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Turkmenistan awards giant gas field contract

Turkmenistan awards giant gas field contract

Energy-rich Turkmenistan has awarded a $9.7 billion contract to a consortium of companies from China, South Korea and the United Arab Emirates to develop one of the world's largest natural gas fields, a state newspaper reported Wednesday.
The vast field near the Central Asian nation's eastern border with Afghanistan has been subject of vigorous international lobbying by companies from China, the West and Russia, who are all vying for a share in Turkmenistan's vast energy riches.
According to British auditors Gaffney, Cline and Associates, the South Yolotan field is likely to hold around 7.85 trillion cubic yards (6 trillion cubic meters) of gas, making it possibly the fourth- or fifth-largest field in the world.
The companies awarded the contract to develop the field and build gas refining plants include China's CNPC, LG International Corp. and Hyundai Engineering from South Korea, and London-listed companies Gulf Oil & Gas FZE and Petrofac International from the UAE.
The deal was formalized Tuesday in a signing ceremony in Ashgabat, the Turkmen capital, presided over by President Gurbanguli Berdymukhamedov, state-run newspaper Neutral Turkmenistan reported.
"These contracts effectively signal the start to a giant project of regional and global importance," the newspaper said.
Turkmenistan long has been the focus of intense rivalry between the West and Russia for access to its vast natural gas reserves, which the government estimates may total more than 700 trillion cubic feet (20 trillion cubic meters).
Russia had a lock on most of the reclusive desert nation's gas exports until earlier this month, when a China-bound major gas export pipeline went into operation. Turkmen gas deliveries to China through the pipeline are expected to hit around 6 billion cubic meters next year and increase incrementally until reaching 40 billion cubic meters in 2015.
China's 30-year gas deal with Turkmenistan was accompanied by a commitment from China to lend Turkmenistan's state gas company $4 billion on preferential terms. From that sum, around $3 billion has been earmarked for the development of the Yolotan field.
In the short-term, Russia will remain the main buyer of Turkmen gas. Last week, Turkmenistan agreed to resume natural gas supplies to Russia, resolving a monthslong dispute and giving Moscow renewed access to supplies from the Central Asian nation.
Starting from Jan. 10, Russia will buy 30 billion cubic meters of gas annually from Turkmenistan. But this is significantly less than the 50 billion cubic meters that it was buying from Turkmenistan before a pipeline explosion cut supplies in April.


Updated : 2021-04-21 00:04 GMT+08:00