Turkmenistan has just discovered what might be the fourth largest natural gas field on earth. I am sure that Gazprom doesn’t like this development whatsoever. From the Asia Times:
British consultancy firm Gaffney, Cline & Associates (GCA), making the announcement in Ashgabat regarding the first results of its audit of Turkmen gas reserves, said its low estimate under the established international and classification system is that the fields may have a minimum 4 trillion cubic meters of gas and as much as a staggering 14 trillion cubic meters. This catapults Yoloten-Osman, in the southeast of the country, to the status of Turkmenistan’s No 1 gas field, overtaking even the fabulous Dowalatabad, whose reserves it will exceed by at least five times. It should be kept in mind that many other of Turkmenistan’s many gas fields have yet to be fully explored, and the GCA has just made its initial findings known.
Without doubt, Turkmenistan is closing its gap with Russia and Iran, hitherto listed as having the world’s largest and second-largest gas reserves at 48 trillion cubic meters and 26 billion cubic meters, respectively. If the GCA results are confirmed, Turkmenistan will have reserves just 20% lower than that of Russia and outstrip Iran by far.It seems the late Turkmenistan president Saparmurat Niyazov stands vindicated. Just before he died in December 2006, Niyazov remarked that Turkmenistan held reserves that were adequate to export 150 billion cubic meters (BCM) of gas for the next 250 years. The world, including the then visiting German foreign minister Frank-Walter Steinmeier, didn’t take Niyazov’s statement seriously.In March, Niayov’s successor, Gurbanguly Berdimukhamedov, ordered the GCA audit to clear doubts about Turkmenbashi’s controversial claim. In a British understatement, GCA manager Jim Gillet said in Ashgabat, “Given the huge gas reserves, it is now clear that whatever the results of any final clarification, I can confirm that there is more than sufficient gas to fulfill Turkmenistan’s existing contract commitments.” Turkmenistan has contracts to supply Russia with around 50 bcm annually, China with 40 bcm and with Iran 8 bcm.Without doubt, the maths of energy security is being reset. October 13 will stand out as a watershed in the race for Caspian energy. Like the shy Akhal-Teke, Turkmenistan comes from behind and surges ahead on the race tracks, captivating the world audience, especially the main wagerers – Russian, European, Chinese and the ubiquitous Americans. For these seasoned hands betting on the race track, this will also be pari-mutuel wagering, as the French would say, meaning “among ourselves”, with betting against each other and not against the race track.Turkmenistan is undoubtedly a vital partner for Russia in gas supplies. The two countries have an agreement regarding gas prices and the volume of gas supplies for 2007-2009. Ashgabat has been extracting higher and higher prices from Russia for its gas supplies. The price was raised to $100 per 1,000 cubic meters last year from the level of $65. Then it was further raised to $130 for January-June 2008 and to $150 in the second half of 2008.Ashgabat has been playing on the nerves of Russian energy giant Gazprom and its desperate need for Turkmen gas to meet its export obligations in the European market, which accounts for 70% of the Russian company’s total revenue at the moment. Gazprom sells close to two-thirds of Russia’s 550 bcm annual gas production in the rapidly growing domestic market, which compels it to secure Turkmen supplies to meet the contracted European commitments.