2 June 2023 - 15:52
  • News ID: 473662
IIES chief: Iran most reliable market for Turkmen gas

SHANA (Tehran) – Iran is the most reliable market for Turkmenistan’s gas, said the head of Iran’s Institute for International Energy Studies (IIES) on Thursday.

Talking to SHANA, Mohammad Sadeq Jokar added Turkmenistan needs the Iranian market, as its gas export options have been limited.

Given the regional and international developments, Turkmenistan has realized that Iran is the most reliable market, reiterated the IIES chief.

Elaborating on the developments, he said, “Turkmenistan considers Russia as its traditional market, signing a contract with Gazprom in 2019 on [exporting] 5.5 billion cubic meters (bcm) by 2024. But, this market will not apparently be revived in the near or predictable future, as Russians have lost their European markets and faced a gas surplus and consequently Gazprom will not import Turkmenistan’s gas.

“On the other hand, China was the next country after Iran, which imported gas from Turkmenistan. Ashgabat signed a contract to export 40 bcm of gas to China through its Central Asian pipelines. However, China’s plan for importing liquefied natural gas (LNG), exploring Shale gas, and implementing domestic development plans could result in reducing its gas imports from Turkmenistan and Asian countries.

“Considering the developments in Afghanistan, the short-term outlook for Turkmenistan’s southern market is not good either. Security in Afghanistan and investment and pipe-laying operations in a country without necessary infrastructure are among challenges facing the market.”

Jokar added the Caspian Sea legal regime is the main challenge Turkmenistan is faced with for finding its way into the European markets, as it is an obstacle to the implementation of the Trans-Caspian Gas Pipeline project.

In addition, he continued, “Due to gas prices, gloomy outlook for Europe’s gas sector following the Ukraine crisis, transit costs, and Europe’s focus on LNG, Europeans do not have the prime motive for constructing this long pipeline. Meanwhile, it is not economically appealing to Turkmenistan due to gas prices.”

Ukraine crisis impact

The Ukraine crisis has had an indirect impact on Turkmenistan, prompting it to have a stronger tendency to promote its cooperation with Iran, as Russia has moved toward China after its losses on the European gas markets, meeting a part of China’s demand satisfied earlier by Turkmenistan, the IIES head explained.

Russian was to export the Turkmen gas to Europe through Nord Stream 2 pipeline, mentioned Jokar, adding the plan was canceled due to the Ukraine conflict and the pipeline bombings.

Gas swap was the first plan put forward and later Turkmenistan expressed its willingness to export gas to Iran, he recalled.

Debt to Turkmenistan

Iran’s gas debt to Turkmenistan was the main obstacle to expansion of their cooperation, said the IIES chief, continuing, “The 13th (incumbent) removed the obstacle by paying the debt [Iran owed for importing gas during the previous governments] and Iran has turned to the main transit market for Azerbaijan.”

On the other hand, gas imports from Turkmenistan will help Iran redress imbalance between production and consumption in the northeastern part of the country, he concluded.

News ID 473662


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