Turkmenistan is ready to export its natural gas to Kazakhstan
According to Gurbanguly Berdimuhamedow, the national leader of the Turkmen people, chairman of the People’s Council of Turkmenistan, member of the Council of Elders of the Organization of Turkic States (OTS) and ex-president of Turkmenistan, his country is ready to start exporting gas to Kazakhstan.
«We have good opportunities for exporting Turkmenistani natural gas and electricity to Kazakhstan, Azerbaijan and Turkey. We are ready to continue to give a hand to our fraternal countries to secure their energy security,» he said while delivering a speech at the 15th Meeting of the Council of Elders of the OTS in Ashgabat.
He noted that Turkmenistan is one of the biggest producers of energy resources in the world and the country is ready to launch exports of these resources to fraternal countries and boost such exports if needed. Currently, Turkmenistan exports electricity to Uzbekistan and Kyrgyzstan. These states are also discussing ambitious projects related to exporting Turkmenistan’s natural gas farther to the east.
According to Berdimuhamedow, Turkmenistan wants to create a new model of partnership that would be effective, reliable and sustainable despite uncertainty in global energy markets and secure the growing needs of neighboring countries.
Turkmenistan is also a big exporter of natural gas to China. Its export of 40 billion cubic meters of gas goes via three gas pipelines with a combined capacity of 55 billion cubic meters of gas. These pipelines stretch through the territory of Kazakhstan and Uzbekistan. The remaining capacity of 15 billion cubic meters is exploited by the two countries which also export natural gas to the PRC.
Central Asian states have to rely on each other in order to secure effective gas supply schemes. For instance, QazaqGaz, a gas company in Kazakhstan, supplies the gas it produces in Western Kazakhstan to the southern region of the country via the Republic of Karakalpakstan, part of Uzbekistan.
In turn, Uzbekistani gas companies supply their gas to Tashkent, the capital city of Uzbekistan via Kazakhstan’s territory. After an official visit of President Kassym-Jomart Tokayev to Tashkent these arrangements have been extended until the end of 2025.
Kazakhstan needs this time to complete the construction of the second Beineu-Bozoy-Shymkent gas pipeline with a capacity of 15 billion cubic meters per year. This capacity is expected to be increased gradually. For example, at the initial stage, the pipeline will have a capacity of 4 billion cubic meters of gas per year. This gas will be supplied from various gas fields in the Aktobe region. Once QazaqGaz builds additional compressor stations, it will be able to supply gas from Western Kazakhstan and boost the pipeline’s capacity to 15 billion cubic meters per year.
In 2023, QazaqGaz reported $388.9 million in losses, according to the company’s CEO Sanzhar Zharkeshov. As he noted, the company is working on the development of its resource base and is conducting a reform of natural gas pricing as the demand for gas from the population and industrial entities has been growing.
QazaqGaz is the biggest gas company in Kazakhstan involved both in gas supply to domestic customers and its export abroad. According to the company, Kazakhstan’s export abilities are shrinking as internal consumption steadily grows. The export of gas to China is crucial for domestic supplies as QazaqGaz uses foreign exchange revenue to subsidize prices for regular domestic customers.
In 2022, net income of QazaqGaz slipped by 3.4% to $859 million compared to 2021. The company didn’t make dividend payouts for 2021, and spent $60 million or 7% of its net profit on dividend payouts to Samruk Kazyna, its sole shareholder, in 2022.
In 2025, QazaqGaz is expected to go public, although this can’t happen until the tariff policy issue is solved, according to Nurlan Zhakupov, head of Samruk Kazyna.
