Page 11 - FSUOGM Week 01 2020

FSUOGM POLICY FSUOGM
Turkmenistan schedules investor roadshows
TURKMENISTAN
Turkmenistan’s efforts to develop its offshore oil and gas have floundered.
TURKMENISTAN plans to hold a series of roadshows this year, in a fresh push to lure foreign investors to its Caspian Sea oil and gas resources.
The closed Central Asian state hosts the world’s fourth largest proven gas reserves, esti- mated at 19.5tn cubic metres, according to BP data, as well as some 600mn barrels of oil. But the overwhelming majority of these resources are found onshore. In contrast, its offshore zone is relatively unexplored, despite successive efforts by the government to attract international part- ners to projects.
Turkmenistan’s state-owned oil, gas and geo- logical surveying concerns Turkmengaz, Turk- mennebit and Turkmengeology intend to hold a first roadshow at the Hyatt Regency Hotel in Dubai Creek Heights on February 24 and 25, followed by a similar event in London on July 7 and 8.
According to Turkmen state media, par- ticipants of the roadshows “will discuss issues related to the development of the Turkmen shelf of the Caspian Sea, attracting investment in know-how to optimise oil production.”
Another topic on the table will be theimple- mentation of the next phase of the giant Galk- ynysh gas development in the south-east of the country. Galkynysh has a current production capacity of 30bn cubic metres per year and sup- plies gas to China. But its output is expected to rise to 60 bcm per year under a second devel- opment stage, due for completion in the early 2020s.
State media went on to say the events’ organ- isers “envisage business negotiations with
interested parties on the sidelines of the event.” The Turkmen government has divided its off- shore zone into 32 blocks, which it has offered to investors over the years under production-shar- ing agreements (PSAs). But so far efforts to spur development have floundered, with Turkmen Caspian currently hosting only two active pro- jects – Block 1 operated by Malaysia’s Petronas and Block 2 involving UAE-based Dragon Oil. These projects now account for over half of Turkmen oil production, which came to 222,000 barrels per day (bpd) in 2018 after several years
of decline.
Two other offshore blocks are controlled
by Cyprus-registered Buried Hill and Russia’s Areti, though there is little evidence of any field work taking place at the sites. Over the years other operators have also signed up to explore areas, including Denmark’s Maersk, now part of Total, and German firms Wintershall and Dea, which have since merged. But they with- drew after failing to find resources or through encountering problems with Turkmenistan’s business climate.
Turkmenistan regularly holds events to court oil and gas investors and contractors, including the Turkmenistan Gas Congress, which takes place every May, and the annual Oil & Gas Turk- menistan conference, which is scheduled for this October. It also hosted a Turkmen-Italian busi- ness forum last November.
The latest roadshows will be supported by UK energy consultancy Gaffney, Cline & Associates, which carried out the first independent audit of Turkmenistan’s gas reserves back in 2008 and 2009. ™
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