TURKMENBASHI IS PULLING A GAS PIPELINE FROM CHINA

Saparmurat Niyazov hopes to sign gas contracts with China. The Turkmenbashi will also try to persuade Chairman Hu Jintao to finance construction of a gas pipeline connecting Turkmenistan and China directly (and bypassing Russia).

Niyazov brought a new portfolio of gas offers with him. He said on the eve of the visit that Turkmenistan is prepared to sell China up to 40 billion cubic meters of gas from the right-hand bank of the Amudarja at $80. As a matter of fact, these gas fields are mostly undeveloped at this point but the Turkmenistan believes he knows the solution to the problem. He wants a loan at 3% for the 20-25 years from China so as to buy drilling equipment from Beijing.

Last but not the least, the Turkmenbashi intends to suggest construction of a direct pipeline connecting Turkmenistan and China. Official Ashkhabad is convinced that the construction should be sponsored by Beijing alone. CINOPEC General Director Van Dunjin and Xian Gobao, Assistant Chairman of the State Committee for Reforms, visited Ashkhabad this January, and the Turkmenbashi said, "China is a great country. It could build the pipeline in three years. Let China build the pipeline, and we will provide gas here on the border."

The negotiations in Beijing promise to be difficult. "We do not always reach decisions. There are moot points, you know. And yet, we will reach the decisions in the near future - either in joint ventures or in the split of end product," Niyazov said before departing Ashkhabad. Spokesmen for the government of China have already expressed the readiness to loan 650 million yuans ($82 million) to Turkmenistan.

It may be added that Niyazov's visit to Beijing comes in the wake of the visit of Vladimir Putin during which Russian-Chinese fuel contracts worth billions were signed. In the meantime, what the Turkmenbashi offers is not any inferior in scope to the gas accords Aleksei Miller of Gazprom signed in Beijing on March 21. There is apparently more to Beijing's eagerness for CIS gas than the needs of its rapidly developing national economy. China's direct access to Central Asian gas (the Kazakh authorities also aspire for a direct gas pipeline to China) will bind this part of the post-Soviet zone ever more closer to China. Central Asian states in their turn will have an alternative route for energy resources export and that will lessen their dependance on Russian pipelines and on Moscow in general. As for Beijing itself, it will diversify its energy sources and also lessen gas dependance on Russia that will become inevitable once new gas pipelines from Siberia have been built. In this case, Beijing will always have the last say in the Russian-Chinese geopolitical alliance that is taking shape.