Europe’s Wait for Turkmen Natural Gas Continues

In response to the Kremlin’s war on Ukraine, the European Union is moving to wean itself off Russian natural gas. While the move makes sound geopolitical sense, cutting off Russian gas supplies has already caused economic pain. Before the war, Russia supplied 40 percent of Europe’s gas. The European Union now aims to achieve energy independence from Russia by 2030. Moscow has retaliated by restricting gas flows to Europe and even shutting down the crucial Nord Stream 1 pipeline, sending energy prices soaring. The European Union is now desperately searching for new sources of natural gas. Turkmenistan, with the world’s fourth largest gas reserves, would seem to be a possible supplier. The Central Asian country has been experiencing an economic crisis for some seven years and needs customers for its natural gas. But there is still no physical connection between Europe and Turkmenistan to ship the crucial commodity, and Turkmenistan’s repressive government has a poor human rights record. More importantly, Turkmenistan seems intent on privileging its ties with Russia and Iran over any potential market opportunities in Europe. As a result, there is no sign of urgency from Turkmenistan to export any of its gas to Europe anytime soon. The Long Saga of Getting Turkmen Gas to Europe The idea of bringing gas from Turkmenistan is not new. The proposal for a Trans-Caspian Pipeline dates to the mid-1990s. The European Union included Turkmenistan in its plans for a Southern Gas Corridor, part of which is already functioning, to transport gas from Azerbaijan’s Shah Deniz II field in the Caspian Sea across Turkey to the Trans-Adriatic Pipeline that supplies gas to Greece, Albania, and Italy. The plan was for Turkmenistan to supply some 30 billion cubic meters (bcm) of gas annually, via a pipeline that ran along the bottom of the Caspian Sea to Azerbaijan, where it would be fed into the pipeline network leading through the Caucasus to Turkey. From there, the gas would be exported to Europe. In 2021, the European Union imported some 155 bcm of gas from Russia, which was 39.2 percent of EU gas imports. Russia has the world’s largest proven gas reserves with 37.4 trillion cubic meters (tcm), Turkmenistan has 13.6 tcm (according to some sources 19 tcm), and Azerbaijan 2.3 tcm. Turkmenistan has enough gas to somewhat offset the loss of Russian gas to the European Union, but Turkmen gas needs to reach the west side of the Caspian Sea first—and this has been the major problem. Russia and Iran have continually opposed the construction of the Trans-Caspian Pipeline. Both countries cite environmental concerns, but some believe this rationale masks commercial concerns. The Kremlin, naturally, did not want Turkmenistan cutting into Russia’s share of the European gas market. Iran was similarly blocking what could be a competitor’s project should the time come when international sanctions on Tehran for its nuclear program were lifted. With the world’s second-largest gas reserves (32.1 tcm), Iran would be able to export to Europe via a much easier land route. When the leaders of the Caspian littoral states met in Aktau, Kazakhstan, in August 2018, they signed the Convention on the Legal Status of the Caspian Sea. It should have cleared up obstacles to the construction of the Trans-Caspian Pipeline, but it did not. The convention states: This language gives Russia and Iran a say on environmental standards and requirements for the construction of a pipeline between Turkmenistan and Azerbaijan. As a result, the convention did little to change the status quo that existed before the signing of the document. Recent signs indicate Turkmenistan does not intend to press that point. Turkmen-Russian Ties Stay Close On March 12, 2022, Serdar Berdymukhammedov was elected Turkmenistan’s president, taking over from his father Gurbanguly Berdymukhamedov, who had held the same position since 2007. Serdar’s first official trip as president was to Russia on June 10. Russian President Vladimir Putin had already awarded Serdar the Order of Friendship in May for his “great contribution to strengthening the strategic partnership between the Russian Federation and Turkmenistan.” When the Turkmen and Russian presidents met in Moscow in June, Putin said, “Russia and Turkmenistan attach great importance to joint work with the Caspian states in the field of security, economic partnership, conservation of natural resources and maintenance of environmental well-being.” Putin’s choice of words indicates that Russia’s opposition to the trans-Caspian pipeline for ostensibly environmental reasons.