Annexed by Russia between 1865 and 1885, Turkmenistan became a Soviet
republic in 1925. It achieved its independence upon the dissolution of the
USSR in 1991. President NIYAZOV retains absolute control over the country
and opposition is not tolerated. Extensive hydrocarbon/natural gas
reserves could prove a boon to this underdeveloped country if extraction
and delivery projects can be worked out.
Update No: 278 - (01/03/04)
The vice of Russia
The Turkmen leader, Saparmurat Niyazov, is trying to develop a new string to his meagre bow. Basically the Turkmen republic's fate is closely tied to Moscow. Its vital gas exports go via Russia to the wider world. They do so down truly colonial pipelines.
This has given such leverage to Moscow that the Turkmen get only a tithe of world prices for their gas, namely $22 per 1,000 cu m, plus another $22 in the form of Russian goods. And this is all in a deal signed last year, that is for 25 years no less.
Niyazov's new idea is to court the Ukrainians. He has invited President Leonid Kuchma of Ukraine to Ashkabad to discuss an even longer deal, to last until 2032. Turkmenistan would become a provider of gas to Ukraine second only to Russia. The visit has been delayed from February to April to give the respective countries' energy experts more time to work out the details.
Repression remains the norm
Niyazov likes doing long-range deals with fellow former Soviet apparatchiks. It is as if the Soviet system were still in existence, when he was in his element as president and head of the Turkmen Communist Party. Kuchma is also a rogue like him, who has opposition journalists killed.
The atmosphere in Turkmenistan is still one of fear after an unsuccessful attempt to assassinate Niyazov was made on November 25th 2002. It will be more difficult to attempt it again. He has the sense not to travel publicly abroad, not even to the summits of fellow dictators in Central Asia.
He has lost an ambassador or two who have sought asylum abroad, as with the envoy to Turkey a year or two ago. But it is unlikely that, short of another successful attempt on his life, he will lose power soon. He has, indeed, been declared president for life by the tame parliament.
Turkmenneft joins joint venture Zarit
Oil company Turkmenneft has become a player in the joint venture Zarit, set up in 2002 by
Zarubezhneft, Rosneft and Itera, a source with one of the participants said, Interfax News Agency reported.
The Turkmen company has received a 15% stake in Zarit in a distribution of other participants' shares. Rosneft and Itera each now have approximately 31% instead of 37%, Zarubezhneft around 23% instead of 26%. Zarit was set up to work blocks 28, 29, 30 and 31 on Turkmenistan's section of the Caspian Sea shelf. Turkmenistan has invited Iran to become a partner, too, though Iran has not yet indicated its acceptance. The source noted that the country's involvement would be desirable for the project's implementation. Zarit may well be signing a production sharing agreement with Turkmenistan on a project for developing Caspian Sea shelf deposits in the near future.
Deputy Foreign Minister, Viktor Kalyuzhny, Russia's presidential envoy on the legal status of the Caspian Sea, announced that "there could be a contract signing with the Russian-Turkmen company
Zarit, consisting of Zarubezhneft, Rosneft, Itera and, naturally, Turkmenistan."
In early November 2003, the company's first board of directors meeting voted to bring Turkmenistan and Iran on board to speed up the project's implementation. The possibility of giving them each 10% to 15% of Zarit is being discussed.
However, Iranian Ambassador to Russia, Gholamreza Shafee, has said that the possibility of Iran's involvement in Zarit might only be looked at after the Caspian's legal status is settled. Before it is, "We cannot take part in the project," which is located in a disputed area, he said. "The dispute has to be settled first, then a decision can be made."
Turkmenistan and Ukraine to sign 25-year gas deal
Turkmenistan and Ukraine plan to sign a 25-year agreement for gas supplies in 2007-2032, decided during a recent official visit to Turkmenistan by Ukrainian President, Leonid
Kuchma, a source in the Turkmen presidential press service said, Interfax News Agency reported.
These plans were confirmed during a meeting between Turkmen President, Saparmurad
Niyazov, and Ukrainian Ambassador to Turkmenistan, Vadium Chuprun. The press service quoted the Ukrainian diplomat as saying that the Ukrainian government is ready "to develop a long-term partnership with Turkmenistan further, based on principles of equality and mutual gain." Turkmenistan is a major supplier of gas to Ukraine and accounted for 45% of the Ukrainian gas market in 2003. In turn, Ukraine is a large buyer of Turkmen gas. At the moment, under a 5-year contract for 2002-2006, Ukraine annually receives 34-36bn cu m of gas from Turkmenistan at US$44 per 1,000 cu m. Ukraine pays for 50% of this gas in cash and 50% in goods and services.
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