Chinese leader Hu Jintao will mark a new milestone in Beijing’s quest for control over Central Asia’s energy resources when he inaugurates a new gas pipeline from Turkmenistan next week.

China has already stepped up its presence in the region by handing out
billions of dollars in loans, snapping up energy assets and building an
oil pipeline from Kazakhstan.

The new pipeline will add natural gas to the resources China buys from
the region, which was for decades dominated by Russia but is now also
close to the West.

Hu will visit Kazakhstan and Turkmenistan from Saturday to Monday, and
in Turkmenistan he will attend the formal opening of a gas pipeline
connecting China to Central Asia, Chinese Vice Foreign Minister Wang
Guangya told a news conference in Beijing.

Another official at the briefing said China was open to other energy
projects in central Asia, where the former Soviet states have been
looking beyond Russia for fresh markets.

“In the energy sector, China is pursuing diversification of energy
imports, while the Central Asian countries are pursuing diversification
of exports,” said Zhang Xiyun, director-general of the Chinese foreign
ministry’s department for European-Central Asian affairs.

“This kind of cooperation will naturally continue and has room to
develop further,” said Zhang, who mentioned Central Asian reserves of
oil, natural gas and uranium.

COMPETING WITH GAZPROM

The 1,833-kilometre (1,139-mile) Turkmenistan-China pipeline also
stretches through Uzbekistan and Kazakhstan into western China’s
restive Xinjiang region. It starts close to a gas field developed by
China’s CNPC.

With capacity of 40 billion cubic metres (bcm) a year, it will ease
Turkmenistan’s dependence on Russia, which purchases about 50 bcm a
year.

Russia’s Gazprom stopped buying Turkmen gas in April due to a pricing
dispute in a move that has cost Turkmenistan an estimated $1 billion a
month. The two sides have yet to agree on new supply terms.

China has helped Turkmenistan partially offset the losses by giving it
a $3 billion loan to develop the South Iolotan field, one of the
world’s five largest natural gas deposits.

Beijing has also given $10 billion in loans to Kazakhstan this year,
securing a stake in Kazakh oil producer MangistauMunaiGas in return.

China already receives Kazakh oil by pipeline and continued to increase
its share of its production through acquisitions this year, including
purchase of an 11 percent stake in state-controlled KazMunaiGas EP for
$939 million.

It also entered the booming Kazakh uranium sector in April, when China
Guandong Nuclear Power Co (CGNPC) and Kazakh state nuclear firm
Kazatomprom announced plans to lift uranium output from their joint
venture.

“China, unlike many other economies, is growing and will continue to
grow,” Kazakh central bank chairman Grigory Marchenko said at a
briefing on Thursday.

“They need resources for that. Geographically, it is easiest and
cheapest to get those resources in Kazakhstan. Our geography is our
destiny.”

Source: Reuters

Search to find what you want

• Nearly 1.9 million tonnes of Kazakh oil via BTC pipeline carried out, including 187,000 tonnes in October

    Tendency of increase of Kazakh oil transportation via Baku-Tbilisi-Ceyhan (BTC) resumed this October after its growth in August and fall between March and July, and in September that followed the February’s record indicator. Transportation of Kazakh oil was started in October 2008. The Azerbaijani State Statistics Committee (SSC) informs that

• Azerbaijan, Kazakhstan at the opening of the new oil pipeline to the West

    Kazakhstan, which plans to double oil production in the next decade, is in talks with Caspian Sea neighbour Azerbaijan to find new routes for delivering its extra crude volumes to the Black Sea and beyond. The ex-Soviet republics are considering various options, including construction of a new pipeline, to add to the

• KazMunayGas and SOCAR into account the construction of new oil pipeline, Baku-Black Sea

    Kazakh National Company KazMunayGas (KMG) and  State  Oil  Company  of  Azerbaijan  (SOCAR)  have  signed  a memorandum  of  intent on cooperation in the Baku-Black Sea oil pipeline project, Interfax reports.  The  document was signed in Baku on Friday, KMG and SOCAR said in a joint press release.     “The memorandum of intent on cooperation

• China Natural Gas Power rises by 7.7% in 2009

    One of the world’s leading energy consumers, China’s natural gas output rose by 7.7 percent last year, it was still not enough for ever rising domestic demand.

• Israel interested in pumping Azeri oil through Eilat Ashkelon Pipeline

    Israeli Ambassador transportation of Azerbaijani oil through the Ashkelon-Eilat pipeline ‘is economically profitable’. The Ambassador Michael Lavon-Lotem said: “Experts say the project is economically profitable as an alternative route of oil transportation to the Far East market.

• Italy, Russia, Turkey sign pipeline deal

    Italy, Russia and Turkey signed an agreement Monday for the construction of a pipeline that will carry crude oil from the Black Sea to the Mediterranean port of Ceyahn, the Italian oil company Eni said in a statement. The Samsun-Ceyhan project “underlines (a) joint commitment to enhance energy security,” Eni

• Chevron Kazakh venture to raise oil output

    Kazakhstan’s largest oil producer, Chevron-led venture Tengizchevroil, will produce 22.5 million tonnes of oil this year, up from 17.3 million tonnes in 2008, a senior Kazakh official said on Monday. “Tengizchevroil is expected to increase planned output from 21.5 million tonnes to 22.5 million tonnes,” Deputy Energy Minister Duisenbai Turganov told a

• CNPC eyes 70 million T Central Asian oil and gas in 5-8 years

    State-owned China National Petroleum Corp (CNPC) aims to get 70 million tonnes of oil equivalent per year from central Asia within 5 to 8 years, a company newspaper reported on Friday. The parent of PetroChina (0857.HK: Quote, Profile, Research)(601857.SS: Quote, Profile, Research) plans to obtain 20 million tonnes of crude

• Ceyhan terminal thousandths of tankers with crude oil supplied by BTC

    The Turkish Ceyhan terminal began loading 1,000 oil tankers under the export of oil via the Baku-Tbilisi-Ceyhan (BTC) pipeline, BP (operator of the pipeline) reported.

• Kazakhstan set to export grain to China

    Kazakhstan, one of the world’s top 10 grain exporters, intends to supply grain to China to compensate for poor sales in traditional markets, the agriculture minister said on Tuesday. The Central Asian republic gathered 22.7 million metric tons of grain in bunker weight in 2009, one of the best harvests in

• Kazakhstan set to export grain to China

    Kazakhstan, one of the world’s top 10 grain exporters, intends to supply grain to China to compensate for poor sales in traditional markets, the agriculture minister said on Tuesday. The Central Asian republic gathered 22.7 million metric tons of grain in bunker weight in 2009, one of the best harvests in

• Caspian CPC oil exports fall 4.1 percent vs. August July

    Kazakh and Russian oil exports via the Caspian Pipeline Consortium (CPC) fell 4.1 percent to 716,130 barrels per day (bpd) in August from 746,614 bpd in July, CPC said on its website. The consortium transported 22,200,030 barrels of CPC Blend CPC-Ein August versus 23,145,022 barrels in July. The pipeline group is

• Storage loss Hamper China gas import Goals

    China is stepping up imports of natural gas to meet a surge in demand and to reduce pollution levels, but it may be hampered by a lack of sufficient storage facilities. The country’s supply-demand gap for natural gas is expected to reach 30 billion cubic meters this year, the General

• Gunvor sold Russia Baltic Oil Terminal Transneft

    Switzerland-based oil trader Gunvor has sold a crude oil terminal under construction in the Russian Baltic Sea port of Ust Luga to Russia’s oil pipeline monopoly Transneft, it said on Tuesday. A Gunvor spokesman told Reuters the company had decided to sell the business but remained the owner of the existing

• Nord Stream to Supply UK by the year 2012

    The United Kingdom contracted gas purchases from the Russian-backed Nord Stream pipeline to meet more than 4 percent of its demand by 2012, officials said. Russia aims to diversify its energy transport options through the Nord Stream pipeline through the Baltic Sea and the South Stream pipeline to southern Europe.