's energy security and diversifying energy supplies to consumers," Putin said at the ceremony in Turkey's Black Sea port of Samsun.

Italy's Eni and Russia's Gazprom built the pipeline.

"There is an opportunity to build another oil or gas pipeline under the Black Sea," Putin said.

Elucidating Putin's remarks, a senior Turkish energy official said Russia planned to build an oil pipeline along the route of Blue Stream.

The official, speaking on condition of anonymity, said Russia also hoped to increase the capacity of Blue Stream itself, including, if necessary, a second gas pipeline.

Putin said Russian companies were ready for further cooperation in the Turkish oil and gas market, not only increasing exports but also taking part in building infrastructure and exploration and extraction of oil including taking equity.

"Blue Stream gives us an opportunity for shipping gas to other third countries ... There is the opportunity for building new oil and gas transport systems delivering to southern Italy, to the south of Europe as a whole and to Israel," Putin said.

"This year Blue Stream will transport 3.7 billion cubic metres of gas. If Blue Stream reaches its planned capacity, then overall Russian gas exports to Turkey will be 30 billion cubic meters a year," he said.

Gazprom chairman Alexei Miller told reporters his company was thinking of building a liquefied natural gas plant in Turkey with an annual capacity of 5 million tons, either in Izmir on the Aegean Sea or in Ceyhan.

"It is possible to increase the Russian gas going to Israel and to deliver Russian gas to be turned into LNG in Turkey and then to export that LNG to third countries," he said.

Erdogan tried to convince Putin and Italy's Prime Minister Silvio Berlusconi of the value of a pipeline carrying Russian crude from Samsun to Turkey's Mediterranean port of Ceyhan. This would help relieve congestion in Turkey's Bosporus.

"The line will provide safe transportation of oil to the Mediterranean and will increase security in [the Bosphorus] by reducing tanker traffic," Erdogan said.

A Turkish official said the Russians seemed favorable to the pipeline, despite earlier fears they were hostile. Eni chief executive Paolo Scaroni also expressed interest.

For Russia and other Black Sea states, the Bosporus provides the only outlet to world markets for oil and products exports.