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Iran, Turkmenistan sign agreement on gas-for-equipment barter deal

Business Materials 18 December 2012 14:14 (UTC +04:00)
Iran and Turkmenistan today have signed a gas-for-equipment barter deal, Fars reported citing Iranian diplomatic sources.
Iran, Turkmenistan sign agreement on gas-for-equipment barter deal

Azerbaijan, Baku, Dec. 18 /Trend S.Isayev, T. Jafarov/

Iran and Turkmenistan today have signed a gas-for-equipment barter deal, Fars reported citing Iranian diplomatic sources.

Previously it has been reported that Iran is in debt for about $1 billion to Turkmenistan for gas imports, and is working out on a deal to offer its Central Asian neighbor other commodities, instead of money.

Due to international restrictions, Iran has difficulties with transferring funds to Turkmenistan as payment for the gas imports.

According to the newly signed agreement, Iran would be importing gas from Turkmenistan, and in return would supply Turkmenistan with equipment for gas and oil industry.

It has been previously noted that for some six months, the gas imports from Turkmenistan have been unstable, so Iran's oil minister Rostam Qasemi announced Iran's discontinuation of importing gas from Turkmenistan.

Within the signed barter deal, Turkmenistan should be supplying Iran with some 40 million cubmeters of gas per day.

Turkmenistan and Iran have a common land border. They are neighbours on the Caspian Sea. The oil and gas sector is a strategic direction of cooperation.

Turkmen gas supplies to Iran began after commissioning the Korpedje-Gurtguyy gas pipeline in 1995. In 2009, the two neighbouring countries opened up additional capacity on the Dovletabad-Sarahs route.

A related branch over the territory of Iran from Sarakhs to the settlement of Sangbast through Hangeran was opened in November 2010.

Tehran and Ashgabat are negotiating to increase Turkmen gas supplies to Iran. Iranian media reported in late November that during the past six months, Iran received an average of five million cubic meters of gas per day from Turkmenistan.

Taking into account the results of the negotiations between the two countries, the volume of supply is expected to increase up to 40 million cubic meters gas in two to three weeks.

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