April 27 (Bloomberg) -- Prime Minister Recep Tayyip Erdogan said Turkey will build a canal from the Black Sea to the Marmara Sea, turning the city of Istanbul into “two peninsulas and an island” and diverting shipping traffic from the Bosporus.
The “Istanbul Canal,” which will be up to 50 kilometers (30 miles) long, 150 meters wide and 25 meters deep, will carry as many as 160 ships per day including the largest oil tankers, Erdogan said in a speech in Istanbul today. Planning will take two years, he said.
Erdogan declined to give a cost estimate or exact location for the canal, saying they would be kept secret to “avoid any kind of negativity or injustice” before the project begins. In response to a reporter’s question, Istanbul Mayor Kadir Topbas said the project would cost more than $10 billion and take eight years to build.
Turkey is seeking to keep shipping away from the Bosporus, a winding waterway that runs through the middle of the city of 12 million people. The U.S. Energy Information Administration calls the strait “one of the world’s busiest chokepoints” and “most difficult waterways to navigate.”
Around 2.9 million barrels of oil a day were transported through the Bosporus in 2009, down from 3.4 million in 2004, according to the U.S. agency’s list of world oil transit chokepoints. The decrease came as Russia shifted crude oil exports from the Black Sea toward Baltic ports, it said.
The biggest ships to navigate the Bosporus strait today are known as suezmaxes, so called because they are also the largest to transit Egypt’s Suez Canal fully loaded. They can haul 1 million barrels of oil.
The Istanbul bypass would allow very large crude carriers, or VLCCs, which can transport twice as much, to enter the Black Sea, potentially curbing demand for the smaller vessels seeking consignments of Russian oil.
“If this canal is built and if the infrastructure in the Black Sea follows in terms of port expansion, bigger vessels could absorb the volumes of smaller ships,” Luis Mateus, an analyst at Riverlake Shipping SA in Geneva, said by e-mail today. “The canal would also alleviate the congestion and have faster transit times, but the industry needs to follow and adapt itself to a change in transport dynamics.”
New bridges and highways will be built over the planned Istanbul Canal, which will be flanked by hotels and new apartment buildings, Erdogan said.
Erdogan said there would be no trouble funding the canal.
“Turkey deserves a crazy, magnificent project like this by 2023,” Erdogan said, referring to the 100th anniversary of the declaration of the Turkish Republic.
A former mayor of Istanbul, Erdogan is seeking re-election for a third term on June 12.
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