Friday, October 5, 2007

Is Turkmenistan Neutral?

Turkmenistan’s late President Saparmurat Atayevich Niyazov (1940-2006) created a personality cult that will survive him and probably several successors, including Gurbanguly Berdimuhammedow. The motto he established: Halk, Watan, Turkmenbashy (One Nation, One People, One Leader) can still be seen everywhere throughout Turkmenistan, from the most remote villages to monuments in the capital of Ashgabat.

Even though Berdimuhammedow has promised various reforms, it seems change is slow to come. The Internet is somewhat more available, but access is by no means widespread. One of the best indicators may be the Tolkuchka (“shoving”) market outside Ashgabat, where people come from all over the country to buy and sell, and the selection of carpets remains nothing if not spectacular. The problem, however, is that all but the smallest carpets require an export certificate, and these are still difficult to come by.

Turkmen Customs officials are friendly and have even been known to offer a traveller a drink of vodka, but they still search luggage looking for one thing in particular: carpets!

Turkmenistan’s future lies in its vast natural resources. Turkmenistan ranks fourth in the world to Russia, the United States, and Canada in natural gas and oil extraction. The Turkmenistan Natural Gas Company (Turkmengaz), under the auspices of the Ministry of Oil and Gas, controls gas extraction in the republic. Gas production is the youngest and most dynamic and promising sector of the national economy. Turkmenistan's gas reserves are estimated at 8.1-8.7 trillion cubic meters and its prospecting potential at 10.5. trillion cubic meters. The Ministry of Oil and Gas oversees exploration of new deposits. Sites under exploration are located in Mary Province, in western and northern Turkmenistan, on the right bank of the Amu Darya, and offshore in the Caspian Sea.
Turkmenistan has always described itself as neutral, but this neutrality may not extend to oil and gas. In April 2003, Niyazov signed a 25-year gas deal with Russian President Vladimir Putin under which Russia gained the right to buy most Turkmen gas starting in January 2007.

In 2006, under the contract, Russia was to buy 7 billion-10 billion cubic meters of Turkmen gas.
Then on 29 December, Aleksei Miller of Gazprom signed a new contract in Ashgabat to buy 30 billion cubic meters of gas from Turkmenistan in 2006 at $65 per 1,000 cubic meters. The result is a decidedly pro-Russian and anti-Ukrainian arrangement. Given Ukraine’s pro-European inclinations, the situation could become quite complex if things do not change.

1 comment:

Mariusz said...

thx for the link. First you're arguing that the situation cannot change in fact (e.g. longterm contracts). Then you write: 'given Ukraine’s pro-European inclinations, the situation could become quite complex if things do not change.' What kind of things should change? What should be desirable direction of these changes?