TURKMENISTAN: PORT AT TURKMENBASHY TO GET FULL

UNCLAS SECTION 01 OF 02 ASHGABAT 000428 SENSITIVE SIPDIS SCA/CEN; EEB PLEASE PASS TO USTDA DAN STEIN ENERGY FOR EKIMOFF/THOMPSON COMMERCE FOR HUEPER E.O. 12958: N/A TAGS: PGOV ECON EINV TX SUBJECT: TURKMENISTAN: PORT AT TURKMENBASHY TO GET FULL RENOVATION ¶1. (SBU) SUMMARY: The port at Turkmenbashy will soon undergo a complete renovation that will modernize and expand its facilities and capacity as the largest Central Asian port. Port authorities say there will be a new ship repair yard and new cargo handling facilities. In the longer term, a major cargo handling and processing facility is planned, and there is interest in buying more cargo and tanker ships. The renovation is probably a good idea, but expansion of the port's footprint further inland could adversely impact the more historically interesting parts of the old city. END SUMMARY. ¶2. (SBU) Poloff met on April 1 with the deputy representative of the Turkmen Marine and Riverways Administration in Turkmenbashy to learn about ongoing developments regarding the city's port. The representative said Turkmenbashy was the largest seaport in Central Asia, and that demand for its services was growing rapidly. It has two piers, and some 900,000 tons of cargo came through it last year. He claimed that some 70 foreign tankers come through the port each month, as well as some 150 dry cargo ships. ¶3. (SBU) The Administration currently operates one oil tanker that moves crude from Turkmenbashy to a quay at the southern coastal town of Ekerem, from where the oil is then taken aboard by private tankers. The Administration is also currently operating one dry cargo ship, which was recently refurbished at the shipyard in Astrakhan, but two others will be brought online soon. He mentioned the regular operations of the Azerbaijani rail ferry, which takes rail cars, truck cargo and passengers between Turkmenbashy and Baku. ¶4. (SBU) The representative said there were plans to completely refurbish and modernize the port's facilities and to add some new facilities in the next few years. The project is estimated to cost 2.5 billion Euros, he noted. Plans include modernization of the piers and heavy cargo transport equipment, and addition of a shipyard that will initially handle ship repairs. The tender, he said, had already been announced, and decisions would be made in July ¶2009. When asked who the main commercial competitors were for the contract, he said there were multiple companies that were interested, including Turkish and South Korean companies, but the Turkmen government is receptive to all interested parties. ¶5. (SBU) He said they had no plans now to purchase any ships, since the infrastructure was not yet ready to handle an increase in operations. The first priority would be to modernize existing facilities and build a shipyard, then in the longer term the Administration was planning to develop a logistics center to handle large-scale on- and off-load of dry cargo. Additional tankers and cargo ships would be considered after these goals are achieved, he said. ¶6. (SBU) COMMENT: Although much of the port's facilities appear to have been fairly recently refurbished, it appears the central government is intent on completely overhauling it. Once completed, it should be able to handle the growing amount of largely imported cargo and the variety of petroleum products that move through it. However, the port is tightly enclosed by the streets of the old part of the city. If plans include a substantial expansion of the port's footprint, it could mean demolition of historical elements of the old city, some buildings of which are more than 80 years old. Time will tell how the reconstruction will be carried out. END COMMENT. ASHGABAT 00000428 002 OF 002 MILES