Gazprom and Turkmenistan Agree on Long-Term Natural Gas Supplies

Strategic Insights -

Deputy Chairman of Russia's Gazprom, Alexander Ryazanov, met with Turkmen Minister of Oil and Gas Industry and Mineral Resources, Kurbanmurad Atayev, in Ashgabat on April 17 and 18. The two sides discussed the annual delivery of 50 billion cubic meters of Turkmen natural gas to Russia over the next three years. Gazprom has announced its intention to increase the annual import of Turkmen gas to 50 billion cubic meters, with a focus on finalizing the terms and conditions of gas supplies.

Key Takeaways:

  • Gazprom plans to increase the annual import of Turkmen gas to 50 billion cubic meters over the next three years.
  • Turkmenistan and Russia signed a contract on Turkmen natural gas supplies to Russia for 25 years in 2003, with Gazprom agreeing to buy 10 billion cubic meters of Turkmen gas in 2006.
  • The production cost of Turkmen gas is $2.50 per 1, 000 cubic meters, while the cost of gas extraction at Gazprom's fields in Western Siberia is six times higher.
  • Gazprom imported 5 billion cubic meters of Turkmen gas in 2005 and 11.4 billion cubic meters in the first quarter of this year.
  • Turkmen gas is transported to Russia and Ukraine through the Gazprom-controlled gas pipeline system Central Asia-Center.
  • Ukraine signed a contract on the delivery of 40 billion cubic meters of Turkmen gas in 2006 but has not received any gas due to insufficient pipeline capacity.

Statistics:

  • Gazprom plans to import 50 billion cubic meters of Turkmen gas per year over the next three years.
  • The production cost of Turkmen gas is $2.50 per 1, 000 cubic meters.
  • Gazprom imported 5 billion cubic meters of Turkmen gas in 2005 and 11.4 billion cubic meters in the first quarter of this year.
  • The cost of gas extraction at Gazprom's fields in Western Siberia is six times higher than the production cost of Turkmen gas.

Sources:

  • Asia Pulse - "Gazprom and Turkmenistan Agree on Long-Term Natural Gas Supplies"
  • TCA (Turkmenistan News Agency) - No date provided in the original text.