28 september 2020

Central Asia news

Experts doubt that Turkmenistan has enough gas for all customers

16.07.2007 09:53 msk


Business Turkmenistan

Turkey believes it has found gas for Nabucco. Ankara intends to get it mostly from Iran and whatever else in terms of gas is needed in Turkmenistan. Turkmenistan has yet to give its consent to join he project but experts doubts that it has enough gas for all customers.

The Turkish-Iranian memorandum of energy cooperation was signed last Friday. IRNA (Iran) reports that the agreement stipulates construction of a gas pipeline between Iran and Turkey and involvement of Turkish companies in development of South Pars gas field in Iran. The gas produced there will be sold to Iran and pumped into Nabucco, the gas pipeline that will eventually connect Turkey and the European Union (to quote a senior Turkish official).

Iran has the second largest reserves of gas in the world (27.5 trillion cubic meters according to Oil & Gas Journal) but a rapid growth of domestic gas consumption makes it a net-importer. PFC Energy reports that Iran produced 87 and used 89 billion cubic meters of gas in 2005. "Iran will export 30 billion cubic meters of gas to Turkey every year, and the bulk may include Turkmen gas as well," Reuters quoted its source in Ankara as saying. It will have Nabucco running at nearly the planned capacity (31 billion cubic meters). A senior Turkish official told Reuters the other day that negotiations over gas transit via Iran or "reanimation of the project of a Trans-Caspian gas pipeline" were under way with Turkmenistan.

Neither the Iranians nor Turks ever said they had secured Turkmenistan's consent concerning gas transit to Europe. Turkmen state officials themselves remain unavailable for comment. In the meantime, some of the gas Turkmenistan has been exporting to Iran is liquefied (8 billion cubic meters in 2006). Ajdar Kurtov of the Russian Institute of Strategic Studies claims that Turkmenistan produces 400,000 tons of liquefied gas nowadays (equivalent of 544 million cubic meters). There are two gas pipelines connecting Turkmenistan and Iran these days - between Korpeje and Kurt-Kui (built in 1997, it had its annual running capacity recently upped from 8 to 12-14 billion cubic meters) and the one between Artyk and Luftbad (under 1 billion cubic meters, the pipeline went on line in 2000). Kurtov believes that Turkmen gas transit to Europe via Iran will require extension of the existing infrastructure. As things stand, the gas imported from Turkmenistan is used up by the northern Iranian provinces.

Turkmenistan has two long-term gas export contracts. Gazprom bought 42 cubic meters of gas from Turkmenistan in 2006, and the volume is expected to reach 70-80 billion cubic meters after 2009. Russia, Kazakhstan, and Turkmenistan agreed to expand the gas transportation system and up gas export, this May. The April 2006 agreement between Turkmenistan and China stands for the sale to 30 billion cubic meters of gas as of 2009 every year for the next three decades. Experts wonder if Turkmenistan has enough gas to meet all its commitments to partners all at the same time.

Spokesmen for Gazprom decline comment on the plans of Turkmen gas transit via Iran and only refer to the 25-year gas contract with Turkmenistan. Valery Nesterov of Troika-Dialog is convinced in the meantime that the Turkish-Iranian project may challenge the Russian North Caspian Gas Pipeline and South Stream only in some distant future. The project is fairly raw, Iranian-US conflict makes it extremely risky, and Turkmenistan may lack the gas it promises its partners.

Vasily Kashin, Irina Reznik

Vedomosti, July 16, 2007, p. A3

&Translated by Ferghana.Ru