In an effort to promote investment possibilities in their country, high-ranking government officials and energy experts from Turkmenistan met on November 4-5 with major U.S. energy companies and business representatives in Houston, Texas. The Houston talks follow an October 30 meeting in Ashgabat between the U.S. ambassador at large for the NIS, Stephen Sestanovich, and Turkmen president Saparmurad Niazov. The two discussed "issues of mutual concern," and the Turkmen leader explained his country’s need to increase energy exports — which will soon involve a pipeline route going through Iran to Turkey.
Of concern to the U.S. is the Turkmen government’s recent withdrawal of three of the 11 blocks that are part of the Turkmen Caspian Sea offshore oil and gas tender. The three blocks contain an estimated 484 billion cubic meters of gas and 736 million tons of oil — which are 27 percent and 32 percent, respectively, of the 1.8 trillion cubic meters gas and 2.3 billion tons oil for the entire eleven blocks. No reason was given for the withdrawal. However, the fact that the blocks are located near the Turkmen-Iranian border suggests that they could later become part of a joint offshore oil and gas project recently discussed by Turkmenistan with Iran. Turkmen officials argue that collaborative work in this region would help allay potential disputes over the ownership of the offshore sites. (Turkmen and International agencies, October 14, November 3, 5)
Turkmen officials also hope that a recent agreement with Ukraine, under which Turkmenistan is to ship to Ukraine 3 billion cubic meters of gas over the remainder of 1997, and 15-20 billion cubic meters of gas in 1998, will help Turkmenistan in some way to obtain revenues for its resource exports. Included in the documents signed by Niazov and Ukrainian deputy prime minister Anatoly Holubchenko on October 30 is a debt payment schedule (for the $44.5 million that Ukraine owes Turkmenistan), an agreement on construction of industrial facilities in Turkmenistan by Ukrainian firms, and one involving a trilateral swap of these goods and services between the two states and Iran. (Turkmen television, October 30)
Recently-released economic figures for the first three quarters of 1997 underscore Turkmenistan’s need to accelerate energy extraction. Although not as bad as those of past years, the 1997 figures indicate that the Turkmen economy is continuing to shrink and that the energy sector, upon which the economy rests, remains sluggish despite an anticipated "boom" in production and revenues. Official statistics note a 4.2 percent increase in the extraction of oil and gas condensate. However, a failure by CIS recipients of Turkmen gas to pay their bills has dampened any effort to reinvest funds in the industrial and energy sectors, as had been planned for this year. (Turkmen Press news agency, November 3) In short, pressures to turn the domestic economy around will only encourage Turkmenistan to seek a variety of agreements and partners in future energy deals.
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