Turkmenistan in talks for 'tens of billions of dollars" of investment in its gas fields

Turkmenistan is in talks with buyers of its natural gas led by China to invest "tens of billions of dollars" in its natural gas fields including the giant Galkynysh deposit, Turkmengas Deputy Chairman Myrat Archayev said Oct. 27 at a press conference in Ashgabat.

China wants an additional 25 Bcm of gas in the second phase expansion of Galkynysh, while Afghanistan, Pakistan and India are earmarked to get 33 Bcm/year through the third phase expansion of Galkynysh, Archayev said at the conclusion of the Oil & Gas Turkmenistan conference and exhibition. Uzbekistan has also contracted for 2 Bcm/year of gas, Archayev said.

"We're expecting continued negotiations and interest of our European and Turkey partners to implement the Trans Caspian pipeline," he said.

The pipeline is envisioned to deliver gas into Turkey and the rest of Europe. Turkmenistan's president Serdar Berdimuhamedov met with Turkey's president Recep Erdogan on Oct. 26 in Turkey, he said.

"Supplies of Turkmen natural gas to Turkey and to world markets through Turkey have acquired special strategic importance," Erdogan said at a press conference in Ankara on Oct. 27, according to the Turkmenistan conference organizers, citing news agency Orient.tm. "In this context, both bilateral cooperation with Turkmenistan and trilateral cooperation processes involving Azerbaijan are important."

Turkmenistan currently has an East-West gas pipeline with a length of 800 km connecting most of its gas fields that could be used to export gas to nearby countries including Azerbaijan and Uzbekistan, he said.

"There is a lot of work to be done," Archayev added.

Galkynysh's resource base is believed to be capable of producing 200 Bcm/year through seven expansion phases, starting with the first phase now in operation, according to a June report by S&P Global Commodity Insights. In 2019, Russia contracted for 5 Bcm/year of gas from Turkmenistan, Archayev said, declining to comment on future contracts.

Turkmenistan's gas production last year is estimated at 74.4 Bcm, down about 6% on the year after Russia's Gazprom reduced its imports of Turkmen gas by about 67% to 3.4 Bcm last year, according to a S&P Global Commodity Insights report in June. Exports to China were the dominant destination last year at 36.6 Bcm, up about 3% from 2021, or about 84% of its total exports, it said.