Turkey: The Turkish Petroleum Law

Turkish Petroleum Law No. 6491 ("Turkish Petroleum Law" or "the Law") entered into force through publication in the Official Gazette dated 11 June 2013 and numbered 28674. Prior to the Law, Petroleum Law No. 6326 was in force for 59 years.

In this article, the important modifications enacted by the Turkish Petroleum Law shall be analyzed.

Purpose and Scope

The purpose and scope of the Turkish Petroleum Law is set forth under Article 1. Pursuant to said article, the purpose of the Law is to enable expedient, continuous and effective exploration, development and production of petroleum resources of the Republic of Turkey in accordance with the national interests. With this provision, the term "in accordance with the national interests", which was subject to veto and criticism previously, has been maintained. Another issue subject to criticism is that this notion is not limited to the purpose and scope provision, but can be found in the relevant law in its entirety.

Exploration License, Application and Licensing

Articles 6-8 of the Law set forth provisions related to the exploration license, application and licensing procedure and operating license. Under Article 6 of the Petroleum Law No. 6326, it was set forth that the right to obtain a permit, exploration and operating license shall be exercised by Türkiye Petrolleri Anonim OrtaklıÄxı ("TPAO") on behalf of the state. On the other hand, the Turkish Petroleum Law does not contain such provision and abrogates TPAO's right arising from the Law. In this way, private companies will be able to file a license application under the same conditions with TPAO concerning any field.

The Petroleum Law No. 6326, under Article 6, regulated that a permit, exploration and operating license could be granted in favor of stock corporations, including publicly traded companies, and to private law legal entities having the quality of a stock corporation in accordance with foreign legislation. Said legal entities could be granted a license by the Council of Ministers where it was deemed to be in accordance with the national interests. In other words, private companies were able to obtain a license with a decision of the Council of Ministers, differently from TPAO. On the other hand, the Turkish Petroleum Law does not contain such a provision related to the approval of the Council of Ministers.

Pursuant to Article 18 of the Turkish Petroleum Law, individuals who claim rights as per the relevant law are under obligation to provide an address in Turkey. An investigation permit, exploration license or operating license shall not be granted to those who do not provide an address.

Pursuant to Article 19 of the Turkish Petroleum Law, the petroleum right holder is obligated to provide, to the General Directorate of Petroleum Affairs, all records, accounts, information, documents and samples related to the petroleum transaction.

Exploration License

Pursuant to Article 6/5 of the Turkish Petroleum Law, the term of the exploration license is five years on land and eight years in seas. The license period may be extended for two years and for up to three years in seas, with the condition that the license holder submit the work and investment program which includes at least the performance of one drilling, as well as providing the corresponding two percent collateral. Additionally, the term of the exploration license of a petroleum right holder who has fulfilled their drilling program within the first extension period may be extended for up to two years on land and for up to three years in seas with the condition that they submit a new drilling and investment program, and provide the corresponding two percent collateral.

The period of the exploration license may not be more than nine years in onshore regions and fourteen years in intra-territorial waters, including the extensions made after the first effective date. However, an additional period of up to two years can be granted so that commercial evaluations can be made regarding a petroleum discovery made in the explored areas upon the expiry of the term of the exploration license.

Under the Petroleum Law No. 6326, the term of the exploration license was four years. In the event the exploration activities were continued in accordance with the relevant law and in good faith, the exploration licenses in the region could be extended up to two years. In the event that the activities of the explorer gave rise to the discovery of petroleum, and under the condition that an extension request has been made with an appropriate program, the Council of Ministers could extend the period for up to two years in exchange of a collateral. In any case, the exploration license period could not be more than eight years from the first date of entry into force. These periods could have been extended by fifty percent for sea explorations. With the Turkish Petroleum Law, the periods have been extended concerning both the first exploration license period and the total periods.

Another issue worth noticing is that no requirement of investment was sought for the extension of the period of license within Petroleum Law No. 6326. This meant that a license could be used for eight years without making any investment. However, the Turkish Petroleum Law prevents this inconvenience requiring the submission of an investment program.

Operating License

Pursuant to Article 8 of the Turkish Petroleum Law, where a discovery is made within the scope of an exploration activity, an operating license will be issued so that exploration and production are carried out, and the petroleum produced is sold during the license period. An operating license shall be issued for a period of twenty years as of the date of effect of the work and financial investment program that will be received pursuant to the regulation, depending on the request of the applicant.

The fields whose operating rights have expired can be put on auction upon the approval of the Energy and Natural Resources Minister, for the purpose of obtaining an operating license. However, before putting the same on auction, the Energy and Natural Resources Ministry will ask the TPAO whether it wishes this field to be subject to an operating license. Upon request of the TPAO, the field shall not be put on auction. Such a regulation suggests that the privilege of the TPAO has been maintained.

Surface and Water Rights

Pursuant to Article 10/1 of the Turkish Petroleum Law, the petroleum right holder shall be able to obtain the utilization right to the field required for petroleum transactions, in or in the vicinity of its exploration and operation license, by agreement if the land is privately owned or by expropriation if there is a dispute. Additionally, if the land is owned by the Treasury, the relevant land may be obtained by leasing it for the relevant sum, establishing an easement right or by obtaining a utilization right and having the same registered in its license. If the utilization right based on an agreement lasts for a period of more than three years, the land-owner or petroleum right holder may request that the field under private ownership be expropriated. The expropriation shall be made in accordance with the Expropriation Law No. 2942. Urgent appropriation may also be made in accordance with Article 27 of the Expropriation Law. The ownership right of the expropriated land shall belong to the Treasury and the utilization right shall belong to the petroleum right holder who paid the expropriation fee. In this case, the Ministry of Finance shall grant an easement right to the petroleum right holder free of charge for the duration of the license period.

Pursuant to Article 10/5 of the Turkish Petroleum Law, it is possible to conduct petroleum exploration and operation activities in license and permit areas that are located in places that are deemed as forests as per the Forest Law No. 6831; the conditions are that one must obtain permission and pay the relevant fees pursuant to the relevant legislation. During the preparatory period of the Turkish Petroleum Law, it was regulated that national parks may be open to petroleum exploration activities; however, this provision has been excluded from the Law.


Pursuant to Article 12 of the Turkish Petroleum Law, the taxes that petroleum right holders are liable to pay on their net profits and the income tax, which they are liable to withhold on behalf of their shareholders, shall not exceed fifty-five percent. This percentage was set forth as forty percent during the preparatory period of the law and was subject to criticism since it would cause tax loss. As a result of this criticism, the former percentage has been maintained. However, as the actual percentage is below forty percent, this percentage would not cause a tax loss, on the contrary, it would be preferable in order to provide an assurance to investors.

Employment of Foreign Personnel

A petroleum right holder may employ foreign personnel who are required for the performance of the petroleum transaction for a period of at most six months. To do so, they must obtain a certificate of residence for employment purposes, to be issued by the Ministry of Internal Affairs upon the favorable opinion of the Ministry of Energy and Natural Resources. The conditions imposed are that the provisions of the special laws are reserved and the employer fulfills the liabilities arising from other laws. At this point, the provisions of the Law on Employment Permits for Foreigners No. 4817 shall not be applied. In the event the employment period exceeds six months, the permit will be obtained in accordance with the provisions of the relevant law.

Prohibitions and Special Provisions

Pursuant to Article 22/12 of the Turkish Petroleum Law, on the basis of the whole crude oil and natural gas produced by petroleum right holders in petroleum fields they discovered after January 1, 1980, petroleum right holders will be entitled to export 35 percent in onshore fields and 45 percent in offshore fields, in the form of crude petroleum or finished product. The remaining part and the whole of the crude petroleum and natural gas produced from the fields discovered before the date of January 1, 1980 and the petroleum products derived therefrom shall be set aside for country requirements. The power to re-determine these ratios and to specify the principles and procedures in this regard shall lie with the Council of Ministers.


Pursuant to Article 26 of the Turkish Petroleum Law, the incentives that will be given for the investments that will be realized by petroleum right holders shall be determined by the Council of Ministers. This provision is a new provision, which did not exist in the Petroleum Law No. 6326. In this way, holders of petroleum rights are granted the right to benefit from the incentives for all other investments they make.


With the Turkish Petroleum Law, the national interest notion has been maintained in the purpose and scope of the law. With the abolition of the provision providing that the right of permit, exploration and operation license shall be in favor of the TPAO on behalf of the state, private companies will be able to enter the relevant field. New provisions have been adopted with regard to the period for which the exploration license may be granted. With the requirement to submit an investment plan with the extension request of the licenses, the cases where the license is extended without any investment are prevented. The requirement that the TPAO must be consulted before the fields whose operation licenses have expired can be put on auction has been adopted and TPAO has been granted a priority. The income tax deduction, whose reduction to forty percent has been subject to controversy, has been maintained as fifty-five percent. All these provisions aim to incentivize the exploration and production activities in the relevant field with a low cost, simplification of the operations and provide a competitive environment.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Herdem Attorneys at Law
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Herdem Attorneys at Law
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions