Turkey Eyes LNG Leadership With Landmark Mercuria Pact

Türkiye’s state gas company BOTAŞ has sealed a 20-year liquefied natural gas supply deal with Swiss trading house Mercuria, underpinning Ankara’s ambition to deepen its role in global energy markets. The agreement guarantees deliveries of roughly 4 billion cubic metres annually, amounting to about 70 billion over the contract’s lifetime, beginning in 2026.

The signing, held during President Erdoğan’s presence in New York for the UN General Assembly, coincides with a preliminary heads-of-agreement between BOTAŞ and Australia’s Woodside Energy. That deal, effective from 2030, commits to supplying some 5.8 billion cubic metres over a nine-year span.

Energy Minister Alparslan Bayraktar framed the Mercuria contract as central to both diversifying Türkiye’s gas portfolio and bolstering supply security. He also linked it to Ankara’s broader goal of fostering a $100 billion trade corridor with the United States, saying the pact would help realise that ambition.

Turkey has long depended on a mix of pipeline imports from Russia, Azerbaijan and Iran, alongside spot LNG purchases. But with several existing pipeline contracts set to expire by 2026 and 2027, the Mercuria and Woodside agreements mark a pivot to long-term, globally sourced LNG, reducing exposure to geopolitical risk.

These deals complement a growing handful of supply contracts inked by BOTAŞ this year, including a 1.2 billion cubic metre purchase agreement with Cheniere and a two-year 600 million cubic metre deal with Hartree. Those shorter-term partnerships have offered flexibility during the transition.

Türkiye is also expanding its LNG infrastructure to absorb increased volumes. The Dörtyol Floating Storage Regasification Unit is already operational under the name Ertuğrul Gazi, named after the father of the Ottoman Empire’s founder. Meanwhile, the Saros FSRU Terminal is under construction to enhance regasification capacity.

Market watchers see Türkiye’s geographic location—bridging energy flows between Europe, the Middle East and North Africa—as a natural advantage if it can scale its trade operations. The flexibility embedded in the Mercuria pact, which permits delivery destinations across Türkiye, Europe and North Africa, supports that hub ambition.

Critics warn that infrastructure challenges and regulatory bottlenecks could limit Türkiye’s ability to re-export gas. Storage capacity remains modest relative to peak European demand, and pipeline constraints limit throughput bandwidth into western markets. Unbundling the state’s gas infrastructure and offering greater regulatory transparency will be crucial if private players are to engage meaningfully in onward trade.