Turkmenistan Boosts Gas Export Capacity with East-West Link

Reuters

Belek, TURKMENISTAN, Dec 23 (Reuters) - Turkmenistan on Wednesday completed a pipeline that can ship gas from the world's second largest gas field to the West or, alternatively, boost eastbound shipments to China and, in future, to Pakistan and India.

The $2.5 billion East-West pipeline connects Galkynysh and other fields in the east of the country to its Caspian coast, from where a proposed Trans-Caspian link could deliver gas to Azerbaijan and then to Europe.

The Trans-Caspian pipeline (TCP) project, backed by the European Union, has so far remained on paper, partly due to disputes about the Caspian Sea's legal status and Turkmenistan's refusal to sign production-sharing agreements with foreign companies for major hydrocarbon deposits.

But President Kurbanguly Berdymukhamedov said on Wednesday that the availability of gas on Turkmenistan's western border could breathe new life into TCP.

"With the completion of East-West, cooperation with our European partners acquires new meaning," he said at the launch ceremony in the small town of Belek located close to the Caspian.

The 773-kilometre (483-mile) East-West link, which has a capacity of 30 billion cubic metres (bcm) a year, could also feed a proposed pipeline going along the coast through Kazakhstan to Russia.

However, the implementation of that project looks unlikely after Moscow, once Ashgabat's main customer, bought just 11 bcm of Turkmen gas in 2014 and will slash imports of the fuel to 4 bcm this year.

Another option is to use the new link to ship gas in the opposite direction. Western Turkmenistan, although not as rich in gas as the eastern regions, could eventually provide additional volumes for a pipeline that delivers 30 to 35 bcm of gas a year to China.

Turkmenistan this month started work on its part of a natural gas pipeline to Afghanistan, Pakistan and India (TAPI) which also originates near Galkynysh.

(Reporting by Marat Gurt; Writing by Olzhas Auyezov, editing by William Hardy)

Copyright 2016 Thomson Reuters. Click for Restrictions.

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