Turkmenistan International Affairs - The Times Of Central Asia

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Turkmenistan’s Gas and Türkiye’s Plans to Become a Gas Hub

A series of ongoing political consultations between Turkmenistan and Türkiye continued on 25–26 April, as a Turkmen delegation led by Deputy Minister of Foreign Affairs Ahmet Gurbanov visited Ankara, hosted by Turkish counterpart Burak Akçapar. Beyond the regular bilateral agenda of political-diplomatic, trade-economic and cultural-humanitarian cooperation, the two sides emphasized the implementation of bilateral agreements reached at the third Antalya Diplomatic Forum in early March, particularly the prospects for cooperation in the energy sector. On 1 March 2024, Turkmenistan and Türkiye signed two documents — a memorandum of understanding (MoU) and a letter of intent — aimed at strengthening cooperation in the natural gas sector. In theory, this seems to be a positive development for the two countries as well as for Europe. The two possible routes for Turkmen gas to reach Türkiye and Europe are (1) via the Caspian Sea and Azerbaijan, and (2) through Iran's existing pipeline infrastructure via a gas swap agreement. Neither one is likely to happen soon. The project to export Turkmen gas to Europe through a shore-to-shore high volume pipeline, at 31 billion cubic meters per year (bcm/y) is no longer alive after various parties have failed to realize it over the past quarter-century. It was bruited when it was announced that Turkmen President Serdar Berdimuhamedov planned to visit Brussels in late 2023 (which ended up not happening) and definitively killed when the initiative by American company Trans-Caspian Resources (headed by a retired U.S. ambassador to Turkmenistan) failed to persuade Ashgabat to construct short low-volume (8–11 bcm/y) "Platform Option" pipeline in the Caspian Sea. Gas "swaps" and Türkiye’s ambitions The idea of a "Turkish gas hub" arose from Russia's search to depoliticize trade between Gazprom and European firms by facilitating a platform where Gazprom's origination of the gas would be obscured and anonymized. Buyers and sellers could meet through Turkish intermediation. Türkiye, however, seeks to draw advantage by imposing the condition of long-term contracts with Gazprom for gas sales at below-market prices. This would guarantee a role for the Turkish intermediaries and, moreover, ensure for them a profit margin through mandatory service fees. "Swap" operations mean an exchange of gas amongst Turkmenistan, Iran and Azerbaijan; however, this would involve only a few billion cubic meters. Even if all participants agree, several questions still remain: Will swap transactions be profitable, given the price of gas in Europe? Even if Iran agreed to a Turkmen gas swap, would Tehran execute the agreement in good faith? In fact, Tehran would prefer to offer its own gas to Turkish and European markets, rather than transit competitive Turkmen gas through his territory. In addition, the gas that Azerbaijan produces for export already has contracted buyers under long-term agreements. Azerbaijan would be interested in the Turkish gas hub only if it should in future produce surpluses of gas that cannot be sold under long-term contracts. Then, such surpluses could be sold at a gas hub under short-term contracts, assuming that transit and profitability are guaranteed. Challenges to Türkiye’s...

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Kazakhstan, Turkmenistan and Afghanistan to Cooperate in Freight Transit

On April 27, Deputy Prime Minister of Kazakhstan Serik Zhumangarin, Director General of the Agency of Transport and Communications of Turkmenistan Mammetkhan Chakiyev, and Minister of Trade and Industry of the Afghan Taliban government Nuriddin Azizi met in Kabul. During negotiations, an agreement was made to develop more favourable and competitive tariffs for the passage of container trains from China through Kazakhstan and Turkmenistan to Afghanistan, and further afield to Pakistan, India, and Middle Eastern countries. To support the initiative, Afghan businesses have been invited to use the Kazakh terminal in China’s Xi'an Dry Port to consolidate goods for transport by rail. According to preliminary calculations, the delivery time for goods via the accelerated, uninterrupted route from Xi'an/Urumqi in China to Turgundi and Andkhoy in Afghanistan will be reduced to just 10-12 days, at a cost significantly cheaper than alternative modes of transport. Since the Kazakhstan-Turkmenistan-Afghanistan route could also be used for transporting goods from Russia and Belarus to India and the Middle East, it provides added impetus for the development of the North-South transport corridor.

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Doing Deals: At Paris Forum, Turkmenistan Makes a Pitch to the West

OPEC’s secretary general appeared on the video screen in a conference hall in France and ticked off the statistics that have made Turkmenistan such a tantalizing prospect as an energy provider for Europe over the years, despite the convoluted geopolitics and high costs of moving natural gas from Central Asia to the West. “It is among the top 10 global natural gas producers, and the fourth largest in terms of proven gas reserves. And it has plans to expand its oil production capacity,” Haitham Al-Ghais told delegates to the state-backed Turkmen Energy Investment Forum, held in a plush hotel in Paris on April 24-25. The speech from OPEC headquarters in Vienna was short and upbeat. It came at a time when Turkmenistan, a traditionally isolationist country, is seeking to diversify energy customers and as Europe reduces demand on Russian natural gas amid war in Ukraine. Turkmenistan, which is not a member of the Organization of the Petroleum Exporting Countries, has long exported gas to China, its biggest customer. The Turkmen government says the construction of a pipeline that would deliver gas to India via Pakistan is making progress, though the infrastructure would pass through Afghanistan, where security is a perennial concern. Last year, Turkmenistan’s foreign ministry spoke positively about plans for a Trans-Caspian pipeline that would deliver gas to Europe, an idea that has circulated since the 1990s but is opposed by Moscow. Also, gas demand has been dropping in Europe and Brussels is reluctant to revive the complex Trans-Caspian project and its undersea pipeline, according to the Warsaw-based Centre for Eastern Studies. There has also been talk of sending gas to Europe through Iran under a gas swap agreement, though international tensions – evident in the recent strikes by Iran and U.S.-backed Israel on each other’s territory -- are likely to persist. “The options, including transport via the Caspian Sea and Azerbaijan or through Iran’s pipeline infrastructure, reflect the complex regional dynamics and the need for diplomatic agreements to facilitate gas transit,” Melike Akin wrote in a March 7 analysis for the Ankara Center for Crisis and Policy Studies, a research center. Ankara is the capital of Turkey, which said in March that it will begin receiving some Turkmen natural gas. Details on the delivery are lacking, but the transfer could serve as a playbook for Turkmen supplies to Europe, with Ankara positioning itself as a gas trading hub between Eurasia and the West. President Serdar Berdimuhamedov of Turkmenistan said in a message to the Paris energy conference that priorities include collaboration with foreign companies on oil and gas facilities in the Turkmen section of the Caspian Sea, development of the huge Galkynysh gas field and construction of the TAPI pipeline to South Asia. The acronym stands for Turkmenistan-Afghanistan-Pakistan-India. The president noted that Turkmenistan had made “significant progress” toward reducing emissions when it signed the Global Methane Pledge at the United Nations meeting on climate change, or COP-28, in Dubai in December. Under the agreement, more than 150 nations...

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Central Asian Countries Set 2024 Quotas for Amu Darya, Syr Darya River Water Usage

Last week in Kazakhstan, delegates came together for the 87th meeting of the Interstate Commission for Water Coordination (ICWC) of Central Asia, where they discussed the potential and limitations of regional water reservoirs ahead of the 2023-2024 agricultural growing season. According to the ICWC, some of the more pressing questions focused on confirming limits of water usage for the 2024 growing season for the Syr Darya and Amu Darya river basins and the prognosis for water release from the reservoirs in those basins. There's still no information on how much water will be sent to the Aral Sea basin. In accordance with the quota, the draw on water from the Amu Darya watershed will be 56 billion cubic meters for the year, with about 40 billion cubic meters to be used in the April-to-October growing season. As stated in the ICWC agreement, Uzbekistan will receive 16 billion cubic meters, Turkmenistan 15.5 billion cubic meters, and Tajikistan will get 6.9 billion cubic meters. The Syr Darya's water use quota for this year's growing season is around 11.9 billion cubic meters, with 8.8 billion cubic meters going to Uzbekistan, 1.9 billion cubic meters for Tajikistan, 920 million cubic meters for Kazakhstan, and 270 million cubic meters for Kyrgyzstan. According to the ICWC, the totals for irrigated lands by Central Asian country are 4.3 million hectares in Uzbekistan, 2.5 million hectares in Kazakhstan, 1.9 million hectares in Turkmenistan, 1 million hectares in Kyrgyzstan, and 680,000 in Tajikistan.

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Port of Turkmenbashi Begins Cargo Transport With Russian Port of Olya

Turkmenistan's Caspian Sea port of Turkmenbashi has started shipping cargo to the Russian port of Olya on the Turkmenistan-flagged ferry Bagtyyar, according to a report from the Turkmen Sea and River Routes (Turkmendeñizderýaýollary) Agency. The agency calls this voyage an important step towards the development of trade relations between Turkmenistan and Russia -- and an opportunity for the national merchant fleet to deliver perishable goods to their destination on time. The Bagtyyar, which according to Marine Optima was built in 2015 and has a summer deadweight tonnage (DWT) of just over 3,300 tons, is equipped with modern safety and navigation systems which guarantee cargo safety. Additionally, the Turkmen side says it's ready to open a shipping route for grain crops to be transited from the southern regions of Russia through the Caspian Sea to the countries of the Persian Gulf and other markets. At the port of Turkmenbashi, goods can be transshipped through the free zone without customs fees for up to three years. 2018 saw the opening of the port of Turkmenbashi, which increased access to markets throughout the Middle East and Europe. The project, worth $1.5 billion, was carried out by Gap Inşaat, a company based in Turkey. With the exception of oil products, the port can handle 17 million tons of different types of cargo annually. Four terminals (general cargo, container, bulk cargo and car ferries) are located on an area of more than 150 hectares.

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Turkmenistan and USA Set to Strengthen Partnership

On 14 April, delegations led by Rashid Meredov, Minister of Foreign Affairs of Turkmenistan and John Pommersheim, US Deputy Assistant Secretary of State for South and Central Asian Affairs, attended an annual political consultation in Ashgabat. The meeting focused on the current state and prospects for the development of Turkmen-American relations in political, trade, economic, ecology, culture, education, and humanitarian sectors. According to the Turkmen Foreign Ministry, both parties confirmed their commitment to cultural and educational programs, through monthly meetings, and approved a joint road map in the field of education. The American delegation welcomed Turkmenistan's accession to the Global Methane Commitment which underlines both countries’ determination to resolve environmental problems and create sustainable socio-economic development. The parties welcomed the establishment of inter-parliamentary cooperation as essential for maintaining contacts and coordinated approaches to resolving pressing issues.