Azernews.Az

Turkey may terminate a contract to buy 6 billion cubic metres of natural gas from Russia's Gazprom unless it obtains a sufficient price reduction, Energy Minister Taner Yildiz said on Thursday, Reuters reported.

Turkey has take-or-pay contracts to buy up to 30 billion cubic metres of gas annually from Russia but has been buying less. Gazprom says it sold 18 bcm to Turkey last year.

This year, Turkish officials expect to take delivery of more than the 75 percent of the contracted amount to avoid take-or-pay penalties. One way to bring down that required amount is to cut contracts.

"There is a 6 bcm contract on the West pipeline that's about to end. We will terminate the contract if we don't see a sufficient price reduction," Yildiz said.

He said Turkey was reevaluating contracts to make savings after seeing a 39 percent increase in natural gas prices in the past 29 months.

It has pressed Russia for discounts, but the two sides failed to reach an agreement in March when the subject came up during talks in Moscow between Prime Minister Tayyip Erdogan and Russian President Dmitry Medvedev.

The export arm of Russian gas producer Gazprom said on Thursday it was in talks with Botas, Turkish pipeline operator and gas importer, on supply contracts and that the Turkish Energy Ministry was not involved in negotiations.

"Gazprom Export has not received any information from its Turkish partner, Botas, on its position over prolonging the contract," Gazprom said in emailed comments.

A number of Russia's customers have been vying for price cuts from the world's biggest oil and gas exporter. Russia's failure to come to an agreement with Ukraine over gas prices has led to fresh worries of a new gas war, similar to the kind that cut off supplies to Europe in the past.

If Botas does cancel the 6 bcm West pipeline contract, Turkish private sector firms are expected to sign deals for smaller amounts, taking the burden off the Turkish state sector.