As oil prices continue to concern governments and oil producers around the world, Kazakhstan has stated that it will plough on with plans to increase its oil output, provided that the price per barrel remains above $40. Meanwhile, Turkmenistan has started to transport gas via the East-West pipeline and has launched work to construct a plant for producing gasoline using natural gas. Kyrgyzstan has hosted a forum to boost its work on developing small hydro energy projects, with participants from South Korea, China and Turkey also in attendance.

Initial investment agreement for TAPI pipeline signed

The four nations that are part of the $10-billion Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project have signed an initial investment agreement to turn the deal into a reality.

>From India’s side, state-owned GAIL India Ltd will take a 5% stake in the international consortium, whilst Pakistan’s Interstate Gas Systems (ISGS) and Afghanistan’s Afghan Gas Enterprise (AGE) will each take a 5% stake in the project.

The investment agreement pertains to the 5% shareholding of each of the three gas-importing countries, which means an initial investment of around $200 million.

“We have initialled an investment agreement in Istanbul and the final deal will be signed soon,” says ISGS Managing Director Mobin Saulat.

Kazakhstan balks at freezing oil output

Kazakhstan has indicated that it has no plans to freeze its oil output, as suggested by a group of major producers, and would instead ramp up production to its original target of 77 million tonnes per year if the oil price stays above $40 a barrel.

Energy Minister Vladimir Shkolnik also signalled that Kazakhstan, the biggest ex-Soviet oil producer after Russia, had not been invited to take part in a planned meeting of OPEC and non-OPEC oil producers to discuss freezing output.

In its budget in November, the Kazakh government had an oil output target of 77 million tonnes in 2016, assuming an average oil price of $40 per barrel, but it lowered the target to 74 million tonnes last month as Brent crude hovered closer to $30.

“If the average price is about $40, the output will be 77 million tonnes,” Shkolnik said.

Turkmenistan starts gas transportation via East-West pipeline

The 733-kilometre East-West pipeline has a capacity of 30 billion cubic metres of gas per year.

The natural gas transported via the pipeline will be considered as a source for the gasoline production enterprise that is now under construction and for agricultural fertilizer plants, and will be delivered to gas turbine power plants in the Ahal province.

Turkmenistan’s Oil and Gas Ministry has said that by uniting all large gas fields in one system, the East-West gas pipeline also creates conditions for exporting Turkmen fuel to international markets in any direction.

It has previously been reported that the export of energy resources to Europe is one of the priorities of Turkmenistan’s energy strategy.

Turkmenistan to make gasoline out of natural gas

Turkmenistan has launched work to construct a plant for producing gasoline using natural gas in the country’s Ahal region.

The plant’s construction project is being implemented in line with a contract between Turkmenistan’s Turkmengas State Concern and a consortium of companies, which includes Japan’s Kawasaki Heavy Industries Ltd and Turkey’s Renaissance Holding.

The project’s total cost is estimated at $1.7 billion and the plant is due to be commissioned in December 2018. It will process about 1.8 billion cubic metres of natural gas annually, whilst also producing 600,000 tonnes of high-quality RON-92 gasoline.

Sasol to review its participation in Uzbekistan GTL project

South African energy and chemicals group Sasol is considering dropping its participation in a gas-to-liquids plant in Uzbekistan due to low oil prices, the company said in a statement on 7 March 2016.

“In light of the current economic environment, in February 2016 we decided to review our long-term strategic interest in the Uzbekistan GTL investment,” the company’s statement reads. “The review is expected to be completed in the second half of the 2016 financial year.”

Uzbekneftegaz, Petronas and Sasol Synfuels International (PTY) Limited signed charter and constituent agreements relating to the joint venture with Uzbekistan GTL in November 2009. Sasol and Uzbekneftegaz currently hold a 44.5% stake in the project, whilst Petronas holds an 11% stake.

The plant will process 3.5 billion cubic metres of gas and produce 863,000 tonnes of diesel fuel, 304,000 tonnes of aviation kerosene, 395,000 tonnes of naphtha and 11,200 tonnes of liquefied gas. The $5.6-billion project will be financed by the venture’s founders’ own resources, along with a consortium of banks and financial institutions, which issue loans on project financing terms.

USAID helps diversify export of horticultural products from Uzbekistan

Over 500 representatives of retail chains, business associations, transport and logistics companies, embassies, farmers, and growers from the European Union, Central Asia and other CIS countries joined together in a forum entitled “Horticulture Sector of Fergana Valley: Export Perspectives”, which was convened by USAID’s Regional Economic Cooperation (REC) Project.

The forum brought together parties to negotiate deals for fresh and processed horticultural products from the fertile Fergana Valley.

Initial conservative estimates point to more than $130 million in letters of intent for trade relationships between Uzbekistan’s various horticulture players and external partners.

Tajikistan ready to become CPEC partner

The Ambassador of Tajikistan, Sherali Saidamir Jononove, has said that Pakistan-Tajikistan bilateral trade and economic relations would be further strengthened following the finalisation of a trilateral transit trade agreement between Pakistan, Afghanistan and Tajikistan (PAT).

“Early finalisation of the trilateral agreement on transit trade between Pakistan, Afghanistan and Tajikistan will contribute to economic and trade relations and will give greater impetus to regional cooperation," Sherali said. When asked about the future of economic ties between the two countries, he said that Pakistan had a very important geo-strategic location in the region and that Tajikistan would benefit from this opportunity, becoming a partner of the China Pakistan Economic Corridor (CPEC).

Sherali also said that Tajikistan would export more than 1,000 megawatts of hydroelectric electricity to Pakistan under the Central Asia South Asia (CASA) 1000 project.

Kyrgyzstan working on developing small hydro energy

Bishkek has hosted the first national discussion on “Challenges and ways of development of small hydropower in the Kyrgyz Republic.” More than 100 participants discussed the current situation in the area and the investment climate, and learned about the new concept of developing small hydropower in the Kyrgyz Republic for 2015-2017.

The main goal of the meeting, which was chaired by the Vice-Prime Minister Valery Dil, was to develop partnerships between stakeholders interested in small hydropower in Kyrgyzstan. Participants included representatives of both local companies and companies from South Korea, China and Turkey, and government and non-government organisations.

“Small hydropower would allow a breakthrough in this area. But it needs a small investment that will allow quick returns on investment”, said Dil.