November 18, 2009 / 12:15 PM / 10 years ago

Chevron in talks with Turkmenistan over gas field

* Chevron says interested in key Turkmen gas deposit

* U.S. urges Turkmenistan to let foreigners invest onshore

By Marat Gurt

ASHGABAT, Nov 18 (Reuters) - U.S. oil major Chevron Corp (CVX.N) is in talks with Turkmenistan over its possible participation in developing the giant South Iolotan gas field, the company’s country head said on Wednesday.

Washington has urged the Caspian nation to allow U.S. companies to invest in its lucrative onshore projects but Turkmenistan has so far admitted only China’s CNPC.

Turkmenistan, an isolated country north of Iran, is at the heart of a geopolitical struggle between the United States, Russia and China for access to its resources, notably its abundant gas.

South Iolotan contains between 4 trillion and 14 trillion cubic metres of gas, according to Britain’s Gaffney, Cline and Associates, making it one of the world’s five largest deposits. Douglas Uchikura, head of Chevron Nebitgaz B.V. Turkmenistan, told Reuters on the sidelines of an annual energy conference that he was in talks with Turkmen officials on the project. “Yes, we are interested,” he said. “We are making proposals and we are in discussions”.

Speaking to Reuters on the eve of the conference, U.S. Deputy Assistant Secretary of State George Krol said Washington wanted Turkmenistan to allow its companies to invest in onshore deposits such as South Iolotan. [ID:nLH368174]

Irritating other regional players, Turkmenistan has allowed only China’s state-owned major China National Petroleum Corp (CNPC) to invest onshore in a gas project linked to a Turkmenistan-China gas pipeline due to open next month.

Pushing into thinly populated Central Asia to feed China’s energy needs, CNPC won a licence to develop the onshore Bagtyyarlyk deposit two years ago.

South Iolotan, another key onshore project, is seen as a potential gas suppliers for the EU-backed Nabucco pipeline designed to ease Europe’s dependence on Russian gas by connecting Caspian gas with Western markets.

Turkmen officials could not be reached for comment on Chevron talks or whether they were holding similar discussions with other companies. (Writing by Maria Golovnina, editing by Anthony Barker)

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