Topic: Economy & business
Considerable progress has been achieved since Turkmenistan and the European Union established co-operation in the energy sector 10 years ago. Turkmenistan and the EU maintain long-term partner relationships including those developed within the framework of the INOGATE Programme elaborated in collaboration with the EU’s TACIS Programme and aimed at working out investment projects, providing assistance in concluding contracts and realising the potential of co-operation in the sector.
According to the European Commission, Turkmenistan’s abundant energy resources is of special importance for achieving the sustainable economic and social development that creates necessary prerequisites for maintaining the peace, stability and prosperity throughout the region.
Turkmenistan’s depths contain a great amount of active reserves, and the entry to the new consumer markets will serve as a powerful stimulus for further promotion of foreign investors. The stable and reliable legal basis protecting the investors’ interests as well as providing the wide opportunities to establish long-term business partnership and the present favourable economic and investment climate attract more and more foreign partners and the leading oil and gas companies in Turkmenistan.
Turkmenistan’s oil and gas industry, including the transport infrastructure of the base sector of the national economy, are developing in accordance with the National Programme Strategy of Economic, Political and Cultural Development of Turkmenistan till 2020. At present, the international companies such as Petronas, Maersk, Burren Energy, Dragon Oil and Mitro International Ltd are successfully operating and making investments in the oil and gas industry of Turkmenistan. According to the latest statistical investigations, the foreign partners have considerably increased their share in the total investment volume taking the wide opportunities of realising Turkmenistan’s energy potential into consideration.
During the years of independence Turkmenistan made its foreign-economic activity more active being integrated in the world economy and pursuing the open-door policy proclaimed by the head of the Turkmen state. The open-door policy promoted establishing and maintaining mutually beneficial co-operation with all the international bodies. Over 100 contracts for oil products supply with more than 60 companies, most of which are the long-term partners of our country, were concluded in 2004.
Occupying the leading positions in energy production Turkmenistan also ranks among the largest ‘blue fuel’ producers and exporters and possesses substantial potential for increasing gas production and export. Therefore, under the tendency towards increasing hydrocarbons and by-products consumption observed at the present times, the special importance is attached to increase in export of Turkmen oil and gas in the world markets.
The fuel exporters as well as consumers are interested in enhancing Turkmen energy transit to foreign countries. It is the field of application mutual actions where it is necessary to seek the progressive mutually acceptable forms and conditions of co-operation.
The realisation of Turkmenistan’s huge potential as an exporter of hydrocarbons depends on the availability of the long-term investment contracts and agreements on transportation of Turkmen raw materials through the territories of the neighbouring countries, in most degree. The main task is to implement the projects contributing to increase in the supply and reliable transportation of energy resources.
The issues of export of Turkmen energy resources to the international markets were considered at the round-table discussion held in Ashgabat on 2-3 March 2005. The representatives of the Energy Charter Secretariat, European Union, European Bank of Reconstruction and Development, the world-famous companies operating in the Turkmen oil and gas market, the leaders of the concerns and corporations of the domestic fuel and energy complex and some diplomats accredited to Turkmenistan participated in the international forum.
The participants of the forum also discussed the prospects of expansion of mutually beneficial international co-operation and considered the variants of the supply of Turkmen hydrocarbons in the international markets, the investment-related provisions of the Energy Charter Treaty aimed at the creation of the appropriate investment climate in all the Energy Charter’s member states.
The participants of the forum noted that considerable increase in the supply of ‘blue fuel’ to Europe provided the good opportunities for the new suppliers including Turkmenistan as the EU’s long-term and reliable partner.
Investments in the energy resources production and infrastructure as well as the market entry are issues requiring more serious and thorough understanding and a constructive approach. In this context the Energy Charter Treaty is a multilateral instrument, dealing specifically with inter-governmental co-operation in the energy sector. Turkmenistan was among the countries, which were the first to sign and accede to the Treaty. At present Turkmenistan is the Charter’s participating state.
The Energy Charter takes much effort to facilitate the transit of energy on a non-discriminatory basis consistent with the principle of freedom of transit. The Charter’s participating states have looked to enhance the Treaty’s provisions on transit through the elaboration of the Transit Protocol. The Transit Protocol is a functional legal document aiming to develop a regime of the commonly accepted operative principles covering the transit flows of energy resources. Most of the Charter’s participating states recognised the necessity of adoption of this document.
The point is to reach the new stage in realisation of the huge potential of regional and international co-operation in the energy sector.
Turkmenistan: the Golden Age