LNG

Gazprom, the Russian natural gas company impacted by sanctions after the invasion of Ukraine in 2022, is trying to rebuild its business by signing deals for gas transportation exits via the three Central Asian former Soviet states of Kazakhstan, Uzbekistan and Kyrgyzstan as well as its neighbour across the Black Sea, Turkey.

Gazprom has just signed contracts with Kazakhstan for gas transit to Uzbekistan and Kyrgyzstan.

The documents were signed at the St. Petersburg International Economic Forum held by the Russians.

Gazprom has ambitious plans to ramp up gas supplies to Central Asia and Turkey.

The company aims to deliver significantly larger volumes via the Central Asia-China Pipeline for 15 years starting in 2025. 

The Central Asia-China pipeline is a network of natural gas pipelines that transport natural gas from Turkmenistan, Kazakhstan, and Uzbekistan into China.

With a 55 billion cubic metres capacity, the same as the now defunct Nord Stream 1 pipeline from Russia to Germany, the 1,833-kilometres (1,140 miles) Central Asia-China Pipeline presently comprises three sections (Lines A, B, and C), running from Turkmenistan through Uzbekistan and Kazakhstan to China’s Uygur Xinjiang Autonomous Region.

From there, the pipeline links up with the West-to-East Gas Pipeline in China, underscoring its significance in regional energy dynamics.

Gazprom added that it had also signed a contract for the supply of gas to the north and south of Kyrgyzstan.

Larger volumes

In addition, Gazprom and Kazakhstan signed an action plan to prepare gas facilities in Central Asia to increase the transportation of Russian gas to Uzbekistan.

In June 2023, Uzbekistan concluded a two-year gas purchase agreement with Gazprom.

The daily supply volume is 9 million cubic metres and the annual volume is almost 2.8 billion cubic metres and deliveries started in October 2023.

From November 2025, Gazprom said it planned to begin supplying “significantly larger volumes” covered by 15-year contracts with Kyrgyzstan, Kazakhstan and Uzbekistan.

In February 2024, it was reported that the government of Uzbekistan intends to upgrade the republic’s main gas system in order to increase gas imports from the Russian Federation by 3.5 times from 9 million cubic metres per day to 32 mcm per day.

BOTAŞ venture

Turkish Energy Minister Alparslan Bayraktar was also at the Russian Forum and said the Turkish Petroleum Pipeline Corporation (BOTAŞ) planned to set up a joint venture company with Gazprom as part of a plan to establish a hub in Turkey for selling natural gas.

“Significant work has been done in recent years to establish a natural gas trading centre in Turkey,” said Bayraktar.

“We are now planning to establish an operating company in partnership with BOTAŞ and Gazprom in Istanbul,” he added.

“In the coming months, we would like to carry out concrete work and realise the gas hub project,” stated Bayraktar.

Russian natural gas giant Gazprom has found another outlet for its resources stranded by Western sanctions over the war with Ukraine by signing new supply deals with the Central Asian republics of Uzbekistan and Kazakhstan.

Gazprom signed an agreement with Uzbekistan to supply gas volumes and also signed an accord with Kazakhstan’s QazaqGaz to provide services for the transportation of Russian natural gas through Kazakhstan to customers in Uzbekistan while also promising more volumes to the Kazakhs.

The two-year agreement will provide 9 million cubic metres per day, or around 2.8 billion cubic metres per annum, of pipeline natural gas to Uzbekistan.

Oil focused

Uzbekistan is an oil and natural gas producer, though its output leans mostly towards oil.

The overall deal is for the transit of 6 Bcm of gas annually, which implies that other Central Asian countries may also come to import more Russian gas via this route.

The details of the natural gas supply deal were revealed on October 7 at a ceremony attended by Russian President Vladimir Putin, Uzbekistan President Shavkat Mirziyoyev and Kazakhstan President Kassym-Jomart Tokayev.

The search for new pipeline gas customers by Gazprom has continued after Western sanctions on pipeline gas to Germany and the European Union, though there were no specific sanctions on LNG and cargo deliveries continue.

The Gazprom-operated Sakhalin LNG plant in the Russian Far East lost Shell as a shareholder but Japanese shareholders remained on board as they rely on the more than 9 million tonnes per annum of deliveries to Japanese terminals.

Kazakhstan is the largest southern neighbour of Russia in Central Asia and Uzbekistan lies to the south of Kazakhstan.

There is also a Central Asian natural gas pipeline in the region that is connected to China and supply flows to the Chinese are increasing year-on-year,

China pipeline

The pipeline supplying the Chinese from the west originates on the Turkmenistan-Uzbekistan border and passes through Kazakhstan on the 3,665 kilometres (2,277 miles) route to Horgos in the Xinjiang region of China.

A statement on the Gazprom deal with Uzbekistan and Kazakhstan said that the “blue fuel” from Russia would be sent to Uzbekistan via Kazakhstan, with a share of it also going to Kazakhstan. 

“Firstly, this is an important factor in the energy security of our country and the entire region. Secondly, the supply will provide for additional volumes of gas for the uninterrupted supply to economic sectors and the population,” said the President of Uzbekistan Shavkat Mirziyoyev.

According to Mirziyoyev, the implementation of this project was a “vivid example” of successful mutually beneficial cooperation between Russia, Kazakhstan and Uzbekistan in the energy sector.

“The implementation of this project will have obvious benefits for all three countries. Uzbekistan will get an additional source of energy, allowing it to guarantee an uninterrupted supply of heat and electricity to households and socially important facilities. Kazakhstan will be able to solve the issue of gasification of its northern and eastern regions,” said Gazprom 

Sept 4 (LNGJ) - The largest privately held oil and natural gas company in the former Soviet Asian Republic of Uzbekistan, Sanoat Energetika Guruhi (Saneg), has logged a three-fold increase in gas production from fields it was given responsibility for in 2019 along with a 55 percent rise in oil production. Saneg has rights for 103 oil and gas fields and has invested US$750 million. It has identified gas deposits in 78 of the fields and with 33 now under development. 

   As a result, gas production from the properties has risen from 389 million cubic metres per annum in 2021 to 1.4 Bcm in 2022. “The main driver of growth has been a program that utilizes flare gas released in the fields during the extraction and preparation of oil. The program saves valuable gas from being burned off, as used to be the case, and instead transfers it into the gas transmission system of Uztransgaz JSC,” Saneg explained.

Air Products, the US LNG equipment-maker and industrial gases company with several mega-projects in the Middle East and Asia, has signed a deal with the Uzbekistan Government and the national gas company to acquire a gas-to-syngas facility for $1 billion in the former Soviet republic.

Chinese natural gas imports by pipeline and as liquefied natural gas increased by more than 11 percent in March, though were still lower for the first quarter compared with 2022.

Chinese liquefied natural gas imports dropped by almost 12 percent in January and February compared with the same period of 2022.

Sanoat Energetika Guruhi (SEG), an independent oil and gas company in the former Soviet Republic of Uzbekistan with customers in Germany, Poland and the UK, reported an 8 percent increase in production in the first nine months of 2022 as it aspires to boost output while meeting all global oil field standards.

China National Petroleum Corp, the country's largest oil and gas company, said it had increased efforts to import more pipeline natural gas from Central Asian countries and Russia and to connect the supplies to Chinese customers to complement LNG imports.

Chinese liquefied natural gas imports increased last month compared with the same month last year, led by shipments from Australia and Qatar, though the cargo deliveries were lower than the record set in January 2019 when winter demand was at its peak.

Chinese liquefied natural gas imports rose in August by 50 percent compared with the same month a year ago as the growth in shipments was matched by more coal-fired power use to supply electricity to the main cities during the hotter summer weather.