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Turkmenistan: Gas-Export Offer Seen As 'Breakthrough' By EU

Part of Turkmenistan's Korpeje oil and gas field (ITAR-TASS) BRUSSELS -- The European Union says Turkmenistan has made its first-ever serious gas-export offer to Europe.

"[The EU was told that] as of 2009, 10 billion cubic meters of gas will be available for transport towards Europe," European Commission spokeswoman Christiane Hohmann told RFE/RL in Brussels on April 15. Hohmann accompanied a high-level EU delegation to Ashgabat last week.

Hohmann said the precise nature of the offer is seen as a "breakthrough" by Brussels. So far, she said, Ashgabat had only offered the EU vague "assurances" of its export capacity, which, EU officials feared, were based on unrealistic estimates. Turkmenistan is already under contract to supply significant volumes of gas to Russia, China, and Iran.

To be sure, the "assurances" are still there, but as a prospective icing on the cake. Hohmann said Turkmen President Gurbanguly Berdymukhammedov promised to augment his exports to Europe further as currently undeveloped gas fields come on-stream.

Three Options

But perhaps more significantly, Berdymukhammedov stated in clear terms for the first time that he wants to supply gas to Europe directly without transiting it via Russia. Although Hohmann said alternative transit routes were not specifically raised at the talks in Ashgabat, she said the Turkmen side left no doubt it is looking to bypass Russia.

"There are three options on the table," she said, "which [are]: the trans-Caspian pipeline linking Turkmenistan with Azerbaijan; there is another option of going through Kazakhstan to Azerbaijan; or to transport it on ships [in the form of] liquefied gas."

The Turkmen bid is a boost for EU-backed but currently stalled efforts to build the Nabucco gas pipeline, which would link the EU's main southern gas hub in Austria to Azerbaijan. Russia has been trying to undercut the economic viability of Nabucco by announcing separate plans to build a competing pipeline -- known as South Stream -- through the Black Sea to Bulgaria.

The point for Russia is to deny the EU independent access to Central Asian gas. Russia wants to preserve its lucrative transit monopoly, retain its political grip over the Central Asian countries, and it also needs Central Asian gas to be able to honor its own export commitments to the EU, currently running at some 150 billion cubic meters a year. Some observers say a lack of investment by Moscow and rising domestic consumption could lead to export shortfalls as early as 2010.

Russian Leverage

Meanwhile, Russian imports account for more than one-quarter of the EU's total gas consumption, giving Moscow considerable leverage in its dealings with the bloc.

Nabucco is projected to have a capacity of upwards of 30 billion cubic meters by 2020. Currently, the project can only reckon with Azerbaijan's gas, as Iran remains beyond the political pale for the EU. In November 2007, Azerbaijani President Ilham Aliyev told EU officials his country could double its current export annual volume of 9 billion cubic meters.

This would still leave a shortfall of some 10 billion cubic meters, which is more or less exactly what Turkmenistan has now offered.

The problem that remains for the EU is to find investors for both the Nabucco and trans-Caspian pipelines. Brussels says it will not underwrite the investments, insisting the projects must be commercially viable.

Many observers have warned that the EU's aversion to "political" investments leaves its strategic interests vulnerable to meddling by Russia, which still controls the gas monopoly Gazprom.

RFE/RL has been declared an "undesirable organization" by the Russian government.

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