Turkmenistan’s attempts to expand its gas supply through Uzbekistan to the gas-poor republics of Tajikistan and Kyrgyzstan proved unsuccessful due to resistance from Tashkent, whose relations with Dushanbe and Bishkek have grown progressively less friendly.
Where will the Turkmen gas go?
Turkmenistan’s gas reserves are appraised as the fourth-largest in the world, after Russia, Iran and Qatar. The republic has large gas fields in the East and Northeast. Back since Soviet times, this gas has been supplied to Russia, and from there to Europe. The republic’s central and western regions have promising gas fields, including those on the Caspian shelf. The Southeast, near the border with Afghanistan, is home to the old, large Dauletabad gas field.
Finally, the Southeast is home to the super-giant Galkynysh gas field. Even though its declared reserves number at 21 trillion cubic meters of gas, many specialists question this figure, and give estimates two to three times lower. Nevertheless, all agree that the field is indeed a super-giant. That being said, it is stressed that most of Galkynysh’s gas is “wet” and has high sulfur content, thus requiring an expensive purification process. Conversely, this type of gas is good material for powerful gas chemical complexes and commercial production of sulfur and sulfuric acid.
In the late Soviet years, Turkmenistan produced around 90 billion cubic meters of gas per year. The majority of this gas was then transported to Russia via the “Central Asia-Center” pipeline system. Part of this gas was then sent for export via Russia.
During the post-Soviet years, the principal direction for Turkmen gas continued to be to Russia and for export via Russia, first and foremost to Ukraine. Another in a series of treaties was signed is 2003, according to which Turkmenistan would supply Russia 50 billion cubic meters of gas per year.
However, active gas cooperation between the republic and China had already begun to unfold by the middle of the first decade of the 21st Century; and soon enough, Turkmenistan concluded large-scale investment agreements with the PRC in the field of natural gas. For example, China received the Bagtyyarlyk “contractual territory” in the Lebap province in eastern Turkmenistan for gas reconnaissance and production. December 2009 saw the launch of the first line of the TUKC pipeline, stretching from Turkmenistan through Uzbekistan and Kazakhstan to China’s Xinjiang province, and the start of the construction of two more lines.
Furthermore, the second line of the pipeline from Turkmenistan to Iran was completed in 2009, which brought the potential of Turkmen gas export to Iran from 8 to 20 billion cubic meters per year.
It is notable, that in the beginning of the same year, 2009, a powerful explosion occurred on the “Central Asia-Center-4” pipeline, which practically stopped Turkmen gas exports to Russia for more than a year. This was followed by Ukraine’s refusal of Turkmen gas supplies via Russia. After this, according to the new contract, Russia agreed to import up to 30 billion cubic meters of gas per year from Turkmenistan. However, after resuming gas imports from Turkmenistan in 2010, Russia purchased only 10-15 billion cubic meters per year, and during the current year of 2015, it plans to buy only 4 billion cubic meters.
Iran, since the crisis began in 2008, has also started to actively transit the gas supply of its northern provinces to its own gas fields, and now it receives only 5 billion cubic meters of gas per year from Turkmenistan.
Turkmenistan’s attempts to expand its gas supplies through Uzbekistan to the gas-poor republics of Tajikistan and Kyrgyzstan proved unsuccessful due to resistance from Tashkent, whose relations with Dushanbe and Bishkek have grown progressively less friendly.
As a result, China has become the principal importer of Turkmen natural gas. The Chinese petroleum giant CNPC, apart from controlling the above-mentioned Bagtyyarlyk “contractual territory”, obtained the status of principal investor and operator of Galkynysh. By the beginning of 2015, Turkmen gas exports to the PRC exceeded 35 billion cubic meters per year. Apart from expanding the three lines of the TUKC (Turkmenistan-Uz
This line will not only increase supplies of Turkmen gas to the PRC, but it will, apparently, partially solve the aforementioned age-old problem of gas supply for Tajikistan and Kyrgyzstan. In other words, it will tie these Central Asian republics closer to Beijing.
After completing the construction of the two stages of the gas-cleaning plant on Galkynysh, China is planning to increase Turkmen gas imports by 45-60 billion cubic meters (bcm) per year. According to the latest data, the total Chinese imports of natural gas from Turkmenistan will reach 65 bcm by 2017, growing to 80-85 bcm by 2020.
At the same time, Turkmenistan could produce and export significantly more gas. It has new gas fields that “almost ready” for production. It has tremendous “dry” pipeline reserves. The problem is that these dry pipes lead to Russia, Kazakhstan, and Iran, to markets where there is practically no demand for Turkmen gas, with no prospects for increase in the foreseeable future. In order to supply gas to high demand markets, interested investors must be found, and new pipelines must be built.
Turkmenistan lacks its own funds for this, and even generating a balanced budget, with the current crisis conditions and skyrocketing prices on import goods, is impossible. In recent years, such post-Soviet “social guarantees” as nearly free electricity and gasoline have disappeared. The concurrent devaluation of the national currency, the Manat, has lead to a decrease in the real income of the population, with street protests already occurring in certain regions.
In other words, Turkmenistan vitally needs investments and strategic partners to bring it “gas riches” to new markets.
For this reason, one question becomes especially important: what markets?
TANAP or TAPI?
The “Southern Gas Corridor”, which the EU named a priority, with its TANAP project, which includes the transport of Turkmen gas via the Trans-Caspian Pipeline (TCP), has had the most publicity. The government of Turkmenistan has already announced that the reserves of the republic’s western and Caspian shelf gas fields are sufficient to supply TANAP with 30 billion cubic meters of gas per year via the TCP.
Furthermore, announcements were made that soon the giant gas fields in the southeast, including Galkynysh would also become sources for gas supplies to Europe via the TCP and TANAP, and that Turkmenistan plans to complete the first line of the “internal” “East-West” pipeline by the end of 2015. Investments into this pipeline are considered one of the main causes of Turkmenistan’s planned $1 billion 2015 budget deficit.
However, as we mentioned in the previous part of the article, the political and legal barriers to building the TCP have not gone anywhere.
Azerbaijan, which only talks about TANAP now in regard of Azerbaijani gas supplies from Shah-Deniz via a pipeline with a capacity of 16 billion cubic meters per year, clearly demonstrates this. Furthermore, a leading topic of discussion there is the possibility in principle of significantly increasing, specifically, Azerbaijani gas exports to Europe. In other words, Baku demonstrates no willingness to share the TANAP pipeline with Ashkhabad.
Daniel Rosenblum, the US Deputy Assistant Secretary of State for Central Asia, no less clearly demonstrates this in the statement that he made in Ashkhabad in late 2014. Rosenblum said (attention!!!) that while the US support the TANAP project, “The United States is more interested in the Turkmenistan-Afg
At the time of Rosenblum’s statement, the discussion around Europe’s Southern Gas Corridor was not nearly as intense, and there was no talk over a Trans-Caspian Pipeline. At that time, analysts hypothesized that the above-stated position of the US was dictated by the urge not to allow China to monopolize Galkynysh and its giant gas reserves. However, Washington’s subsequent actions, which demonstrated its disinterest in TANAP and the construction of the TCP, showed that much larger scale considerations dictated this US position.
Let us recall that the TAPI (Turkmenistan-Afghanistan-Pakistan-India) pipeline, with the multiple transformations its project sustained over the years, was supposed to supply Afghanistan, Pakistan, and India with between 30 and 90 billion cubic meters of gas per year. The current version of the project, announced by the four interested countries’ gas consortium, created in November 2014, is practically a minimal variant with 38 billion cubic meters per year. This means it cannot fully satisfy the growing demand. Already this year, the TAPI consortium intends to determine the leader and operator of the project and to begin construction.
Next, it is well known that the TAPI has to pass through very unstable regions of Afghanistan, including Herat and Kandahar provinces, which are not actually controlled by the authorities in Kabul (and it was actually the major military and political obstacle to the realization of the project all the time). It is clear that the plans to withdraw the international troops from Afghanistan announced by US President Barack Obama’s will only reduce the capability of Ashraf Ghani Government to control the country.
Nevertheless, the United States promises current (very ‘weak’ as we would like to emphasize once again) Afghanistan authorities very important ‘carrots,’ which the war-torn country will receive if it lays TAPI pipeline: 12-15 thousand well-paid jobs in the construction and subsequent operation of the pipeline and, most importantly, more than 1 billion dollars of investment inflows.
So why does the United States need this “pipe”?
Perhaps, one of the answers is worth looking for in the new trends in the development of the military-terrori
Turkmen authorities are seriously concerned about the appearance of ISIL’s black banners near their country’s border. These concerns are justified by the fact that many Turkmens are already fighting under this banner of the future Caliphate. And there are Turkmens not only from Turkey, Iraq, Syria, Iran, Afghanistan but also from Turkmenistan itself. And, attention, border incidents involving ISIL militants, and the Taliban members who swore allegiance to ISIL, are recently observed exactly in the sector of the Turkmen-Afghan border, where TAPI pipeline should be laid out and near which the gas giant Galkynysh is.
Although the TAPI consortium has already announced that the Indian company Gas Authority of India will guarantee the security of the pipeline construction and operation, it is a matter of the future. And the incidents on the border are occurring now.
Due to these incidents, Turkmenistan mobilized part of the reserve forces in February 2015. And at the border with Jowzjan province of Afghanistan, they started to dig a ditch 6 meters deep and also place the two-meter barbed wire barrier stretched over concrete poles. Ashgabat fears that already in the spring, when the passes in the mountain border areas of Afghanistan will be opened, ISIL may begin a large-scale offensive on the ‘Turkmen’ front.
On March 30, 2015, the Commander of the United States Central Command General Lloyd James Austin said at a meeting of the Senate Budget Committee that the Turkmenistan Government requested military assistance, including to supply military equipment and technology to ensure security on the Afghan border. And he added that the United States agreed to provide Turkmenistan such military assistance and plan to include its financing in the draft of the national budget of 2016.
However, international experience shows that this type of assistance from the United States never goes without a large ‘landing’ of American specialists in the operation of arms, instructors, and considerable security forces (usually from the so-called ‘private military companies’ – PMCs), which actually is supposed to appear in Turkmenistan as a result of this assistance. This force is expected to appear both near the Afghan border, and probably (since the threat of ISIL terrorism is more than serious, and the PMC specializes in fighting such threats!) near the largest gas fields…
To be continued.
Source (for copy): http://eu.eot.su/?p=8242
This is the translation of the eighth article (first published in “Essence of Time” newspaper issue 122 on April 8, 2015) by Yury Byaly of a series on the new round of global economic warfare. The ultimate goal of this war, of which gas wars is a part, is the weakening and dissolution of Russia. But disruption of Russian supply of gas will lead to lack of gas and rise of prices and some European economies might just not handle this. Since all of the global economy is intertwined, those who started this war want to make not just Russia, but many other countries become weaker in the end.