Turkmen gas sector: China's investment penetration

Turkmenistan, Ashgabat, June 24 / Trend , G.Hasanov/

Chinese Vice-Premier Li Keqiang has preferred to make his first stop in the Euro-Asian tour in Ashgabat. It can be assumed that he will legalize a loan of three billion dollars, promised by Beijing.

These funds are intended for industrial development in eastern Turkmenistan, South Iolotan field, which is included in the world's top four giants, and thus, will allow China to expand its presence further on the Turkmen market in the future which is felt in the world's many capitals.

In the Chinese government, Keqiang is responsible for financial and economic activities, and his Turkmen counterpart Tachberdi Tagiyev who met him at the airport - for the development of fuel-energy complex. A while ago, he reported on his fruitful negotiations in Beijing on China's allocating impressive loans.

Chinese journalists who accompanied one of the influential leaders of the Celestial Empire report that Keqiang in Ashgabat made a speech, not having time to leave the ramp. "China and Turkmenistan have enjoyed healthy and steady development in bilateral relations since the two countries established diplomatic ties in 1992," he said.

The Chinese official's confidence is understandable. Turkmenistan may export its gas to China via a pipeline being built through the territory of Uzbekistan and Kazakhstan in late 2009. Initial volumes will be small - about 5 billion cubic meters of gas (design capacity - up to 40 billion).

First among the foreign partners of Turkmenistan, the CNPC company has received access to develop onshore gas fields, particularly, on the bank of the Amu Darya River in which the U.S., Turkish and Japanese companies were interested, and the Turkmen gas will be transported to China from there.

Experts note that Beijing can become a "serious" strategic partner for Turkmenistan for a long time. And this, while Ashgabat attempts to provide itself with multiversional energy flow, is holding difficult price negotiations with traditional partners, including Moscow and Tehran (importing small volume for the border areas), and protracted - with potential Brussels and Washington (Turkmen Vice-Premier Rashid Meredov is currently holding negotiations there). According to witnesses who visited the Lebap region where the "Century building" is conducted, the Chinese factor is felt everywhere, beginning from supplying the local market with the Chinese consumer goods.

On June 23, Turkmen President Gurbanguly Berdymuhammedovlodged a serious complaint against Tagiyev and vice-premier on transport due to inadequate development of sectors over which they supervise and demanded immediate action to ensure the unconditional achievement of the parameters of growth, the National TV Altyn Asyr reported. The Turkmen head stressed that the fuel and energy complex were a kind of locomotive of the national economy.

The slowdown of rates in the fuel and energy complex is understandable. It has been nearly two months that the Turkmen gas export to Russia has been halted. Initially, its reason was the accident at the Central Asia-Center (CAC) main. At this stage, Moscow proposes to re-consider the terms of the long-term contract to reduce the volume of purchases or the cost, by motivating these initiatives with the ongoing global crisis and thus, drop in demand on the energy market. The talks on this issue have not yet yielded fruits.

The moment of truth has come for the West, linking its hopes to gain direct access to the Caspian Sea resources via the Nabucco pipeline project. This project aims to reduce energy dependence of the Old World from the Russian gas supply. To be hostages of the strained Moscow-Kiev relations (providing transit) during the January frost paid much for Europeans, especially under the global economic crisis.

In this regard U.S. Department of State Special Envoy Richard Morningstar marked that Russia must be concerned not with U.S. support for Nabucco, but projects implemented by China in Turkmenistan, Trend correspondent in Washington said.


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