Turkmenistan is on the verge of starting natural gas exports to Turkey, and subsequently Europe, via the expanded Trans Anatolian Natural Gas Pipeline Project (TANAP), according to Turkish President Recep Tayyip Erdogan.

Turkey’s Botas Petroleum Pipeline and Azerbaijan’s Socar have signed contracts to advance an intergovernmental agreement from May focused on cooperation in natural gas. One of the five contracts finalized in Baku this week involves Botas and Socar jointly organising the delivery of natural gas from Turkmenistan to Azerbaijan, and further through Turkey to other countries, according to Socar.

Among the former Soviet Union countries, Turkmenistan ranks second only to Russia in terms of gas reserves. The country possesses the technical capacity to deliver gas to Europe through an extensive network of legacy pipelines running through Kazakhstan, Russia, Belarus, and Ukraine. Additionally, Turkmenistan can export gas to neighbouring Iran via two direct pipelines, although shipments have been erratic in recent years.

Turkmenistan has been seeking an export route to Europe, especially after the decline in Russian pipeline flows to the EU. The country has been in negotiations for gas exports to Turkey and global markets through swap deals, focusing on electricity supply to Afghanistan.

Turkmenistan’s primary export market is China, facilitated by three export pipelines running through Kazakhstan. A fourth pipeline is currently in the design phase. Trade turnover between Ashgabat and China in the first quarter of 2024 totalled nearly $2.6 billion. Turkmenistan contributed approximately 92 per cent of this amount, or $2.39 billion, through natural gas sales to Beijing. In contrast, all other Central Asian states are experiencing significant deficits in their bilateral trade with China.

Earlier this year, Turkey’s Energy Minister Bayraktar announced that Turkey would initially receive up to 2 billion cubic meters of Turkmen gas under the memorandum of understanding signed in March.

In a speech at an oil and gas industry event in Baku, Azerbaijan, Turkey’s president Erdogan said, “Our long-standing cooperation, crowned with infrastructure investments such as Baku-Tbilisi-Ceyhan, Baku-Tbilisi-Erzurum pipelines, and TANAP, has not only benefited Türkiye and Azerbaijan but has also made significant contributions to the energy security of the region and Europe.”

Currently, China is Turkmenistan’s primary export market, supported by three export lines through Kazakhstan, with a fourth line in the design phase. Turkmenistan can also supply gas to neighbouring Iran via two direct pipelines, though these shipments have been inconsistent in recent years.

Industry observers in Baku expect Socar to begin talks with Turkmenistan to reinstate gas swap supplies to Azerbaijan via Iran, which were halted last year. According to reports, a swap arrangement will likely be limited to 2 billion cubic meters of Turkmen gas per year. To exceed this limit, a 300-kilometre subsea pipeline across the Caspian Sea from Turkmenistan to Azerbaijan will need to be constructed, allowing Turkmen gas to be transported to Europe via the Southern Gas Corridor pipeline network.

Earlier in April it was announced that Turkmenistan is modernising its facilities for receiving, storing, and shipping liquefied gas produced by the “Turkmengaz” State Concern according to Deputy Prime Minister Batyr Amanov at a Cabinet of Ministers meeting.

To ensure a consistent supply of petroleum products, the state concern is undertaking measures to reconstruct the relevant facilities. Enhancing these facilities with suitable material and technical resources will improve the efficiency of their production activities.