AKARYAKIT PİYASASINDA BİODİZEL İLE İLGİLİ YASADIŞI

OIL & ENERGY INDUSTRY
IN TURKEY
November 2010
Members
Altınbaş Petrol ve Ticaret
A.Ş.
Belgin Madeni Yağlar
BP Petrolleri A.Ş.
BP Gaz A.Ş.
DELTA Akaryakıt
Tic. A.Ş.
ERK Petrol Yatırımları
A.Ş.
PETROL OFİSİ A.Ş.
Shell & Turcas Petrol A.Ş.
• FUELS
(Black and white products)
The SHELL Company
of TURKEY Ltd.
Shell Gaz Ticaret ve
Sanayi A.Ş.
• LPG,
(Bulk, bottled and auto gas)
• LUBES
TOTAL Oil Türkiye A.Ş.
TURCAS Petrol A.Ş.
MOBIL Oil Türk A.Ş.
Petline Petrol Ürünleri
A.Ş.
FIELD OF ACTIVITIES
Turkuaz Petrol
Ürünleri A.Ş.
• AVIATION FUELS
• MARINE FUELS
Outline
 GENERAL OVERVIEW OF ENERGY SECTOR IN TURKEY
 Legislative structure
 Market Review
 TURKISH OIL INDUSTRY
 Demand & Supply
 Refining, Logistics &Marketing
 EU ALIGNMENT PROCESS AND ENVIRONMENTAL REGULATIONS
 EXPECTATIONS and EXPANSION OPPORTUNITIES
TURKEY – Energy Market Legislation
 Turkey has incorporated numerous Laws and Regulations in line with EU accession
programme.
Electricity and Natural Gas Market Laws (2001)
Petroleum Market Law (December 2003)
LPG Market Law (April 2004)
Petroleum Law ( in the parliament).
These laws essentially drive the energy sector towards a fully liberalized market
structure
 Energy Market Regulatory Authority (EMRA) has been established at the end of
2001 to regulate all activities in the Gas, Power and Oil Products Markets.
Primary Energy Consumption Of Turkey
(Million Tons of Oil Equivalent)
Turkey’s Primary Energy Mix
Hydro
7%
120
Coal
30%
Primary Energy Consumption Of Turkey
(MTOE)
100
8,0
7,5
7,5
Natural Gas
32%
9,9
9
80
10,4
60
9,2
8,8
9,6
5,4
7,8
25,5
20,7
22,3
24
22,6
40
7,1
8,7
9,2
11,1
20
29,8
30
29,6
29,5
13,1
31,1
31,0
8
7
21,8
14,4
29,9
7,6
21,2
15,6
30,6
21,8
18,8
31,2
23
19,9
32
26,1
24,2
30
30,4
30,0
28,8
27,4
28,5
31,6
30,5
32,4
32,3
32,5
Natural gas is the fastest growing
fuel in Turkey’s energy product
since 2008
2009 Crude Supply
(Million Tons, %)
32,0
Domestic;
2.237.221;
14%
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Oil
Source: BP Statistical Review
Natural Gas
Coal
Hydro
Oil
31%
İmport;
14.192.000
; 86%
Source: EMRA 2009 Report
5
TURKEY – Energy in brief
 Turkey is aiming to reduce its high dependency on energy imports through
diversification and by increasing utilization of domestic resources. Exploration
efforts in the Black Sea have increased; hydro and coal consumption is further
encouraged.
New Petroleum Law to encourage new exploration incentives
 Turkey’s aspiration is to become an energy bridge between major oil and gas
producing countries of the Middle East and Caspian, and the consumer markets in
Europe.
Turkey's port of Ceyhan is an important outlet for current Iraqi oil exports.
Azeri oil through Baku-Tbilisi-Ceyhan (BTC) has been active in operation
since late 2006.
Samsun – Ceyhan pipeline project aims to connect oil sources in Black Sea
to Ceyhan area.
Nabucco pipe line project aims to deliver Caspian natural gas to Europe
through Turkey..
Oil Demand & Trends
Total size of oil industry in Turkey is 60 Billion $
Source : Tüpraş
Trends In Fuels
Milyon Ton
In 2009 total fuels consumption decreased by 7,4% to 17,7 million tons. In 2010 January
October period the decrease goes on with 5,9 %
% 0,1
20,0
% - 1,8
18,0
16,0
14,0
1,0
1,3
1,4
3,8
3,9
1,0
3,8
10,0
4,0
3,7
8,0
0,0
0,0
3,6
2,9
0,0
0,0
9,5
9,7
6,0
8,2
0,6
3,7
3,4
2,9
2,7
0,2
0,7
2,7
12,0
4,0
0,7
8,4
10,5
10,4
% 8,4
0,5
2,4
2,6
0,4
2,1
2,3
2,6
2,3
2,3
2,9
% -7,4
10,6
0,0
Off Road Diesel
Diesel (10 ppm)
Total Gasoline Types
Fuel Oil N: 6
11,4
0,3
1,6
1,3
2,0
Heating Oil
0,5
11,1
- 5,9 %
2,3
0,2
3,4
1,4
1,7
0,2
0,6
1,6
2,5
3,0
7,6
7,1
10,1
Trends In Automotive Fuels
Million Ton
In 2009 total automotive fuels consumption decreased by 2,3% to 18 million tons.
20,0
% 14,0
18,0
% 3,5
16,0
14,0
12,0
1,3
1,1
1,2
10,0
4,0
3,7
8,0
0,0
0,0
2,9
0,0
0,0
6,0
4,0
8,2
8,4
1,8
2,9
2,7
0,2
0,7
1,1
3,6
9,5
1,6
9,7
10,5
10,4
1,6
2,6
% 0,1
% -2,3
2,0
2,1
2,6
2,3
2,3
2,9
1,3
2,3
2,3
3,4
0,1%
10,6
11,4
11,1
10,1
2,0
0,0
Gasoil
Low Sulphur Gasoil
Total Gasolines
LPG Autogas
1,1
1,1
1,5
1,1
1,0
4,8
4,5
1,9
• Diesel consumption has seen a fall in
2009 only.
• Gasoline consumption is decreasing
•Auto LPG is a strong substitutee
for gasoline.
Milyon M3
Trends In Automotive Fuels
18,0
16,0
2,7
3,4
14,0
4,0
12,0
0,0
10,0
8,0
0,0
0,0
9,7
10,0
11,2
0,2
0,8
12,4
12,3
1,6
1,4 %
0,0
11,5
12,5
13,5
13,2
2,9
3,6
9,0
8,4
11,9
6,0
GASOLINE
& Auto LPG CONSUMPTION
6,0
Milyon Ton
DIESEL CONSUMPTION
Off Road Diesel
Diesel (10 ppm)
100%
5,0
90%
80%
4,0
70%
60%
3,0
50%
40%
2,0
30%
20%
1,0
10%
0,0
0%
Total Gasoline Types
Total Gasoline Types
LPG Otogaz
LPG Otogaz
Source: GDPA & PETDER
Milyon Ton
Trends In Black Products & Lubes
BLACK PRODUCTS
6,0
5,0
Heating Oil
22%
4,0
% - 11 % 5
3,0
2,0
% - 30
51,1%
Fuel Oil N: 6
78%
1,0
0,0
Thousands
Fuel Oil N: 6
Source: GDPA & PETDER
Heating Oil
2010 Jan - August
400
350
300
30
35
250
200
23
83
32
30
27
38
39
39
21
23
25
LUBRICANTS
32
Chemicals
43
23
28
101
104
108
110
26
77
150
Marine Lubricants + Grease
Industrial Lubricants
150
147
149
151
133
115
0
2004
2005
2006
2007
2008
2009
Engine Lubs
44%
Gear Lubricants and
Transmission Fluids
100
50
Chemicals
8%
Marine
Lubes +
Gress
10%
Engine Lubricants
Endüstriyel
Yağlar
30%
Gear &
Transmission
Fluids
8%
Turkish Fuel Industry In Numbers
Fuels Market Players
• 4 Refineries
• 51 Distributors
• 102 Storage Facilities
• 12.847 Fuel Stations
•Total Employment
• Total Yearly Revenues
• Yearly Total Taxes/Duties Colected
> 250.000
≈ 75 Billion TL
> 35 Billion TL
LPG Market Players
• 64 Distributor
• 83 Storage Facilities
• 8.600 Autogas Stations
•20.000 Cylinder Retailers
Turkish Fuel Industry In Numbers
Yearly Consumption (Million Tons)*
2007
2008
2009
White Products (Gasolines, gasoils,
16,3
15,3
15,7
Black Products (Fuel Oils)
2,6
2,7
1,9
LPG
3,5
3,4
3,6
kerosene,...,etc.)
* Tax free and transit sales excluded.
Distributors Storage
Storage Capacity
Bounded warehouse storage (Tax free)
3.827.000 m3
Domestic terminals & depots
379.000 m3
LPG Storage Capacity (m3) (Refineries excluded)
550.000
Turkey- Natural Gas Pipelines
Russia WCBS 1&2
Azeri Gas (Shah Deniz)
Russia - Blue Stream
Turkmeni
Gas
* No field
development yet for
Turkmeni gas
Algeria LNG +
Nigeria LNG
Iran
Natural Gas Supply- Operational
Natural Gas Supply- Contracted
Natural Gas Supply- Under Discussion
Source: BOTAS
OUTCOMES OF LIBERILASATION PROCESS OIL
INDUSTRY
 OIL INDUSTRY IN TURKEY HAS SUCCESFULLY ADAPTED LIBERALISATION
 In January 1st 2005 oil products / LPG distribution companies assign “ceiling” or
“suggested” prices
• Pump prices are published at EMRA web sites
 RESTRICTIONS ON OIL IMPORTS HAVE BEEN REMOVED.
 LICENSING PERIOD HAS BEEN SUCCESSFULLY COMPLETED.
√ 4 Refineries, 51 distributors, 12847 dealers, 241 lube oil licenses
√ All non-licensed players have been pushed out of market
 IMPORTANT STEPS TOWARDS ALIGNMENT WITH EU REGULATIONS
√ Market liberalization (free movement of goods)
√ Fuels specifications adopted
√ Compulsory Oil Stocks (90 Days)
OUTCOMES / RESULTS OF NEW LEGISLATIVE
PROGRESS

SUCCESSFULL PRIVATISATION AND INCREASING FOREIGN INVESTMENTS

Successful privatization of refineries, price for 51% ownership doubled in two years

Increasing foreign investment/interest in Turkish oil market
• Shell – Turcas JV
• OMV bought Petrol Ofisi
• LUKOIL bought all shares of AKPET company,


Interest in new large scale projects (Plans for a new refinery , new pipeline)
IMPROVED COMPETETIVENESS & TRANSPARENCY
• 51 Distribution companies
• Higher quality of service at the pump stations
• New products in market (98 octane, low sulfur diesel, fully unleaded gasoline, Biofuels)
• Highly competitive industry (campaigns, promotions etc)

IMPROVED OPERATIONAL SAFETY, IMPROVED TECHNICAL STANDARDS AT STATIONS AND
TERMINALS
• GSM (Regulation for operational health & safety)

HIGHER LEVEL PARTICIPATION OF INDUSTRY ORGANISATIONS IN LEGISLATIVE PROCESS
EU LEGISLATIONS STILL TO BE ADAPTED (1)
 COMPULSORY STOCKS DIRECTIVE (COUNCIL DIRECTIVE 2009/119/EC )
 Convergence between the Community and the IEA system.
• Net imports instead of inland consumption; possible derogation for indigenous
production
 Security of supply and tradebility – Central Stockholding Agencies
• Total oil stocks maintained should be at least 90 days of average daily net
imports or 61 days of average daily inland consumption by 31 December 2012
 FUEL QUALITY DIRECTIVE (COUNCIL DIRECTIVE 2009/30/EC )
 Sulfur Content of Diesel Fuels from january1, 2011 should be 10 ppm
 Greenhouse Gas Emissions Reductions
• Greenhouse gas emissions per unit of energy from fuel and energy supplied to
be reduced by 10%, by December 2020. Reporting starts from January 1st, 2011
• 30 % reduction in greenhouse gas emissions in the context of a global agreement
and a 20 % reduction unilaterally., by 2020.
 Biofuels: Sustainability Criteria
EU LEGISLATIONS STILL TO BE ADAPTED (2):
 RENEWABLES DIRECTIVE (Directive 2009/28/EC on the promotion of
energy from renewables)
 The share of energy from renewable sources to increase 20% by 2020
• Current EU average 8,5%; Turkey 5%
 10% share of green fuels in transport .
 National Action Plans must (have) be(en) presented by June 2010.
 AIR QUALITY DIRECTIVE (2008/50/EC)
 Merges four directives related with air quality
 to reduce exposure to fine particles PM2.5 in urban areas by an average of
20% by 2020
 STAGE II Vapour Recovery (2009/126/EC)
 Petrol stations (new >500m3; existing >3000 m3) to employ stage II Vapor
recovery systems
ADAPTED EU LEGISLATION;
OUTCOMES / RESULTS YET TO BE SEEN :
 Environmental Act (2678)
 Imdemnification Of Damages at Coasts From Petroleum and Other Harmful
Substances Act (5312)
 ADR - Carriage Of Dangerous Goods On Roads, Railroads, Inland Waters
 Directive For The Fire Protection Of The Buildings,
 SEVESO Directive - (Industrial Plants to be Ready For Big Accidents/Disasters)
 Environmental Impact Analysis Directive
 Waste Management Directives
 Management of Chemicals Directives
 Management of Sea and Coast Directives
 Water Quality Directives,
 Land Quality Directives,
SUMMARY – GENERAL FUTURE TRENDS IN OIL
INDUSTRY (1)
 DIESEL FUEL AND LUBES ARE THE GROWING SEGMENTS
 LPG HAS SUSTAINED MARKET SHARE DUE TO AUTOGAS
 AUTOMOTIVE FUELS SUSTAINED GROWTH DURING ECONOMIC CRISES
 DOWNSTREAM MARKET STILL DRIVES ATTRACTION
 REFINERY INVESTMENT INITIATIVES
 LOGISTICS TO BECOME CRITICAL ITEM IN THE DOWNSTREAM
BUSINESSES FOR YEARS TO COME
 TAXATION IS A MAJOR ISSUE DRIVING FUTURE GROWTH
 EU MEMBERSHIP PROCESS AND FULL COMPLIENCE WOULD HAVE
SIGNIFICANT EFFECT IN THE INDUSTRY,MOSTLY IN THE REFINING
BUSINESS
20
Thank you…