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Last Updated: Saturday, 12 May 2007, 10:29 GMT 11:29 UK
Russia clinches gas pipeline deal
Map showing region of Caspian gas pipeline
Russia, Turkmenistan and Kazakhstan have agreed to build a new natural gas pipeline north from the Caspian Sea.

Russia's President Vladimir Putin announced the deal at a summit with Central Asian leaders in Turkmenistan.

The agreement ensures Russia's access to Turkmenistan's gas, and is a setback to rival US and European Union plans.

They had hoped to pipe Turkmen gas across the Caspian sea via Turkey, in order to reduce the EU's dependence on Russian-controlled energy.

Following two days of negotiations the presidents of the three countries, meeting in the Turkmen port city of Turkmenbashi, announced they would sign a treaty on the planned pipeline by September.

President Putin said the deal would mean increased energy supplies to Europe.

'Huge blow'

The new pipeline will carry gas from Turkmenistan, one of the world's largest sources of gas, through Kazakhstan to Russia.

"We will reconstruct the Caspian shore gas pipeline with a capacity of 10 billion cubic metres (per year) and build a parallel gas pipeline." Mr Putin said.

We will reconstruct the Caspian shore gas pipeline with a capacity of 10 billion cubic metres (per year) and build a parallel gas pipeline
Vladimir Putin

The deal represents a victory for Russia, which buys Turkmen gas at below-market prices.

The BBC's Natalia Antelava says the agreement is a huge blow to Washington, Brussels and Beijing, who have all been vying for direct access to Turkmenistan's gas.

They have lobbied strongly for a route under the Caspian Sea to Azerbaijan and Turkey, bypassing Russia.

Turkmenistan's massive gas reserves are effectively controlled by Moscow, since it relies on Russian energy giant Gazprom's Soviet-era pipelines for distribution.

For two decades, the isolationist policy of Turkmenistan's late leader Saparmurat Niyazov made additional access impossible.

But his death last year opened a window of opportunity and it was hoped that new President Kurbanguly Berdymukhamedov would give the go-ahead to a trans-Caspian pipeline that would ease Europe's dependence on Kremlin-controlled energy.


Why the deal is so significant

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12 May 07 |  Asia-Pacific
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09 May 07 |  Asia-Pacific
Country profile: Turkmenistan
14 Feb 07 |  Country profiles
Country profile: Russia
23 Apr 07 |  Country profiles
EU dreams of Central Asian gas
27 Mar 07 |  Europe

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