Along with possession of huge potentials in oil, gas, as well as alternative sources of energy, Turkmenistan in the epoch of Great Revival has strengthened its energy-country status by successful implementation of development strategy in the field. Achieved results in the energy field, as long as other sectors of the country's economy, enabled further rapid development of Turkmenistan's economy and placed Turkmenistan among few countries which achieved economic growth during global economic crisis. International Monetary Fund (IMF) estimates that as the results of this year Turkmenistan would be included in the list of countries with the fastest economic growth worldwide. It is expected that Turkmenistan's GDP growth rate for this year would exceed global GDP growth rate 3 times. Thus, it would be appropriate to briefly analyze one of the most important sectors of economy, the energy sector of Turkmenistan.

Exploration of Natural Gas Reserves

In the process of analysis of improvements in the oil-and-gas industry of Turkmenistan foremost attention should be paid to international audit and approval of the country's natural gas reserves. The results of the audit have determined main direction of future energy policy of the country. In addition, it worth to mentioned that as the result of the international independent audit South Yoleten - Osman field was placed among the world's largest natural gas fields. In accordance with the report of the Gaffney Cline & Associates British international independent audit company, after examination of available data it has been determined that the South Yoleten - Osman field reserves are as follows: low estimates - 4 BCM, optimum estimates - 6 BCM, and high estimates - 14 BCM. While considering the latest data, these numbers could increase up to 16-18 BCM. The reserves of Yashlar field, on the other hand, currently estimated at: low estimates - 0,25 BCM; optimum estimates - 0,675 BCM; high estimates - 1,5 BCM of natural gas. The International Energy Agency's (IEA) "World Energy Outlook -2009", published at the end of last year, has given the list of the largest natural gas fields explored in 2008, whereas South Yoleten and Yashlar fields were placed on the first two lines of the list consequently. Information about the natural gas reserves of Turkmenistan have been gaining international attention upon exploration of the abovementioned South Yotelen and Yashla fields reserves. And Turkmenistan's such position is being widely mentioned in current energy related books, publications or conferences held worldwide. The effects of the country's successful energy policy could be seen in the analysis of BP's annual publication, BP Sta¬tis¬tical Review of World Ener¬gy. In accordance with the publication total worldwide increase of additional natural gas reserves was equal to 10.44 BCM, from which 54,31% percent was gained by Turkmenistan reserves.

Continuous Development of Energy Infrastructure

After exposition of such huge volumes of natural gas reserves, Turkmenistan has initiated the next phase of its energy strategy, i.e. commenced development of super giant natural gas fields. As has been know, by the end of last year Turkmenistan has commenced the development of the second largest natural gas field in the world, South Yoleten - Osman, by concluding 10 billion USD contracts. This would, in its turn, result in considerable increase in natural gas production capabilities of Turkmenistan.

Recent commencement of "East-West" natural gas pipeline project would ensure further development of energy infrastructure of the country, efficient domestic consumption of natural gas, as well as increase export capabilities of the country. Pipeline with starting point at the "Shatlyk" gas compressor station on the Dowletabat-Deryalyk pipeline and termination point at the "Belek-1" gas compressor station in Balkan region is planned to be commissioned in 2015. 1000 km long pipeline with international prospects would have capacity of 30 BCM annually. Project cost is estimated at more than 2 billion USD.

Turkmenistan: Spotlight for International Investors

Turkmenistan is rapidly developing and gaining prestige on international arena due to chosen socio-economic domestic and foreign policies. Due to these reasons, interest of international investors in Turkmenistan is constantly increasing. While analyzing information in "World Investment Report - 2010", published by UN's UNCTAD organization, we could see that in contrast with last year due to global economic crisis international investment volumes have decreased by 37%, equaling to 1 trillion 114 billion USD. Investment volumes in almost all of the countries in the world have been decreased. Only 20 countries worldwide were able to achieve increase in investments in amount of 1 billion USD or more. Among Germany, Denmark, Finland, Luxemburg, Switzerland, Italy and other similar countries, Turkmenistan was also able to achieve high development rates. As has been mentioned in statements made during the 1st International Gas Congress held in the capital of the country in April, last year only under the existing product sharing agreements (PSA) the amounts of investments have been raised by 81% in comparison with the previous year, and equaled to total of 3 billion 703 million USD. Increase of investment volumes in Turkmenistan during the period of decrease in internationally available investments should not be explained only by the presence of huge hydrocarbon reserves. However, development of investment environment within the country, adoption of laws and legal documents complying with international norms, effective implementation of state policy for attraction of investments, and other similar reasons made it possible for country to attract huge volumes of investments.

International Cooperation in Energy Security Sphere

Very important issue in global energy security sphere was initiated on 19 December 2008. Resolution #63/210 named "Reliable and stable transit of energy and its role in ensuring sustainable development and international cooperation" was initiated by the President of Turkmenistan and unanimously adopted at the UN General Assembly 63rd session. With the help of the resolution UN member-states drew attention to the increasing importance of secure energy transit to international economy and politics, while noticing that the Central Asian region of Eurasia has become essential region for production and transit of energy resources. In addition, the resolution highlighted the importance of reliable and stable energy transit not only to energy producing or exporting country, but to the sustainable development of international economy as well. International conference of the same name was successfully held in the capital city of Turkmenistan, Ashgabat, in accordance with the approved resolution. High-level international conference in Ashgabat has initiated the process for creation of legal framework for international cooperation in secure production, transit and consumption of energy resources.

"Strengthening of international cooperation with Central Asia region for reliable and stable energy transit in Eurasia" conference, organized for the purposes of further development of international cooperation in energy sphere, was successfully held in Ashgabat on May 3-4, 2010. More than 120 representatives from nearly 20 countries have attended the conference. Conference provided grounds for discussion of issues related to methods for uninterrupted energy supply, development of cooperation of this focus, as well as creation of related international level legal framework for implementation of such actions.

Increase of Export Capabilities

As was mentioned by the President of Turkmenistan during the UN General Assembly 62nd session, Turkmenistan is interested in joining pipeline projects which would be economically sound and comply with security and environmental protection standards. Diversification of export pipeline routes was also mentioned as one of the pre-requisites for the projects.

Within the framework of the strategy for diversification of energy export routes, Turkmenistan has developed and closely works under implementation of export pipeline projects to Europe and south direction through current routes, as well as new routes.

Continuous increase of role of Turkmen natural gas exported to the Chinese market is well known to us all. In addition, currently, during the official visit of the member of Social Bureau of the Permanent Committee of the Chinese Communistic Party (CCP), Secretary of the CCP's Central Committee, Mr. He Gosyan, the parties held discussions on increase of export volumes of natural gas to China and construction of additional gas pipeline for such purposes. There are special reasons for interest of China in import of Turkmen natural gas as well. First of all, this is dictated by Turkmenistan's abundant natural gas reserves, as well as huge natural gas production and export capabilities. On the other hand, on the international arena Turkmenistan is perceived as reliable and stable partner-country, ensuring performance of its responsibilities. The abovementioned capabilities and capacities of Turkmenistan are favorable not only for China, but also for other countries displaying interest in developing cooperation with the country. Current development of Chinese natural gas market would directly affect increasing interest in Turkmen natural gas. Last year Chinese natural gas market have increase by 9,4%, equaling to 88,7 BCM. In accordance with estimated of the IEA, the Chinese natural gas market in 2030 would require 242 BCM of natural gas annually, while only 51% of these volumes would be produced domestically. In other words, in 20 years China would require to export at least 117 BCM of natural gas from foreign markets. Considering that in near future the half of Chinese consumed natural gas would be imported from foreign markets, it becomes evident that 40 BCM of natural gas exported annually from Turkmenistan would play a considerable role in energy security of the country.

Following its current strategy of diversification of energy markets, Turkmenistan also exports natural gas to Iran. Currently Petroleum Minister of Islamic Republic of Iran (IRI), Mr. Seyed Masud Mirkazemini and Deputy Petroleum Minister, Acting Director of the State Gas Company, Mr. Jawad Oujini has visited the country with the official visit. During the visit the State Concern "Turkmengas" and IRI State Gas Company have concluded an Additional Agreement to the existing Natural Gas Export Contract. In accordance with the concluded document, additional volumes of natural gas would be exported to Iranian consumers through the newly-commissioned Dowletabad-Sarahs-Hangeran second export pipeline. Continuous, as well as rapid development of the Iranian natural gas market, explains increasing interest of Iran in export of Turkmen natural gas. Being the third largest natural gas market in the world, only during the last year market increased by 10,7%, equaling to 131,7 BCM of natural gas, while in 2000 countries natural gas market was only 62 BCM. Increase of natural gas volumes exported from Turkmenistan to Iran has also been discussed during the meeting. In accordance with negotiations, if earlier Turkmenistan exported to Iran 8 BCM of natural gas annually from Korpedje field, now with considerations of Dowletabad field, this export volume would increase up to 14 BCM, while in future this volume would increase to 20 BCM of natural gas.

India, currently developing at rapid phases, is responsible for 5.1 percent of annual global GDP. In accordance with the information of the International Monetary Fund (IMF), if last year India's development rate was equal to 5,7%, then this year India expected 8,8% of increase. Energy resources, specifically natural gas resources, would be very essential for such rapidly developing economy. One of the largest energy consumption market in the world, Indian market is expected to grow at 2,2% rate until 2035 and is expected to equal 5% of worldwide energy market by that time. Thus, by 2035 Indian market would be third largest, while Chinese and US market being the largest. In next 20-25 years India is expected to be the country with the largest population, third largest economic and energy market, and thus, the country's interest in import of Turkmen natural gas would have considerable reasons.

As has been mentioned in Indian program "India Hydrocarbon Vision -2025", if in 1997 the share of natural gas in the country's consumed energy resources was 7%, then by 2025 the share is expected to increase to 20%, while by 2030 the share is estimated to equal to 25%. And if we consider the fact that by that time Indian energy market would grow considerably and at rapid pace, we could clearly see the importance of natural gas to India. In short, while in 1997 India's consumption of natural gas was 23 BCM, in accordance with "BP Sta¬tis¬tical Review of World Ener¬gy-2010" information, last year this indicator rose to 25,9%, making up 51,9 BCM. In accordance with estimates of the IEA, Indian natural gas market would equal to 113 BCM, while in 2030 increase to 132 BCM of natural gas annually.

Indian natural gas resources is estimated at total of 1,12 TCM. Last year the country produced total of 39,3 BCM . In case of maintenance of such production rates in following years, and non-exploration of new resources, the country would run out of its natural gas resources in 28 years. And in accordance with the IEA estimates, India possesses capabilities to produce 73 BCM of natural gas in 2025 and increase this volume to 80 BCM by 2030.

As becomes evident from the above data, it is expected that India would import 18 BCM in 2015, 40 BCM in 2025, and 52 BCM of natural gas in 2030. Currently, main volumes of natural gas to India are exported by Qatar (8,25 BCM) and Australia (1,12 BCM). And if considering such volumes are supplied in the form of LNG by tankers, in case of implementation of TAPI project, such pipeline would become the first transnational gas pipeline in the country. Turkmenistan-China pipeline, supplying Turkmen natural gas to China is also has been know to be the first Chinese transnational pipeline project.

It is evident that European countries also display interest in Turkmen natural gas. If due to the global economic crisis, EU's last year consumed natural gas volumes decreased by 5,9%, making up 459,9 BCM, then by 2030 Union's natural gas consumption rate is expected to equal to 619 BCM. While considering that EU's production capacity by that time would equal to estimate of 100 BCM annually, it becomes very evident that in near 20 years the volume of natural gas imported by the Union would equal to nearly 500 BCM. Turkmenistan on the other hand is interested in projects aiming at transit of natural gas to European markets. Recently during the press-conference held after the Meeting of Turkic States Leaders in Istanbul, statement of the Esteemed President of Turkmenistan mentioned that Turkmenistan has all resources to implement proposals designed for export of natural gas to all direction, including transit of natural gas through "Nabucco" pipeline.

As could be seen from the above, Turkmenistan would in near future be able to strengthen its status of the main gas export country. Thus, initiated development programs, initiated in the epoch of Great Revival by the Esteemed President of Turkmenistan, are being implemented not only for the benefits of the country, but moreover to the benefits of the people of the world.

Döwran ORAZGYLYJOW is Chief Editor, "Turkmen Weekly Energy Review (TWER). Author, "Direct Foreign Investments Joint Ventures", (Izmir, Turkey), 2005.