Three Central Asian States Discuss Downsizing Natural Gas Supply into China

Chairman of Uzbekneftegaz company Mekhriddin Abdullayev told S&P Global Platts edition that  Turkmenistan, Kazakhstan and Uzbekistan are now in discussion to downsize their natural gas supply into China. Because of the coronavirus pandemic, the demand for this type of fuel has heavily declined.

According to Abduallayev, the government of China asked to downsize supplies from all three states proportionally.

«The coordination committee which includes all Central Asian states that are natural gas exporters to China now discuss precise volumes of downsizing. The decision has not yet been taken,» Abdullayev stated.

As S&P Global Platts wrote, Uzbekistan provides China with 10 billion cubic meters of gas per year. According to Chinese customs authorities, last year Kazakhstan and Turkmenistan supplied that country about 7.1 and 33.2 billion cubic meters of gas respectively. 

The prior goal for Uzbekistan is to stop gas exports during the next decade, Abdullayev said. The country plans to process all that natural gas on its own to get more profit from gas refining. To achieve this goal, Uzbekneftegaz already launched new projects and investing in them. One of these projects is the construction of the Oltin Yo’l GTL plant, which will be able to reprocess roughly 3.6 billion cubic meters of natural gas. All works should be finished by the end of this year with $3.6 billion of investments.

According to the Uzbekistan State Statistics Committee, in the first quarter of 2020, the output of natural gas in the country declined from 14.17 to 13.07 billion cubic meters of gas or 7.8% compared to the same period last year.