Oil Report

Russian company wins Turkmen China pipeline tender

ASHGABAT, Feb 19 (Reuters) - A top Russian engineering company has won a tender to built a segment of a new natural gas pipeline that will take Turkmenistan’s gas to China while bypassing Russia, the government and the company said.

The pipeline, with an annual capacity of up to 40 billion cubic metres and due to be constructed by 2009, starts in the east of Turkmenistan on the gas-rich right bank of the Amu Darya river and will pass through Uzbekistan and Kazakhstan.

A Turkmen government official told Reuters that Stroytransgaz, which lists gas monopoly Gazprom GAZP.MM among its top clients, had won a tender to build the 190-km Turkmen part of the 7,000 km (4,350 miles) pipeline.

“More than 10 firms took part in the tender. Stroytransgaz was announced the winner,” the government official said late on Monday.

The Russian company’s top management team was in the Turkmen capital Ashgabat on Monday and met Turkmen leader Kurbanguly Berdymukhamedov, who came to power more than a year ago and vowed to open up the desert nation to foreign investment.

Stroytransgaz President Victor Lorents was quoted as saying by the Turkmen state news agency as saying he wanted to expand his company’s presence in Turkmenistan.

The Turkmen leader in response listed building gas storage facilities and utilising associated gas at deposits as potential projects, the agency reported.

Central Asia’s top gas producers, Kazakhstan and Turkmenistan, currently use a pipeline network operated by Gazprom to sell their gas internationally.

While seeking to maintain good relations with Moscow, their former Soviet overlord, the Caspian nations are exploring alternative routes to export their products to Europe and China.

Energy-hungry China sees the new Turkmen gas pipeline, as well as a separate oil pipeline linking it with Kazakhstan, as a step towards entrenching itself in Central Asia where most exports are still channelled west to Europe.

Writing by Maria Golovnina; editing by Neil Fullick