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turkmenistan  

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TURKMENISTAN


 

 

In-depth Business Intelligence

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 6,010 7,672 4,000 110
         
GNI per capita
 US $ 1,120 1,200 950 131
Ranking is given out of 208 nations - (data from the World Bank)

Books on Turkmenistan

REPUBLICAN REFERENCE

Area (sq.km) 
488,100 

Population 
4,863,169 

Principal 
ethnic groups 
Turkmens 77%
Uzbeks 9.2%
Russians 6.7%

Capital 
Ashkhabad 

Currency 
Turkman Manat

President 
Saparmurat Niyazov


Update No: 303 - (27/03/06)

The dictatorship of the Didactic
The Turkmen Republic has one of the strangest rulers on the planet, in many ways the weirdest, Saparmurat Niyazov.
He is apparently totally convinced that he is a religious genius of the highest order - comparable to Buddha, Jesus and Mohammed. His religious wisdom has been distilled into a 406-page work which is required reading for all Kyrgyz schoolchildren and for such adults as want to get ahead. Kyrgyzstan is reckoned to be one of the eight most repressive regimes in the world. Science studies are being neglected in the schools for examination and exegesis of this imperishable masterpiece. Truly, brainwashing is alive and well in Turkmenistan, as in North Korea. 

Gems of wisdom 
The Rukhmana is available on the internet at the following website, Rukhmana. com ( the 'k' is optional). He maintains that it holds three keys to paradise. "Anyone who reads (it aloud) three times will become more intelligent, recognize the divine being and go straight to heaven."
"The Bible, the Koran and the most holy Rukhmana," says the title page. My dear Turkmens! Respect your elders…..Love your juniors. Do not be mean with emeralds for your daughters and wives."
"My philosophy is unity and togetherness. No other nation was divided into so many tribes as the Turkmens." This fact is the justification of many a despotism in the world. But of course it has its moment of truth.
The problem is the extravagance of the claims Niyazov makes. Gaddafi's Green Book, even Mao's Little Red Book, are modest by comparison. In previous pronouncements, summed up in the holy work, Niyazov had banned ballet and opera, castigated gold teeth and named a range of items after himself, including a city, an airport and a month (previously January). His book is also much honoured, lending its name to a university and the month of September.
His mother has given her name to the month of April; she lost her life in saving his own in an earthquake in 1948. There must be many a Turkmen who wishes that she had failed.

The Turkmenbashi engineers a new gas crisis for Ukraine and Europe?
Turkmenistan may be a remote country, run by a megalomaniac; but it is impacting on areas of the world much in the news at the present time, namely Europe and Iran. This is by reason of the fact that it is the fourth largest exporter of natural gas on the planet, with the third or fourth largest reserves.
On February 2nd, Turkmen President Saparmurat Niyazov -- who goes by the self-awarded title "Turkmenbashi," or "Father of the Turkmen" - announced plans to cut pensions to the elderly and disabled, thus encouraging the tradition of offspring caring for their aging parents. On February 13th, eleven days later, Niyazov declared that by autumn he would raise natural gas prices in his country to more closely reflect those of the world market. Niyazov has apparently unquestioned authority in his country, and his move is likely to affect not only Russia and Ukraine, but gas customers in Europe as well.
It is clear from these two statements that Turkmenistan's economy is in some trouble. Raising natural gas prices to market levels is one obvious remedy. 
The prices Niyazov is proposing are certain to anger Ukraine, which was forced to accept new terms for its energy purchases following the Jan. 1st-3rd gas crisis caused by Russia. After Gazprom cut off supplies to Ukraine, RosUkrEnergo (which is controlled in equal parts by Gazprom and the Austrian holding firm Raiffeisen), (whoever in the end, they and their shareholders turn out to be) struck a deal with Ukraine's Naftogaz -- forming a new company called UkrgazEnergo, which will sell a mixture of Russian and Central Asian gas to Ukraine. 
Turkmenistan currently contributes supplies to this venture at US$65 per thousand cubic meters. Under terms of a certain clause, RosUkrEnergo can initiate pricing changes if the cost of its own supplies shifts, and Kiev would not be able to reject the increase. 
Niyazov has proposed hiking Turkmenistan's prices to US$100 per thousand cubic meters. Ultimately, that could cause Ukraine to siphon off more natural gas supplies that are intended for customers in Europe -- and bring down the continent's already considerable dissatisfaction upon Kiev. It's still quite cold, and the Europeans at this point are feeling rather defensive about their energy supplies.
Of course, any business deal that relies on supplies from Turkmenistan, as though Niyazov was a reliable and consistent partner entails trouble from the beginning. The Turkmenbashi previously has cut off gas supplies to his country's largest customer, Russia, with no signs of hesitation or guilt, and could be expected to do so again if it serves his purposes.
Gazprom chief Alexei Miller visited Ashgabat on Feb 18th, at President Vladimir Putin's request, to "negotiate" the possibility of a price increase in Turkmenistan. But even though Russia is the country's chief trade partner and protector, Niyazov may not necessarily acquiesce to Moscow's wishes.
Ukraine, of course, has been through this before. A third gas cutoff would further damage its reputation in the Europe it so longs to join. But in this case as the others, there's little Kiev can do to balance out the situation. 
Europe, on the other hand, has sought to diversify its energy supplies, and Niyazov's latest pronouncement should push it further toward that goal. At least for Germany, the North European Gas Pipeline (NEGP), although several years off completion, becomes a more viable alternative to the supplies currently being sent via third parties. For others, reliance on nuclear power and other sources will continue to be important. 
In either case, it is likely that so long as their energy supplies remain at least partially subject to the mystery that is the Turkmenbashi, the Europeans will be ever more anxious to move away from natural gas shipments originating in the East.
Still, in the interim they have no other choice but to deal with the Turkmens.

PM Yekhanurov expects to sign the intergovernmental gas agreement with Turkmenistan
Turkmenistan is the largest gas exporter to Ukraine. In 2004, Ukraine bought 36 milliard c. m. of Turkmen gas which made up 45% of its needs. It is of vital importance to Kiev to come to an understanding with the eccentric dictator of Ashkabad, even to extending him the red carpet treatment any time soon.
PM Yuri Yekhanurov stated Ukraine does not yet have an intergovernmental agreement on gas supply with Turkmenistan. "There is no intergovernmental agreement with Turkmenistan, but it is necessary to have one in 2006," said the Ukraine PM. 
As a reminder, in December 2005 Ukraine and Turkmenistan signed the provisional contract-2006 on 40 milliard c. m. of gas at US$44 per 1,000 c. m. At the end of December 2005, PM Yekhanurov stated Ukraine would expect to sign an agreement with Turkmenistan on gas supply until 2031. 
"I have charged corresponding officials with preparation of documents for the visit of Turkmen President Saparmurat Niyazov. I think we will manage to prepare the long-term agreement," said PM Yekhanurov. 

Iran interested in purchasing more gas from Turkmenistan
Iran is in the spotlight of the world's media right now for pressing ahead with a nuclear power programme. This seems to have a military logic, given that it possesses huge oil reserves, the second or third largest in the world, while it neighbours Turkmenistan that can provide it with an abundance of natural gas at cheap rates, not to speak of potential hydro-electricity from Tajikistan.
During a telephone conversation on February 12th with President Niyazov, the foreign minister of Iran informed him that his country was interested in purchasing more natural gas from Turkmenistan.
Manouchehr Mottaki, foreign minister of Iran, told Niyazov that a high powered delegation would soon visit Ashgabat to finalize the volumes and price of the natural gas that Iran wants to buy in 2006.
At present Iran is purchasing 8 billion cubic meters of Turkmen gas annually.
He confirmed that Iran had agreed to pay a higher price for Turkmen gas and the necessary document would be signed in the near future when an Iranian delegation visits Turkmenistan.
Mottaki told him that his country was keen to expand broader cooperation, especially in the energy sector, with Turkmenistan. He said that Iran would like to substantially increase the volumes of gas it buys from Turkmenistan. The sides are expected to sign an agreement of partnership in this sphere during the proposed meeting of the heads of state in the spring.

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ENERGY

Foreign firms to boost oil production in Turkmenistan 


Foreign oil companies working under production sharing agreements in Turkmenistan plan to increase production 30 per cent to three million tonnes in 2006. A source in the republic's Oil, Gas and Natural Resource ministry said that this forecast is based on results in 2005, Interfax News Agency reported.
Last year oil production by foreign companies in Turkmenistan increased 30 per cent from 2004 to over 2.3 million tonnes. In particular, British-Arabian Dragon Oil, which is working at the Cheleken field, produced over 940,000 tonnes of oil in 2005 and Britain's Burren Energy, which is working at the Nebitdag field produced about 950,000 tonnes. In 2006 Dragon Oil plans to bring eight new wells on-stream. Investment by the company at the contract zone this year is estimated at 280 million Euro. By 2010 the company plans to increase annual production to 23.5 million tonnes. Burren Energy is currently only producing at one of the five fields at the Nebitdag block. The company has drilled 10 new wells to date. Malaysia's Petronas and Denmark's Maersk Oil are working in the Turkmen sector of the Caspian Sea under production sharing agreements. Petronas plans to start producing early oil in 2006. Maersk Oil completed a seismic research programme in 2005 at the contract zone and is preparing to drill a first well at the joint blocks 11 and 12 in the Mid-Caspian oil and gas basin. According to the ministry, a total of over 1.2 billion Euro was invested in implementing oil PSA in Turkmenistan since 1996.

Ashgabat, Tehran continue talks on gas supply 

Turkmen President, Saparmurat Niyazov, on February 3rd received an Iranian delegation headed by Foreign Minister, Manuchehr Mottaki. The representatives of the neighbouring country arrived in Ashgabat on the instructions of Iran's President, Mahmud Ahmadinezhad, as agreed during a telephone conversation between the two presidents. Iran's ambassador to Turkmenistan, Gholamreza Ansari, also attended the meeting.
According to the state news agency TDH, the meeting's participants expressed confidence in finding mutually acceptable solutions, which would also serve as a key factor in the further strengthening of the traditionally friendly and neighbourly relations between the two countries. During the talks, both sides agreed to continue discussing the terms for Turkmen gas supplies to Iran. The central topic of discussion was the volume and cost of supplies, the Turkmen presidential press service told Interfax News Agency.
The Iranian delegation asked for time to carefully study the terms put forward by Turkmenistan and assured they would be ready to provide their corresponding proposals by February 11th. 
Based on the situation on international energy markets, Turkmenistan at the end of 2005 decided to raise its prices on natural gas exports. It notified all its buyers - Russia, Ukraine and Iran, of the decision in advance. A compromise was found with Russia and Ukraine. Russia will buy 30 billion cubic metres of Turkmen gas at 65 Euro per thousand cubic metres in 2006 and Ukraine will buy 40 billion cubic metres (experts put the price for Ukraine at 50 Euro per 1,000 cubic metres). An agreement with Iran, to which Turkmenistan expects to export about eight billion cubic metres of gas in 2006, has not yet been reached.

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TRANSPORT

Turkmenistan completes Trans-Karakum railway 

Turkmenistan has built a 540 kilometres-long railway connecting Ashgabat and Dashoguz (Trans-Karakum Railway), reducing the trip from the Turmken capital to the administrative centre of Dashoguz region by 700 kilometres. The northern and southern stretches of the railway were linked up at the 440th kilometres on February 8th. It took Turkmen constructors more than five years to build a steel track through the Karakum desert, Interfax News Agency reported.
Turkmen President, Saparmurat Niyazov, congratulated railroad constructors on laying down the road's "golden link." In his address, Niyazov expressed confidence that the Ashgabat-Karakum-Dashoguz railway will open new opportunities for further development of this province and become an important transit corridor from Europe, Asia and Far East to Persian Gulf. Turkmenistan's Railways ministry told Interfax that the North-South transport corridor would be officially inaugurated and put into service in March. The railway has three bridges, various infrastructure, eight stations and nine railway junctions. It is expected that a passenger train from Dashoguz would arrive in Ashgabat in 12 hours. From now on, the railway route between these regions will be 700 kilometres shorter. Over 1,500 workers of Turkmenistan's ministry of railway transportation subsidiaries were engaged in construction of the Ashgabat-Karakum-Dashoguz railway. Of them, 800 people worked in the desert. Stowage of sleepers and rails was carried out by three road machine stations. Workers of two construction trains laid down the groundwork and erected buildings and engineering structures. The new trunk will be serviced by 500 rail workers. 

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