Identifier
Created
Classification
Origin
06ASHGABAT932
2006-09-05 12:46:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ashgabat
Cable title:
GAZPROM SIGNS $100/TCM DEAL FOR TURKMENISTAN'S NATURAL GAS
how-toVZCZCXRO1144 PP RUEHAST DE RUEHAH #0932 2481246 ZNR UUUUU ZZH P 051246Z SEP 06 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC PRIORITY 7757 INFO RUCNOSC/OSCE POST COLLECTIVE RUCNCIS/CIS COLLECTIVE RHMFIUU/CDR USCENTCOM MACDILL AFB FL//CCJ2/HSE/CCJ5// RUEKJCS/SECDEF WASHINGTON DC RUEKJCS/JOINT STAFF WASHINGTON DC//J5/RUE// RUEAIIA/CIA WASHDC RHEFDIA/DIA WASHDC
UNCLAS ASHGABAT 000932
SIPDIS
STATE FOR SCA/CEN (PERRY)
SENSITIVE, SIPDIS
E.O. 12958: N/A
TAGS: EPET ECON ETRD PREL TX
SUBJECT: GAZPROM SIGNS $100/TCM DEAL FOR TURKMENISTAN'S NATURAL GAS
REF: A) ASHGABAT 699
B) ASHGABAT 624
C) ASGHABAT 327
UNCLAS ASHGABAT 000932
SIPDIS
STATE FOR SCA/CEN (PERRY)
SENSITIVE, SIPDIS
E.O. 12958: N/A
TAGS: EPET ECON ETRD PREL TX
SUBJECT: GAZPROM SIGNS $100/TCM DEAL FOR TURKMENISTAN'S NATURAL GAS
REF: A) ASHGABAT 699
B) ASHGABAT 624
C) ASGHABAT 327
1. (SBU) Local Turkmen media reported that visiting Gazprom
chairman Alexei Miller initialed an agreement September 5 with
President Niyazov to purchase natural gas for $100 per thousand
cubic meters (tcm). According to the terms of the contract,
Turkmenistan will supply 162 billion cubic meters (bcm) of natural
gas to Gazprom through the end of 2009. Turkmenistan will provide
12 bcm of natural gas through the end of this year, and 50 bcm for
each of the following three years.
2. (SBU) In comments attributed to Niyazov during the discussions,
Niyazov pledged that Russia would be "first priority" in natural gas
supplies. However, Niyazov claimed that Turkmenistan could also
fulfill potential commitments to the Trans-Afghan Pipeline, China,
the United Arab Emirates and other projects. He reportedly stated
that the mooted Trans-Caspian pipeline lacked a firm proposal and
suffered from "politicized" issues. Embassy will survey interested
parties, e.g., Ukraine, China, Turkey, Pakistan and report
additional developments as details and information become available.
Comment
--------------
3. (SBU) If media reports are accurate, Niyazov succeeded in
forcing the Russians to pay his requested price for natural gas.
Reftels outlined Niyazov's approach and insistence on the $100/tcm
price. Niyazov likely realized the key limitation on the price he
could receive -- namely the sole pipeline network through Russia --
and achieved what he viewed as a realistic price in the
Gazprom-monopolized marketplace. The impact on downstream
customers, such as Ukraine, should become increasingly clear as
Switzerland-based RusUkrEnergo factors in the $100/tcm cost into its
calculations for charging Ukraine for future natural gas
deliveries.
4. (SBU) Niyazov's reported pledge of his natural gas supplies to
Russia first and foremost will refocus attention on other natural
gas projects discussed in Ashgabat recently. The rhetoric regarding
the Trans-Afghan Pipeline, supplies to China and elsewhere may have
encouraged the Russians to accept Niyazov's asking price. As
Niyazov measures the volume of his natural gas reserves and the
amount he has now committed to Gazprom, Niyazov's true priorities
with respect to other natural gas projects should become
increasingly apparent in the coming months.
Brush
SIPDIS
STATE FOR SCA/CEN (PERRY)
SENSITIVE, SIPDIS
E.O. 12958: N/A
TAGS: EPET ECON ETRD PREL TX
SUBJECT: GAZPROM SIGNS $100/TCM DEAL FOR TURKMENISTAN'S NATURAL GAS
REF: A) ASHGABAT 699
B) ASHGABAT 624
C) ASGHABAT 327
1. (SBU) Local Turkmen media reported that visiting Gazprom
chairman Alexei Miller initialed an agreement September 5 with
President Niyazov to purchase natural gas for $100 per thousand
cubic meters (tcm). According to the terms of the contract,
Turkmenistan will supply 162 billion cubic meters (bcm) of natural
gas to Gazprom through the end of 2009. Turkmenistan will provide
12 bcm of natural gas through the end of this year, and 50 bcm for
each of the following three years.
2. (SBU) In comments attributed to Niyazov during the discussions,
Niyazov pledged that Russia would be "first priority" in natural gas
supplies. However, Niyazov claimed that Turkmenistan could also
fulfill potential commitments to the Trans-Afghan Pipeline, China,
the United Arab Emirates and other projects. He reportedly stated
that the mooted Trans-Caspian pipeline lacked a firm proposal and
suffered from "politicized" issues. Embassy will survey interested
parties, e.g., Ukraine, China, Turkey, Pakistan and report
additional developments as details and information become available.
Comment
--------------
3. (SBU) If media reports are accurate, Niyazov succeeded in
forcing the Russians to pay his requested price for natural gas.
Reftels outlined Niyazov's approach and insistence on the $100/tcm
price. Niyazov likely realized the key limitation on the price he
could receive -- namely the sole pipeline network through Russia --
and achieved what he viewed as a realistic price in the
Gazprom-monopolized marketplace. The impact on downstream
customers, such as Ukraine, should become increasingly clear as
Switzerland-based RusUkrEnergo factors in the $100/tcm cost into its
calculations for charging Ukraine for future natural gas
deliveries.
4. (SBU) Niyazov's reported pledge of his natural gas supplies to
Russia first and foremost will refocus attention on other natural
gas projects discussed in Ashgabat recently. The rhetoric regarding
the Trans-Afghan Pipeline, supplies to China and elsewhere may have
encouraged the Russians to accept Niyazov's asking price. As
Niyazov measures the volume of his natural gas reserves and the
amount he has now committed to Gazprom, Niyazov's true priorities
with respect to other natural gas projects should become
increasingly apparent in the coming months.
Brush