Page 4 - FSUOGM Week 45 2019

FSUOGM COMMENTARY FSUOGM
Turkmenistan’s pipe dreams
Turkmenistan is still nowhere near realising its ambition to establish new routes to Asian and European gas markets
TURKMENISTAN
WHAT:
Turkmenistan presented its TAPI pipeline project in Italy this month.
WHY:
Ashgabat wants investors, but there are no signs that the project is anywhere near financial close.
WHAT NEXT:
Political and commercial realities make it unlikely that either TAPI or Turkmenistan’s Trans- Caspian pipeline project will ever get off the ground.
TURKMEN President Gurbanguly Berdy- mukhamedov was in Milan this month for a Turkmen-Italian business forum, leading a delegation of oil, gas, agriculture and chemical industry representatives.
Ahead of the 48-hour visit beginning on November 6, state media back in Ashgabat promised that a “large package of documents” would be signed between Italian and Turkmen companies. It was later reported that 22 invest- ment projects in Turkmenistan had been agreed worth a combined $13mn – but details were scarce.
As with many of his overseas outings, Berdy- mukhamedov used the Milan trip to showcase Turkmenistan’s two transnational pipeline pro- jects to Asia and Europe, neither of which has seen much tangible progress since they were first conceived in the 1990s.
Turkmenistan has the world’s fourth largest proven gas reserves, estimated by BP at 19.5tn cubic metres. But it has been unable to exploit this wealth to the full because of limited access to markets, with its only customers being China and to a lesser extent Russia and Iran. The Turk- menistan-Afghanistan-Pakistan-India (TAPI) pipeline and the Trans-Caspian Pipeline (TCP) projects are expected to change all this, at least
according to the Turkmen regime, carving out new routes to markets in Asia and Europe.
TAPI
Those who attended the forum in the hope of hearing the latest updates on TAPI would have come away disappointed, as the head of its oper- ating company, Muhammetmyrat Amanov, gave only a broad outline of the project’s parameters in a presentation.
Back in February last year Amanov claimed that the 214-km Turkmen section of the 1,800- km pipeline had been completed. But evidence suggests otherwise.
Since a formal ground-breaking ceremony was held in December 2015, Turkmen authori- ties have not issued any updates on construction progress. In November last year, Saudi Arabia’s Global Pipe Co. said it had won a contract to sup- ply 35km of pipe for the project, though there is no confirmation this order was carried out. And in April this year, Russian state lender Sberbank said it had approved a letter of credit (l/c) for a $219mn contract won by a Russian pipe manu- facturer to supply 214km of pipe for TAPI’s con- struction in Turkmenistan – exactly the length of the entire Turkmen section. This would suggest that, if any pipelaying has taken place, it did not
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w w w . N E W S B A S E . c o m Week 45 13•November•2019