IRAN MOVES INTO THE FOREGROUND AS TRANSIT COUNTRY FOR TURKMEN OIL AND GAS.

Iranian foreign minister Kamal Kharrazi conferred in Ashgabat with President Saparmurad Niazov and other senior Turkmen officials on export routes for that country’s immense, if incompletely estimated, oil and gas resources. The discussions resulted in the signing of protocols of intent on three projects:

— An oil export pipeline from Turkmenistan’s Caspian shore across Iran to the Persian Gulf. The sides decided to hold a meeting of Iranian, Turkmen, and Western experts for detailed discussion as early as next week and to finalize the technical blueprint by December.

— A 200-kilometer pipeline from Turkmenistan’s Korpeje gas fields to Kurd-Kui in northern Iran, where it would link up with Iran’s pipeline system. The sides decided to begin construction work in December and commission the pipeline within a year, at an initial throughput capacity of 3 billion cubic meters annually, to be increased to 8 billion by the year 2006. Iran will guarantee to buy the entire amount, possibly for reexport, for a 25-year period.

— A transcontinental gas pipeline from Turkmenistan via Iran to Turkey and further to Europe. Niazov and Kharrazi decided to call a meeting of the Iranian, Turkmen, and Turkish oil and gas ministers to map out the project next month. They expressed hope that the formation of an international consortium might begin as early as December. Some leading Western companies have expressed interest in the project, whose cost is estimated at $2.5 billion.

Additionally, Turkmenistan and Iran agreed to create a bilateral commission on the legal status of the Caspian Sea and delimitation of their mutual maritime border; and a bilateral consortium to develop offshore oil and gas deposits that straddle the two countries’ continental shelves. The Turkmen leaders decided to exclude three such deposits from the international tender that Ashgabat launched last month for the development of 11 offshore fields; those are now reduced to eight. Despite this concession, Ashgabat seems to have scored a diplomatic success by inducing Iran to weaken its opposition to sectoral division of the Caspian Sea. Kharrazi was cited as using the term "territorial waters" with reference to Iran’s and Turkmenistan’s overlapping claims to those three deposits. (Western and Russian agencies, IRNA, Vision of the Islamic Republic of Iran, October 13-15)

A U.S. State Department spokesman yesterday denied an assertion, attributed to Turkmen foreign minister Boris Shikhmuradov, that Washington had given the Turkmenistan-Turkey gas pipeline a "greenish light." The spokesman said that Washington is studying the matter and that it prefers that Central Asian oil and gas exports bypass Iran. (Western agencies, October 16) However, the U.S. has recently differentiated between investment projects in Iran, which it opposes under the Iran-Libya Sanctions Act, and transportation projects via Iran, on which the U.S. position is more nuanced.

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