Projects
How Much Can Central Asia Compensate Gazprom for the Lost European Market?
Tashkent Wants More Russian Gas
The major contracts for the supply of Russian gas to Central Asia, announced earlier this year and expected to be signed during the St. Petersburg International Economic Forum (SPIEF) in June, have ultimately resulted in the extension of an expanded agreement with Uzbekistan and a contract for the supply of 340 mln cubic meters of gas annually from Russia to Kyrgyzstan's thermal power plants.
On June 7, 2024, in St. Petersburg, Sanzhar Zharkeshov, the head of the national company QazaqGaz, and Alexey Miller, the Chairman of the Management Board of Gazprom, signed long-term agreements for the transportation of Russian gas through Kazakhstan to Uzbekistan and Kyrgyzstan. The agreements are valid from 2025 to 2040.
According to the Russian company's press service, the documents refer to the expansion of a dedicated route based on the Central Asia-Center gas pipeline system and the implementation of other projects to develop gas transportation capacity in Kazakhstan. In the spring, QazaqGaz management stated that the agreement under development would also provide for gas import from Russia.
Earlier, the First Deputy Prime Minister of Kazakhstan, Roman Sklyar, and Alexey Miller also signed a roadmap for preparing the Central Asia-Center IV gas pipeline, which will increase the transportation of Russian gas to Uzbekistan.
Gas supplies from Russia to Uzbekistan began in October 2023 (see "The Pivot of Gas Lines," Petroleum, No. 5-2023). The sales contract between UzGasTrade and Gazprom Export, calculated for two years, initially provided for the supply of 9 mln cubic meters per day (about 2.8 bln cubic meters of gas per year). Under the new contract, the supply volumes increased to 11 bln cubic meters.
Simultaneously, at SPIEF-2024, Gazprom Export signed a contract valid until 2040 with Gazprom Kyrgyzstan for gas supplies to northern and southern Kyrgyzstan. Gazprom Kyrgyzstan, in turn, will supply these volumes to Electric Stations JSC and Bishkekteploenergo Company in the long term.
Although during his speech at the forum, Russian President Vladimir Putin stated that Russia would supply gas to the northern regions of Kazakhstan, as it would be cheaper for the country to purchase "blue fuel" from the Russian Federation than to "lay new routes there, which would cost billions," no specific documents on this matter were signed.
Moreover, a month later, on July 16, Kazakhstan's Minister of Energy, Almasadam Satkaliyev, announced after a government meeting that the decision on gasification of the northern and northeastern regions of the country had been postponed to the end of 2024. "The feasibility study is expected to be completed in November, and a corresponding decision will be made based on the results. If the decision on gasification using Russian sources is not made, then a scenario involving the expansion of the Saryarka gas pipeline will be adopted," the minister stated.