Thursday, 26 May 2011

Turkmen gas field confirmed as world's second-largest

It's official. Turkmenistan's enormous South Yolotan gas field, which caused a flurry of excitement (and not a little scepticism) back in 2009, has been confirmed as the world's second-largest. The UK firm Gaffney Cline, which provided the initial heady estimate of between 4 and 14 trillion cubic metres (tcm), has announced that the field is actually estimated to contain up to 20 tcm. This would make it second-largest in the world, behind the South Pars/North field, shared by Iran and Qatar.

The announcement isn't exactly a game-changer, as it's been known for some time that South Yolotan was a very significant find. But it does confirm that not all of the extravagant figures thrown out by officials in Ashgabat are exaggerations. Turkmenistan is unequivocally at the top table of natural gas states now. Markets and policymakers will have to continue upping their game in dealing with the regime of President Berdymukhammedov - as challenging as that may be.

The announcement by Gaffney Cline coincided with the opening of the country's Second International Gas Congress and Exhibition, at which President Berdymukhammedov announced (with characteristic restraint) “In the epoch of new Revival and great reforms Turkmenistan takes specific steps to diversify pipeline infrastructure to ensure reliable, stable and long-term transit of energy to world markets".

Gas exports to Europe were specifically mentioned, although Nabucco was not (unsurprisingly, given the myriad problems it currently faces). Ashgabat has made plain recently that it does want to sell to Europe one way or another, as well as upholding its burgeoning commitments to China, South Asia, and Iran.

The confirmation of South Yolotan's size means that Turkmenistan can actually begin delivering on all these promises. Which will provide a handy source of income to maintain the government's architectural ambitions.

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