TURKMENISTAN – CHINA GAS AGREEMENTS: STILL A VERY LONG SHOT

On July 17 in Beijing, the Turkmen and Chinese governments signed grandiose-looking agreements on gas field development in Turkmenistan and gas sales to China. Presidents Hu Jintao and Gurbanguly Berdimukhamedov — on his first visit to China since becoming president in February — witnessed the signing.

China

These estimates are not independently confirmed and do not include unexplored or unprospected fields in that basin. Thus, the reserves may turn out to be significantly lower or significantly higher than the current reference figure. CNPC already holds a contract — valued at $1.5 billion according to the corporation — for gas field exploration in Turkmenistan. It envisages digging 12 exploration wells during 2007-2010 at the fields of South Yolotan (in southeastern Turkmenistan).

Also on July 17, CNPC and the state firm Turkmengas signed a sale-and-purchase agreement that envisages deliveries of 30 billion cubic meters of Turkmen gas to China annually for 30 years. There is no public word on the starting date of the delivery period, pricing arrangements, or pipeline construction and third-country transit. The pipeline would run to China