Publication: Eurasia Daily Monitor Volume: 5 Issue: 114

On June 13, during a visit to Istanbul for the Third Turkish-Arab Economic Forum, Syrian Oil Minister Sufiyan al-AW announced that Syria and Turkey were preparing to create a joint oil company to conduct oil prospecting activities in Syria, Turkey and third countries. Al-AW said that the company would be a joint venture between the state-owned companies, the Turkish Petroleum Corporation (TPAO) and the Syrian Petroleum Corporation (SPC). He predicted that an initial agreement would be signed by the end of June.

Al-AW suggested that the two countries could also cooperate in other energy fields.

“In the future we could found joint nuclear power plants for electricity production,” predicted Al-AW (Reuters, June 13).

TPAO General Manager Mehmet Uysal confirmed that Turkey and Syria were planning to create a joint oil company but was more cautious about the timetable, predicting that TPAO and SPC would begin negotiations by the end of 2008. Nor did he appear as ambitious as Al-AW when it came to the company’s potential, commenting that its primary goal would be to facilitate joint investments in oil fields inside Syria (Referans, June 14).

Economic and political ties between Syria and Turkey have improved dramatically over the last decade. In fall 1998 the two countries almost went to war when Turkey threatened to invade Syria unless it expelled Abdullah Ocalan, the founder of the Kurdistan Workers Party (PKK). Following Ocalan’s expulsion, capture and subsequent imprisonment in Turkey, both countries have worked hard to improve relations. Over the past five years, Turkey and Syria have signed a string of agreements, ranging from the avoidance of double taxation to cooperation in road, land and air transportation. In January 2007 Turkey and Syria signed a free trade agreement. Bilateral trade has grown rapidly, rising from $797 million in 2006 to $1.2 billion in 2007. Damascus has also sought to counter its relative international isolation by strengthening its political ties with Ankara. Turkey is currently serving as an intermediary in indirect peace negotiations between Syria and Israel (see EDM, May 30).

Syria has long sought strategic economic cooperation with Turkey. The joint oil company was first suggested in October 2005. During a visit to Ankara, Syrian Deputy Prime Minister Abdallah al-Dardari told a correspondent from the Syrian Arab News Agency (SANA) that Turkey and Syria were studying a memorandum of understanding (MOU) which foresaw the creation of a joint venture between TPAO and SPC (SANA, October 7, 2005).

At the Third Turkish-Arab Economic Forum in Istanbul, Turkish Energy Minister Hilmi Guler spoke effusively about the potential for sharing “experience and resources” and the creation of “alternative resources” to ensure “energy independence.” Guler highlighted what he described as Turkey’s “significant potential in wind, solar and hydroelectric energy” (Referans, June 14), but he made no mention of nuclear energy. Nor did Al-AW’s suggestion that Turkey and Syria could jointly build a nuclear power plant appear in the Turkish media’s coverage of the forum.

The contract for Turkey’s first ever nuclear power plant was put out to tender in March. On June 6 the Turkish government announced that six potential bidders had purchased tender documents (see EDM, June 12). The plant is scheduled to be built in Akkuyu, near the eastern Mediterranean port of Mersin. The deadline for bids is currently September 24.

Turkey has already antagonized the United States by signing energy agreements with Iran at a time when Washington has been trying to pressure Tehran over its controversial nuclear program. In July 2007 Turkey defied the United States by signing an MOU with Iran, which foresees TPAO investing $3.5 billion, including the construction of a $2 billion pipeline to bring natural gas from Iran’s South Pars field to Turkey. In October 2007 the Turkish Energy Ministry issued a statement insisting that it would push ahead with the agreement, even if it meant risking U.S. sanctions (see EDM, October 5).

There is little doubt that Turkey is keen to strengthen its economic ties with Syria still further. One of the reasons is that the increase in cross-border trade with Syria has given a boost to the local economy in southeast Turkey, which has long been the most underdeveloped region of the country. Turkish officials are also keen on locking the two countries into a close economic relationship ahead of any possible future tension over water. Syria is heavily dependent on the Euphrates, which rises in Turkey, for its supplies of fresh water. Growing demand and a series of dry summers inside Turkey are likely to increase pressure on the Euphrates in the years ahead (see EDM, April 4).

But, at a time when it has yet to build its own first nuclear power plant, Turkey is simply not in a position to build one together with Syria. The resounding silence in Turkey in response to Al-AW’s proposal probably also reflects an awareness that it is not only the United States that would have reservations about a Syrian nuclear program. On September 6, 2007, the Turkish Foreign Ministry issued a statement harshly criticizing an Israeli air raid that destroyed a facility inside Syria which was suspected of being associated with a covert nuclear program (see EDM, September 11). Turkey is unlikely, however, to want to give the Israelis the impression that it is willing to help Syria develop a nuclear program, even if it is for ostensibly peaceful purposes. Nor is it likely to be eager to create what could, under the current circumstances, eventually become a potential target for another Israeli air raid.