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China to increase imports of natural gas from Turkmenistan

Oil&Gas Materials 6 March 2012 19:40 (UTC +04:00)

Azerbaijan, Baku, March 6 / Trend V.Zhavoronkova /

China will continue to increase gas imports from Turkmenistan, General Director of Russian National Energy Institute Sergey Pravosudov believes.

"For China supplies of Turkmen gas are of great importance, and it will increase them," Pravosudov told Trend on Tuesday.

China started the construction of the eastern part of the second branch of the pipeline "East-West" to Hong Kong, which eventually will transport raw materials from Central Asia, in particular from Turkmenistan, Chinese mass media outlets reported.

The main supplier of gas in Central Asia is Turkmenistan, from where pipeline to China was commissioned via Uzbekistan and Kazakhstan in December 2009. The project was a first for China's energy corridor, designed to import foreign natural gas.

It is assumed that the new pipeline will run along the seabed between the city of Shenzhen in the south of mainland China and Hong Kong. This project is part of a second gas pipeline "West-East", via which natural gas comes from Central Asia to China's two economic units in the deltas of the Yangtze and Pearl River.

Pravosudov said the traditional importers which are China, Russia and Iran will remain real buyers of Turkmen gas. Europe, in his opinion, is still in the project, since Turkmenistan do not have a signed agreement on supplies with the EU.

"China's role as a purchaser of gas from Turkmenistan will increase since for its other importers this matter is not as important as for Beijing," said the expert.

He noted it is also clear that the volume of gas coming from Turkmenistan to China, will continue to grow for the reason that the Chinese market will grow rapidly.

"According to forecasts for 10 years gas consumption in China will increase from 100 to 300 billion cubic meters a year, which is a significant increase," said the expert.

Since the country will need 200 billion cubic meters of additional gas, Turkmenistan may not have enough gas to cover the entire Chinese market, let alone its exports to other destinations, Pravosudov believes.

In his opinion, the Turkmen leadership, talking about diversification of gas exports, is trying to get the highest price for it.

Talking about another possible direction of Turkmen gas exports - to India by pipeline Turkmenistan - Afghanistan - Pakistan - India (TAPI), the expert noted that the main problem in implementing it is the situation in Afghanistan.

"India is interested in getting natural gas, Turkmenistan is interested in selling it, but the main problem is in Afghanistan because it is far from stability, and there are no preconditions that something will become better," said Pravosudov.

In his opinion, it is very likely that TAPI will remain on paper.

The base document for the promotion of the project is Ashgabat interstate agreement of the States Parties on start of the practical implementation of the TAPI project signed at the end of 2010. The agenda includes questions of transit payment and security of the project.

The design capacity of the pipeline is up to 33 billion cubic meters of gas per year.
Buyers are gas companies of Pakistan and India. The project is promoted by the Asian Development Bank. Resource base, in addition to Dovletabad field, is the largest field in Turkmenistan, namely "Southern Yoloten - Osman" ("Galkynysh"). The length of the pipeline may reach 1735 kilometers.

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