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Russia clinches oil pipeline deal

Vladimir Radyuhin

U.S. plan to build conduit suffers setback

MOSCOW: Russia on Saturday signed two landmark pacts with Central Asian states to build natural gas pipelines that would cement Moscow's control over the region's energy resources and thwart Western efforts to divert their exports away from Russia.

Meeting in Turkmenistan's city of Turkmenbashi on the Caspian Sea, the leaders of Russia, Turkmenistan and Kazakhstan agreed to construct a $1-billion 500-km gas pipeline to export Turkmen gas via Kazakhstan and Russia to Europe.

Separate agreement

Under a separate agreement signed in Turkmenbashi, Russia, Turkmenistan, Kazakhstan and Uzbekistan agreed to overhaul and expand a Soviet-era gas pipeline carrying Central Asian gas through Uzbekistan to Russia.

The two proposed pipelines will carry up to 90 billion cubic metres of gas by 2028, Russia's Energy Minister Viktor Khristenko said. This is a major success for Russia, enabling it to retain control over the bulk of Central Asian gas exports.

The deals are also a blow to an alternative plan lobbied by the United States to build a gas pipeline across the Caspian Sea to ship Central Asian gas via Azerbaijan and Georgia to Europe, bypassing Russia.

Mr. Putin's week-long tour of Central Asia was deliberately timed to coincide with an energy summit in Poland which invited the leaders of Azerbaijan, Georgia, Ukraine and Kazakhstan to discuss oil and gas routes to Europe around Russia. The President of Kazakhstan, whose involvement in alternative energy export projects is critical to make them a success, stayed away from the Polish meet to host the Russian leader.

On Thursday, Russia and Kazakhstan also agreed to expand a pipeline that carries Kazakhstan's oil to the Russian Black Sea port of Novorossiisk.

PTI reports:

So far, Russia has been the sole re-exporter of Turkmen gas to the European markets.

Kazakhstan and Turkmenistan have rich oil and natural gas stocks which the U.S. and European Union were striving to divert through a pipeline linking them with Azerbaijan to bypass Russia.

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