EU, Turkmenistan edge closer on gas supply deal: leaders

Ashgabat/Reuters

European Commission President Jose Manuel Barroso, visiting Turkmenistan, said relations with the Central Asian state were "better than ever”, but he failed to extract a commitment similar to that achieved in Azerbaijan on Thursday.

Azerbaijan, across the Caspian from Turkmenistan, has committed to providing Europe with enough gas to enable the creation of a new corridor of pipelines known as the Southern Corridor, which would reduce Europe’s reliance on major supplier Russia.

Addressing reporters after meeting Barroso, Turkmen President Kurbanguly Berdymukhamedov said various options existed for Turkmenistan to deliver gas to Europe, including a pipeline along the sea bed or a fleet of liquefied natural gas (LNG) tankers.

"The technical, commercial and financial issues linked to the realisation of this project must be studied in depth at expert level,” Berdymukhamedov said. "The results of this work will be reinforced in the future by agreements and contracts.”

He has already instructed energy officials in the reclusive former Soviet republic to build closer ties with Europe this year, after recently opening new pipelines to China and Iran.

French energy major Total expects soon to make its proposals on trans-Caspian gas projects.

Neither Barroso nor Berdymukhamedov committed to an exact timescale for signing contracts. The EU Commission president said: "2011 is critical for a decision on the energy issue.”

He added: "Today, the EU and Turkmenistan are closer partners than ever before.”

Turkmenistan plans to more than treble gas output to 230bcm annually by 2030, of which 180bcm will be exported. It traditionally produces around 70bcm a year, although supplies fell after a 2009 dispute with Russia over a ruptured pipeline.

Baymurad Hojamuhamedov, the deputy prime minister with responsibility for the energy sector, said in November that Turkmenistan would have up to 40bcm of gas available to send to Europe, without giving a date.

Berdymukhamedov yester Saturday reiterated an agreement reached in November that any two countries on the Caspian could lay a pipeline across their maritime territory without the agreement of all five states with a coastline on the sea. In theory, Turkmenistan and Azerbaijan could agree to build a pipeline that would supply gas for the Southern Corridor.

The most ambitious of the Southern Corridor projects now is the $10.5bn Nabucco pipeline, designed to carry 31bn cubic metres (bcm) a year of Azeri gas across Turkey into southeast Europe and onward to an Austrian trading hub.