CNPC Signs Gas Contract With Turkmenistan

June 2007 | Ratings Update

A pipeline deal with Russia, reached in May, may seem like a set-back for hopes of greater diversification of Turkmenistan's gas exports. However, we do not believe that this is indicative of an isolationist trade policy pursued by President Kurbanguly Berdymukhamedov, as we continue to see a sustained interest in the completion of a China-bound pipeline. Moreover, we do not believe that talks for a trans-Caspian pipeline are completely off the table in the long term. The new pipeline is set to have an initial capacity to transport 10bn cubic meters (bcm) of natural gas per year by 2009-2010.

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