MONTREAL - Figures given in the recent
confirmation by British auditors Gaffney Cline
that Turkmenistan's South Yolotan gas field is the
world's second-largest may themselves
underestimate the scale of the field. The auditing
firm had estimated in 2008 that South Yolotan
contained between 4 and 14 trillion cubic meters
(Tcm) with the most likely estimate being 6 Tcm.
(See Turkmenistan
gas sets Ciceronian riddle, Asia Times Online,
October 30, 2009.)
Sources in Turkmenistan
have lately claimed that the actual high-range
figure could be as much as 21 Tcm. This would
represent one-tenth of all known gas reserves
worldwide, exceeded in quantity only by an
offshore field split between Qatar and Iran.
Turkmenistan President Gurbanguly
Berdimuhamedow recently
noted that developing South
Yolotan would require significant foreign
investment, but to date China is the only foreign
country that has received concessions for onshore
fields in the country.
In November 2009,
Turkmenistan and China signed a US$4 billion loan
agreement to develop the field that would be
repaid by gas exports to China. The agreement that
the national firm Turkmengaz signed in December
2009 with China to develop the field also had
development partners from South Korea and Dubai.
The Chinese partners, State Development
Bank and Petrochina, have recently signed another
preferential loan agreement with Turkmengaz,
likely for a similar amount. Operational wells
should be drilled in South Yolotan by the end of
next year and plants will be built to take sulfur
out of the gas before sending it to China's coast
through Uzbekistan, Kazakhstan, and Xinjiang. (See
Gas
pipeline gigantism, Asia Times Online, July
15, 2008.)
Berdimuhamedow disclosed last
month that work on the domestic East-West Pipeline
(EWP) across the country's southern regions is
being accelerated, although he did not give a date
for its expected completion. Work on the project
started in mid-2010 and was originally planned to
conclude in mid-2015.
This is significant
because the EWP is perfectly situated to take gas
from South Yolotan to the country's coast for
entry into an undersea Trans-Caspian Gas Pipeline
(TCGP), making landfall in Azerbaijan for
subsequent transshipment to Europe via the
projected 4,040 kilometer, 31 billion cubic meters
per year (bcm/y) Nabucco pipeline. (See Turkmenistan
signals Nabucco intentions, Asia Times Online,
September 24, 2010.)
According to Wolfgang
Sporrer, regional manager for one of the companies
participating in Nabucco, recent delays in
reaching an agreement with Azerbaijan over Nabucco
are due to the need to synchronize the project's
implementation with the timing of gas production
start-up in "potential supply countries".
Turkmenistan is working with Azerbaijan to create
the conditions for making it possible to implement
a TCGP project. The current TCGP plan involves a
30 bcm/y capacity pipeline.
In Iraq,
Austria's OMV has identified gas from the area
around Kirkuk in the north also as a potential
supply base for Nabucco. (See Iraq
opens door to Nabucco, Asia Times Online,
January 6, 2011.) Nonetheless on Wednesday this
week, at a signing ceremony in Turkey, Project
Support Agreements will be made official between
the responsible ministries of the five transit
countries (Austria, Bulgaria, Hungary, Romania,
and Turkey) and the Nabucco participant companies
(OMV, Bulgaria's old Bulgargaz under a new name,
Germany's RWE, Hungary's MOL, Romania's Transgaz,
and Turkey's Botas).
These agreements will
complete the international-legal framework
necessary for project implementation, on the basis
of the transit regime and other elements outlined
in the Nabucco Intergovernmental Agreement signed
in July 2009. (See Nabucco
ink starts to flow, Asia Times Online, July
16, 2009.) The new documents repeat multilateral
government support for the project at a time when
those doubting its eventual completion have become
more vocal, although there is also a domestic
Turkish angle since the ceremony is taking place
in the constituency of the country's energy
minister just four days before the general
elections in the country.
Berdimuhamedow
has also underlined his country's continuing
interest in the 33 bcm/y
Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas
pipeline project, which will be sourced not from
the South Yolotan deposit but rather from
Douletabad. The country does, however, plan to
build a connector between the two gas deposits
that will enable switching between them.
It was thought that supply and contact
negotiations for TAPI would be completed in the
first half of this year, but price disagreements
with India have prevented that. There is still a
long road beyond that, in as much as the various
consortia have yet to be established. Many foreign
companies have expressed an interest but things
have not gotten much further than the Asian
Development Bank's detailed feasibility studies.
Russia has been discussing with India the
possibility of Gazprom's participation in the
project.
Dr Robert M Cutler
(http://www.robertcutler.org),
educated at the Massachusetts Institute of
Technology and The University of Michigan, has
researched and taught at universities in the
United States, Canada, France, Switzerland, and
Russia. Now senior research fellow in the
Institute of European, Russian and Eurasian
Studies, Carleton University, Canada, he also
consults privately in a variety of fields.
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