Author: Doğancan Çelik

Oil, a complex mixture of hydrogen, carbon, nitrogen, oxygen, and sulfur, is a valuable resource due to its combustible nature. The use of oil dates back to ancient times, with the first recorded discovery believed to have occurred around 3200 BC. Initially used for lighting, the commercial exploitation of oil began in the 19th century with the refining of kerosene by Americans. In 1859, the first commercial oil well was drilled in Pennsylvania at a depth of 69 meters, marking the beginning of the oil industry. The first oil production in Asia was carried out in Baku in 1877, cementing oil’s importance as a global resource. Focus on oil production in Turkey is increased recently. 

Oil Production in Turkey – Statistics

Turkey‘s oil production in 2020 was reported at 3.2 million tons, with a daily average production rate of 60,845 and a production-to-consumption rate of 7.1%. The country’s oil industry boasts 5,045 wells, comprising 1,984 exploration wells, 2,101 production wells, and 960 appraisal wells, with an average depth of 1,904 meters. The highest-producing well is the “Batı Raman” well in Batman province, which yields an average of 17,963 barrels of oil per day, while the lowest-producing well is the “Nusaybin” well in Mardin province, producing just 768 barrels of crude oil. Since 1945, Turkey has discovered 165 oil fields across 2,101 oil discoveries. Investment in the industry comes from 37 companies, 12 of which are foreign and 25 are domestic, with 322 licensed companies currently engaged in oil exploration.

The History of Oil in Turkey

The history of oil exploration in Turkey can be traced back to 1887 when Sadrazam Kamil Pasha was granted the petroleum concession in the vicinity of İskenderun through an Ottoman decree. In 1890, gas samples were discovered during the first drilling in İskenderun Çengen. In 1898, a well was drilled to a depth of 108 meters in Gaziköy, but no oil was found. During the same period, the Ottoman Bank and French companies discovered 82 meters of oil in Şarköy and 74 meters in Mürefte. In 1899, experts from the European Petroleum Company found oil in Hora Dere, initially extracting 2 tons, which increased to 47 tons in 1901. However, the well was eventually abandoned due to low productivity.

In 1914, the European Petroleum Company was granted permission to search for oil in Mosul. However, the onset of World War I halted their work, and instead, Standard Oil was authorized to operate in Mürefte-Hoşköy. Following the revolution of Mustafa Kemal in 1926, the Turkish Republic was established, and Petroleum Law No. 792 granted the government the right to search for and operate all petroleum and its components within the country’s borders. Turkey’s first refinery, Boğaziçi Tasfiyehanesi, was established during this time, with a daily processing capacity of 40 tons of crude oil from Romania. In 1935, Law No. 2804 created the Mineral Research and Exploration Institute (MTA), which was authorized to carry out gold and oil exploration activities. The Raman-1 well in Batman yielded oil in 1940, marking the first commercial discovery of oil in Turkey, and subsequent significant discoveries were made in the Raman-8 well.

A refinery with a daily processing capacity of 200 tons was established in Turkey in 1945. In 1954, the then-existing Petroleum Law was abolished, and the government intended to transfer the rights for oil exploration and operation to legal entities under the Mineral Research and Exploration Institute (MTA). The new Turkish Petroleum Corporation Law, also known as Law No. 6327, granted the Council of Ministers the right to establish the Turkish Petroleum Corporation, while also providing the Petroleum Department Directorate with the same authority. This legislation opened up oil exploration and operating activities to the private sector.

In 1957, Anadolu Tasfiyehane (ATAS) was formed in conjunction with Mobil, BP, California Texas, and Shell. Two years later, Istanbul Petroleum Refinery Inc. (IPRAS) was established as a joint venture between the Turkish Petroleum Corporation and California Texas. In 1973, the Petroleum Law underwent a change in its structure, adopting a more “statist” approach. Operating licenses were reduced from 40 to 20 years, and only the Turkish Petroleum Corporation was permitted to reapply for expired wells. In 1984, the Turkish Petroleum Institute was dissolved under new legislation, and all shares of the Turkish Petroleum Corporation were transferred to the Economic State Enterprise. In 1998, fuel prices were determined by the Italian market, and an automated pricing mechanism was implemented. In 2000, Law No. 4586 was introduced to regulate the legal framework for the transit passage of petroleum through pipelines in the Baku-Tbilisi-Ceyhan Crude Oil Pipeline. In 2013, the new Turkish Petroleum Law No. 6491 was put into effect. The exploration and production license periods were extended, the exploration license’s “state right” was removed, and the opportunity for swift expropriation was created.

New Oil Field: Gabar

In 2020, exploration began on Gabar Mountain situated in Şırnak province, and as a result, the first oil well was put into production in 2021. The discovered oil field contains five wells producing high-quality oil, averaging 5,000 barrels. The objective is to enhance production to 10,000 barrels and achieve a daily production of 25,000 barrels by drilling more wells. The Gabar Mountain oil reserve is estimated to be 150 million net barrels and valued at 12 billion dollars.

Conclusion

In conclusion, Turkey’s oil reserves are not as abundant as those of its neighboring countries due to the country’s geological structure. The oil wells in Turkey are much deeper than those in Iraq, Iran, and Syria, making oil exploration and extraction more challenging. This difficulty, combined with the limited size of oil fields in Turkey, has led to low oil productivity. Despite the fact that oil exploration activities have been ongoing in Turkey for more than a century, the recent discovery of the Gabar oil reserve in 2022, with an estimated worth of up to 15 billion dollars, highlights the untapped potential for oil exploration and operations in the country. Further exploration and investment in the Turkish oil industry could uncover more significant reserves and increase the country’s oil production.