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Monday, September 17, 2007

Kazakhs and Turkmen eye market routes

11 September 2007 - Upstream Online - Kazakh President Nursultan Nazarbayev told Turkmen officials today that the two countries should take advantage of "beneficial" energy prices, a move that could upset the traditional buyer of its resources, Russia. Nazarbayev also hinted that construction could soon begin of the US-backed trans-Caspian pipeline, which would bypass Russia and take 30 billion cubic metres a year of Turkmen gas along the seabed to Azerbaijan and overland to Europe. The pipeline is scheduled to come on stream in 2010-2011. Analysts have said Russian gas export monopoly Gazprom might oppose the project as it would pose a threat to Russia's monopoly on Central Asian gas exports to Europe. Nazarbayev is visiting Turkmen President Kurbanguly Berdymukhamedov in the Turkmen capital Ashgabat for two days, Reuters reported. Meetings between the Kazakh leader and the previous Turkmen president, Saparmurat Niyazov, who died in December, were rare. "The energy issue is one of great global importance. Everyone is looking for an alternative to a single source," Nazarbayev told a news conference with Berdymukhamedov. "We have a common interest: to sell our energy resources on the international market and sell at prices which are beneficial and will help the development of our nations and people in the future." Berdymukhamedov, who will soon attend a UN General Assembly meeting in the US, backed Nazarbayev's call for a competitive market environment. "We are also exploring north-south transport routes," he said, re-emphasising Turkmenistan's intention to build a gas pipeline to China through Kazakhstan. The pipeline, with an annual capacity of 30 billion cubic metres, will start in the east of the country on the right bank of the Amu Darya River and pass through Uzbekistan and Kazakhstan. Transit country Kazakhstan said it would allow 1300 kilometres of the pipeline to be built on its territory. It is still unclear whether Uzbekistan has agreed to the plan. In May, the two leaders signed an agreement with Russian President Vladimir Putin to build a new natural gas pipeline around the Caspian Sea, a move that bolstered Russia's dominance over the region's gas exports.

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