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invest in infrastructure to connect its fields of Ukraine’s gas industry lies in the President Serdar Berdimuhamedov’s state
with the Power of Siberia. East, with Kharkiv at its centre. As such, visit to China at the end of last week.
Reportedly, Rosneft argues that it has Russia’s invasion and occupation of Xi stated his desire for increased
over 1.5 trillion cubic metres of gas in Kharkiv significantly hurt Ukraine’s gas cooperation in the energy sector with
reserves along the route of the future second production with Ukrgazvydobuvannya, the Turkmenistan.
line of the pipeline, and the influential head country’s largest gas production company, "Natural gas cooperation is the
of the company Igor “Oil Czar” Sechin has producing 13.2bn cubic metres, a drop of cornerstone of the China-Turkmenistan
appealed to his long-time ally President 3% compared to 2021, after freezing several relationship," Xi was reported as saying by
Vladimir Putin to account for these reserves facilities in Kharkiv in March. Reuters.
in the design of the pipeline. In addition to the invasion, low The two heads of state also announced
Reportedly, in December 2022 Putin investment in gas production also the elevation of the China-Turkmenistan
instructed the Deputy Prime Minister and contributed to the decline. Ukrnafta saw a relationship to a comprehensive strategic
ex-Energy Minister Alexander Novak to drop of 7% to 1 bcm, a result of ageing fields partnership.
work out the issue jointly with Gazprom. and low investment. The company has since Turkmenistan is the largest supplier of
The Power of Siberia-2 pipeline from been seized by the Ukrainian government piped natural gas to China and China is the
Russia to China with an annual capacity of under martial law, following an emergency only major buyer of Turkmen gas.
up to 50bn cubic metres is planned to pass decision by the Ministry of Defence which For the first 11 months of 2022, China's
through Mongolia. The resource base for affected some of Ukraine’s most notorious imports of Turkmen gas were valued at
the project could be Gazprom's gas fields in oligarchs. Ihor Kolomoskiy’s companies $9.3bn, up from $6.79bn in the whole of
the Yamal Peninsula, Kovyktinskoye field in own 42% of Ukrnafta. 2021, according to Chinese customs data.
the Irkutsk Region and the resources of the The biggest decrease was noted in private
Krasnoyarsk Territory. gas producers following the ban on the In 2022, the China-Central Asia gas
Since 2019 Gazprom has supplied gas to export of domestically produced gas over pipeline transported 43.2bn cubic metres of
China via the Power of Siberia-1 pipeline, the summer. As such, they produced only natural gas to China, with a daily transport
whose resource base is the Kovyktinskoye 4.3 bcm, a 15% drop, and many private amount of about 100mn cubic metres,
and Chayandinskoye fields, with the full companies have drastically reduced their according to the Horgos initial compressor
capacity of 38 bcm anticipated to be reached investment in gas production. station of PipeChina West Pipeline
by 2025. Nevertheless, with Ukraine regaining Company, ECNS.cn reported on January 5.
Sources reminded Kommersant that control of much of its Eastern regions, Around 80% of gas flows to China via the
Rosneft is the country's third-largest gas gas production is resuming operations as pipeline are transited from Turkmenistan.
producer after Gazprom and Novatek, and quickly as possible. Ukrgazvydobuvannya Gas flows from Turkmenistan to China
the largest producer of associated petroleum managed to launch a well in the Kharkiv transit through the Central Asia-China Gas
gas. Sechin reportedly argues that gas fields Region with a production rate of more Pipeline’s A, B and C strands. Plans to build
without access to the pipeline infrastructure than 140,000 cubic metres of gas per day in and launch a D strand are proceeding.
cannot be monetised. October and drilled a record volume of new It is the progress on delivering D strand
"The Power of Siberia-2 is the only real wells in September. that was perhaps the most important
pipeline route for the export monetisation “Drilling of new wells has the most discussion point on the agenda for
of Gazprom's gas in YNAO [Yamalo- significant and sustainable impact in terms Berdimuhamedov and Xi. The former has
Nenets Autonomous Oblast],” Mikhail of providing the country with its own referred to plans to approximately double
Grigoriev of the Gekon consulting centre Ukrainian gas,” CEO Oleksandr Romaniuk annual gas exports to China. However,
told Kommersant. Grigoriev believes that said. it is believed Turkmenistan sells its gas
given the limited capacity of the planned Currently, Ukrgasvydobuvannya is at a lower price to China than do other
Power of Siberia pipeline, Gazprom is likely interested in starting the application of suppliers, thus Berdimuhamedov likely
to continue to resist any third-party inputs horizontal drilling technology, which can pushed for a renegotiation of the price.
to the exports route.tonnes/day, but it will contribute to a rapid increase in gas output
now increase that volume to 2,800 tonnes at both new fields and those that have been
(+27.3%). in operation for a long time.

Ukraine suffers biggest gas Xi keeps door open to receiving
production loss in 20 years more Turkmen gas during

Ukraine suffered its lowest production of Berdimuhamedov’s state visit to
gas in 20 years, with volumes falling by 6%
last year, Ukraine Business News reported China
on January 9.
In total, Ukraine produced 18.5bn Chinese President Xi Jinping kept the door
cubic metres of gas, with Russia’s invasion open to Beijing possibly receiving more
being the main cause for decline. Much gas from Turkmenistan during Turkmen

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