Russia pushing Turkmenistan to European gas market

Russia pushing Turkmenistan to European gas market

Baku, Azerbaijan, Jan. 8

By Elena Kosolapova - Trend:

Russia has completely stopped buying gas in Turkmenistan since January 2016. This can stir this Central Asian country's interest in the European gas market.

Russia's decision was expected. The export of Turkmen gas to Russia decreased tenfold over the past decade. Russia bought about 41-42 bcm a year from Turkmenistan in 2006-2008. The import has dropped to 10 bcm a year since 2010. The Russian Gazprom announced about the reduction of the Turkmen gas purchase by more than twofold - up to 4 bcm per year in 2015.

But even these supplies were problematic. The sides did not agree on the price of gas. Gazprom filed suit against Turkmengaz in the Stockholm Court of Arbitration with intention to revise the contract value of the purchased Turkmen gas as energy prices dropped in the world.

Turkmengaz announced that Gazprom has not paid for the already supplied Turkmen gas since early 2016. According to the Turkmen side, Gazprom simply went bankrupt because of the crisis and sanctions.

On one hand, the supply of gas in such small volumes has no role for the economy of both countries. Gazprom said in early 2015 that there is no technological need for the purchase of gas from abroad regardless of the source.

Gazprom said it is able to ensure both the needs of the market in any region of Russia and the supply of gas to its customers in Europe and, in the long term, in Asia, through own resources. Considering the fact that Russia, according to BP, ranks second in the world in terms of gas reserves - 32.6 trillion cubic meters, there's no point to doubt Gazprom's statement.

Gas supplies to Russia for Turkmenistan amounted in 2014, for example, to only one-third of total export volume, mainly due to the fact that more than 25 billion cubic meters were sold to China. In 2015, because of the significant reduction in exports to Russia, the share of export in Russian direction fell dramatically.

The fact that Ashgabat lost one of the export routes, which are only three, including China and Iran is important in the issue of termination of Turkmen gas deliveries to Russia. Of course, China remains the most important market, the demand for gas of which will only grow. For 10 years, the demand for gas in China increased by 4.5 times to 185.5 billion cubic meters in 2014.

There is another export route - Iran. Iran has huge gas reserves itself (34 trillion cubic meters, according to BP), which puts the country to the first place in the world. In addition, in the light of lifting of sanctions from Iran, the country may soon begin development of new gas fields and become from a partner to a competitor of Turkmenistan. So it's not necessary to count on this route.

There may be another export route in the future - the construction of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline started in Dec. 2015, which will supply Turkmen gas to promising markets in South and Southeast Asia.

However, according to official statements, only the construction of this pipeline's Turkmen section will last for 3 years. Building plots in the transit countries, counting security problems in the region, may take even more time. Therefore, this export route can be expected only in the long term.

It is most likely in such situation that Turkmenistan's interest in European gas market will further increase. The Central Asian country has already done a great deal to supply gas to Europe.

The commissioning of the East-West gas pipeline in Dec. 2015, is intended to transport natural gas from the biggest deposit in the country's eastern regions - Galkynysh - to European markets. Azerbaijan, Georgia and Turkey, lying on the route from Turkmenistan to Europe, are willing to be transit countries.

Many experts believe that for Turkmen gas, in order to become finally a reality in Europe, it's only necessary the construction of a 300- km gas pipeline across the Caspian, which is not difficult from a technical point of view.

However, for this, Europe must become more resolute in its intention to get Turkmen gas and take part in the construction of the Trans-Caspian gas pipeline, in which is interested not less than Turkmenistan.

Otherwise, the statement of Maroš Šefčovič, Vice-President of the European Commission for Energy Union, about the plans to get Turkmen gas in 2019 will be nothing but populism. When Turkmen gas is released to the huge Southern and Southeastern Asian markets, Turkmenistan's interest in European market can vanish.

Turkmenistan ranks fourth in the world in terms of gas reserves - 17.5 trillion cubic meters of gas. Currently, the country produces more than 75 billion cubic meters of gas per year, and it is planned to increase production to 230 billion cubic meters by 2030, most part of which will be exported.

---

Elena Kosolapova is Trend Agency's staff journalist, follow her on Twitter: @E_Kosolapova

Subscribe to Trend in Google News! Subscribe
Memory of January 20 tragedy victims honored in Azerbaijan's Shusha (VIDEO)
Memory of January 20 tragedy victims honored in Azerbaijan's Shusha (VIDEO)
Azerbaijan's minister of health talks quarantine regime
Azerbaijan's minister of health talks quarantine regime
Work related to Armenia's environmental crimes in Azerbaijan's Karabakh in progress - ministry
Work related to Armenia's environmental crimes in Azerbaijan's Karabakh in progress - ministry
Loading Bars
Latest
Can hydrogen market be cartelized?
Azerbaijani NBCO eyes boosting car loan portfolio
Memory of January 20 tragedy victims honored in Azerbaijan's Shusha (VIDEO)
Indian economic recovery yet to attain durability: Icra
Russia records another 38,850 coronavirus cases, highest daily number since Nov 13
PM to launch India-assisted projects with Mauritius counterpart Jugnauth today
Rapid growth of hydrogen to underpin rising demand for nickel, zirconium
Azerbaijani State Border Service to purchase building materials via tender
Iran’s CBI discloses data on balance of bank loans
Uzbek Statistics Committee reveals amount of construction work done in 2021
Azerbaijan's minister of health talks quarantine regime
Turkmen garment factory ramps up production
Iran reveals COVID-19 data for January 20
IEA expects Azerbaijan to increase oil output in 2022
Turkish MoD shares publication on anniversary of January 20 tragedy in Azerbaijan
Work related to Armenia's environmental crimes in Azerbaijan's Karabakh in progress - ministry
Iran’s Bahar Azadi gold coin price continues to rise
Turkish, Armenian special reps to discuss confidence-building measures - FM
IEA evaluates Azerbaijan’s OPEC+ compliance
Kazakhstan crude and condensate production estimated to go up in 2022
European Hydrogen Backbone joined by six more companies
Swiss Expo inks solar power purchase agreement in Poland
Кazakh Electricity Grid Operating Company opens tender to buy spares for vehicles
Turkmenbashi refinery opens tender to purchase necessary equipment
EBRD to allocate loan for Turkey’s renewable energy sector
Azerbaijan develops action plan to provide liberated areas with internet
Georgia shares data on trade turnover with Azerbaijan
Russian MFA talks about expansion of transport corridors within GUAM
Recognise ‘Hinduphobia’ and violence against Buddhists, Sikhs too: Indian envoy to U.N.
Work related to Armenian crimes against Azerbaijanis continues - Prosecutor General
Momentum in India's favour, need to prevail over COVID-19: Deloitte CEO on economic development
Central Bank of Iran shares data on exchange of bank checks countrywide
Proud to hold TEKNOFEST int'l aviation, space, technology festival in Azerbaijan - Turkish Baykar Makina
EU special rep for South Caucasus to visit Azerbaijan
Iran boasts potential to vastly increase exports to Russia
India extends suspension on international flights till February 28
Kazakh Gas Processing Plant opens tender to buy electric engines
Companies from UAE, Netherlands to build solar photovoltaic stations in Uzbekistan
Israel signs $3.4 bln submarines deal with Germany's Thyssenkrupp
Azerbaijan eyes holding clinical trials of Turkovac COVID-19 vaccine soon
Turkmen state concern to purchase material and technical resources via tender
Georgia names main goods in domestic exports in 2021
Azerbaijani minister talks potential omicron infection rate among local COVID-19 patients
Azerbaijani people honor memory of victims of January 20 tragedy (PHOTO/VIDEO)
Iranian banks issue big loans in services sector
UN Resident Coordinator in Azerbaijan expresses condolences in connection with January 20 tragedy
Ambassador of Kazakhstan to Azerbaijan honors memory of victims of January 20 tragedy (PHOTO)
Uzbek association signs agreement with Russian enterprises to develop textile industry
Inflation accelerating worldwide: How Azerbaijan responds?
Azerbaijan honors memory of martyrs of January 20 tragedy by minute of silence (PHOTO/VIDEO)
Turkish embassy in Azerbaijan shares publication on 32nd anniversary of January 20 tragedy
Turkmenistan's TML eyes co-op with Ukraine's Smart Maritime Group
Uzbekistan to strengthen cooperation with Saudi company in energy field
Leadership of Azerbaijani MoD visits Alley of Martyrs (PHOTO)
Georgia’s revenues from tourism to surge in 2022 – Galt & Taggart
Iran provides several loans in trade sector
January 20 events strengthened resolve of Azerbaijani people for independence - aide to president
Embassy of Kazakhstan in Azerbaijan issues statement on 32nd anniversary of January 20 tragedy
Georgia publishes COVID-19 data for January 20
This irresponsible behavior of French FM also undermines bilateral international obligations of France - Azerbaijani MP
Uzbek Thermal Power Plants JSC to implement major investment projects
Kazakhstan increases production and import of kerosene for 10M2021
Iran reaches significant agreements with Russia in energy sector – minister
Valiant Azerbaijani people stood up for independence on January 20, 1990 - Turkish president's adviser
Loan portfolio of Azerbaijani non-bank credit organization more than doubles
Azerbaijan Transport Agency talks number of passengers on bus trips to liberated areas
Armenia must properly assess new geopolitical realities in region – Aide to Azerbaijani President
Russian Economy Ministry talks about implementation of joint transport projects with Azerbaijan
Georgia to attract new investments in energy sector – minister
Kazakh Samruk-Kazyna, Russian companies to invest in chemical projects
CNPC branch in Turkmenistan opens tender for repair of compressors
Uzbekistan shares domestic COVID-19 data for January 19
Iran's Energy Exchange announces products to be on sale on January 22
Iran establishes container shipping route from Chabahar port to Indian ports
President Ilham Aliyev and First Lady Mehriban Aliyeva visit Alley of Martyrs on 32nd anniversary of 20 January tragedy (PHOTO/VIDEO)
President Raisi's visit to Russia - fundamental change in Iran's international relations - Iran's VP
Azerbaijani oil prices increase
Iran sees increase in exports to Oman
Oil prices hover around 2014 highs, supported by supply concerns
Higher oil revenues to boost Turkmenistan's GDP growth - Fitch
Iranian currency rates for January 20
Azerbaijan's FM meets with head of IAEA in Vienna (PHOTO)
Azerbaijan expects another wave of COVID-19 pandemic - Health Committee of Parliament (VIDEO)
Azerbaijan's Mediation Council, MUSIAD sign cooperation protocol (PHOTO)
ITFC extends $15M line of financing facility to Uzbek Industrial and Construction Bank
ITFC extends US$ 15 Million Line of Trade Financing Facility to Invest Finance Bank
Switzerland recognises Georgian Covid-19 certificates
Economy min: Facilitating banking transactions part of Iran-Russia agreements
Turkey expects coronavirus cases to peak in February
Number of COVID-19 cases in Kazakhstan tops 1,100,000
Chinese bridge at Pangong Tso nears completion, show satellite images
Beijing city raises vigilance as local COVID cases tick higher before Olympics
Over 300 mln COVID-19 cases confirmed all over world, WHO says
U.S., UK launch talks to resolve steel, aluminum dispute
India should adopt risk-based approach not blanket bans to contain Covid - WHO India head
Turkey, UAE sign FX swap deal worth $5 billion
Covid-hit microfinance industry in India seeks higher credit guarantee scheme
Excellent Iran-Russia ties serving strategic goals - Iranian president
Turkey soon to leave currency volatility behind: Erdogan
Cryptocurrency Bill in India unlikely to be introduced in upcoming Budget session
All news