 |
HOT “GAS” SUMMER
STANISLAV PRITCHIN,
Political analyst, Moscow
This summer was hot not only in terms of weather. From May to August 2007 construction of three gas pipeline in the Caspian region has been launched. The Caspian Gas Pipeline was the first project to be set up in 2007. The Declaration “Of construction of the Caspian Gas Pipeline” was issued as a result of the sudden visit of the Russian President Vladimir Putin to Turkmenistan and Kazakhstan. The declaration reads that “before September 1, 2007” the participant countries “will prepare and sign the Agreement on cooperation of the four states (Uzbekistan has joined the declaration – the author’s annotation) in reconstruction of the existing gas transportation system and creation of new facilities to transport natural gas of Central Asia”.
The project is expected to consist of two phases. Until 2010 the existing Central Asia-Centre-3 pipeline going from the western part of Turkmenistan and having the capacity of 10 billion cubic meters a year will be repaired. In 2006 it transported 0.4 billion cubic meters. In the second phase – before 2017 – a new branch with the capacity of 20 billion cubic meters may be constructed. The project also includes the increase in the Central Asia-Center system (branches 1, 2 and 4) capacity from 60 billion cubic meters to 75-80 billion cubic meters after 2010. The Turkmen South Yolotan deposit with reserves of 1.7 trillion cubic meters is supposed to become the source for the Caspian Gas Pipeline. This way, even at the declaration stage, the project implementation term, its capacity and source of raw materials are prescribed.
During the concluding press conference President of Turkmenistan Gurbanguly Berdimuhamedov and his Kazakh counterpart Nursultan Nazarbayev stated that the Caspian Gas Pipeline’s implementation would not impede the construction of its alternative, Transcaspian project.
Today the USA is aggressively lobbying for that project. In August the U.S. Assistant Secretary for Economic and Energy and Business Affairs Daniel S. Sullivan visited Ashgabat and Baku. As a result of the negotiations the U.S. Trade and Development Agency and the State Oil Company of Azerbaijan signed the grant agreement on doing researches for the Transcaspian oil and gas pipeline projects to the amount of 1.5 billion dollars. There are many questions about the American official’s visit. The grant money has been allocated only to Azerbaijan. Neither Turkmenistan nor Kazakhstan, which are expected to become the main oil and gas suppliers, has received anything. Neither the duration of the project nor its engineering data nor the crucial thing, namely the amount of available raw materials to fill the pipeline, are stated, at least, officially. The agreement signing looks like a PR campaign rather than a move to implement the project. For 15 years a lot of problems have prevented the Transcaspian pipeline from being constructed. Neither of them has been solved yet. Firstly, nobody knows the real amount of gas reserves in Turkmenistan, since all the results of gas audit carried out by the Turkmen and foreign experts have been classified. Apart from that, according to the current agreements alone, Ashgabat must supply its partners with over 2 trillion cubic meters of gas within 30 years, which is comparable to the officially ascertained Turkmen reserves. Secondly, the project is very expensive, it costs 11 billion dollars. Thirdly, the legal status of the Caspian Sea has not been determined yet. There are serious tensions between Azerbaijan and Turkmenistan about the possessions of some disputed deposits. Thus, the observers believe that there is a slight chance that the Transcaspian gas pipeline project will be implemented in the short or medium term.
The Central Asian gas will be supplied to the east again thanks to the activity of the Chinese officials and their Central Asian colleagues. In 2005, during late Turkmen President Saparmurat Niyazov’s visit to Beijing, the agreement was singed on construction of a pipeline to China with the capacity of 30 billion cubic meters a year. The agreement provides for China’s participation in the gas prospecting and production in Turkmenistan in the undeveloped large South Yolotan field (Russia hopes that it should become a basis for filling the Caspian Gas Pipeline). New President of Turkmenistan Gurbanguly Berdimuhamedov confirmed the previous agreements. The pipeline was to go through either Kazakhstan or Uzbekistan. But, after the SCO (Shanghai Cooperation Organization) summit in Bishkek it was announced that President of Kazakhstan Nursultan Nazarbayev and Chinese leader Hu Jintao had signed the agreement on the Turkmen gas transportation through Kazakhstan. The project must be implemented before 2009.
As regards this route, the situation is unclear. Firstly, it is not evident what gas source will be used for the pipeline. It turns out that both the Russian and Chinese projects reckon on the same gas deposits and volumes. One should keep in mind that, for the time being, South Yolotan deposit is not being developed, and the pipe going to China will have been built later. The whole route has not been traced yet. But it is known exactly that a part of the gas pipeline will go through Kazakhstan. Beijing would like the pipe to go through gas-rich Uzbekistan. But Tashkent is not on friendly terms with Ashgabat and Astana. For the present, it is unknown how expensive the gas will be. On the one hand, the Chinese do not like paying much and, as a rule, they calculate the raw materials price when they are delivered to Beijing or Shanghai (recently Russia has often met its partners halfway in matters of the purchase prices). True, the oil pipeline from Kazakhstan to China (Atasu-Alashankou) runs and develops, and the price policy has not roused Astana’s censure.
Thus, in the summer 2007 we have three competing projects of gas export from Central Asia. The first, the Russian Caspian Gas Pipeline, consists in modernization of the existing facilities; two new projects, the Transcaspian and Transeurasian routes, will go to the EU and China, respectively. The competition becomes severe because all the projects count, in the main, on the same gas volumes. Signing of the agreement on construction of the Caspian Gas Pipeline set on September and subsequent implementation of the project will show if Russia can acquire, at least, the greater part of the Central Asian gas.
August 31, 2007
|
|
|
