Ashgabat Hosts OGT 2021 International Investment Forum [Promoted]
The event was held in a hybrid format and attended by over 500 delegates, more than 200 large companies from 42 countries of the world, government agencies, relevant ministries and agencies, the world's leading oil & gas, service and consulting companies, major international organizations and financial institutions, diplomats and academia.
The plenary session discussed the global trends in energy markets and investment opportunities of Turkmenistan as one of the world's energy powers.
Secretary General of the International Energy Forum (IEF) Joseph McMonigle, Trade Envoy of the Prime Minister of Great Britain in Turkmenistan Baroness Nicholson Winterbourne, the Executive Secretary of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) Armida Salsiah Alisjahbana, President of SOCAR Rovnag Abdullayev and others presented at the forum and discussed the current state and forecasts of the development of the world energy markets.
The particular emphasis in the presentations was attached on the need to restore the world economy after the COVID-19 pandemic and the transition to environmentally friendly development, taking into account global warming, which has become a serious challenge to humanity.
Energy demand is expected to grow gradually along with the global economy and population. At the same time, the most demanded of hydrocarbon resources will be natural gas, since it is energy efficient, low-cost and environmentally friendly fuel.
The largest growth in gas demand will be provided by the electric power generation and the industrial sector - first of all, the petrochemical and gas processing industries.
At the same time, taking into account the concern of the international community with the problems associated with climate change, renewable energy sources, primarily wind and solar energy, innovations in the field of hydrogen and energy-saving technologies, digitalization of the fuel and energy complex will receive further development.
Geographically, the highest growth rates in energy consumption are expected in China and other countries in the Asia-Pacific region. Turkmenistan takes 4 place on natural gas reserves and is one of the largest producers of environmentally friendly fuel in Eurasia, significant amount of which is exported to China. In this respect, ADB country director Mr. Yu, had noted that air quality in his hometown in China has become much cleaner after China started receiving gas imports from Turkmenistan, which led to gradual reduction of coal use.
The Ambassador of China to Turkmenistan Qian Naicheng emphasized that cooperation between China and Turkmenistan in the gas sector is a clear manifestation of the mutually beneficial nature of bilateral relations.
Important agreements on further strengthening interstate partnership, including in the energy sector, were reached during a recent telephone conversation between President Gurbanguly Berdimuhamedov and President of the People's Republic of China Xi Jinping.
“China is ready to take advantage of the opportunities for comprehensive expansion of cooperation, giving it new impetus,” Qian Naicheng said.
The Forum continued with the session on the role of financial institutions in supporting the global energy agenda, which also discussed issues such as the impact of COVID-19 on investment, the achievement of the goals of the Paris Climate Agreement by oil and gas companies, and the latest trends in financing oil and gas projects.
In particular, speakers noted that interaction with international financial institutions is one of the strategic directions of the economic policy of Turkmenistan, which is designed to contribute to the successful integration of the country into the modern system of world economic relations, to attract new foreign investors. Our country has joined dozens of international conventions and treaties, including in the field of finance; representative offices of several international financial institutions operate in Ashgabat on a permanent basis.
Turkmenistan is strengthening and expanding the partnership with the International Monetary Fund and the World Bank Group. Mutual interest and desire to develop cooperation, search for mutually acceptable solutions aimed at enhancing fruitful ties have become the basis for effective joint activities of Turkmenistan and the European Union within the framework of the EU programs in Central Asia.
Turkmenistan actively cooperates with the Asian Development Bank, which supports not only national but also regional projects. For example, in the preparing terms of reference and attracting investors to the project for the construction of the Turkmenistan-Afghanistan-Pakistan-India gas pipeline. The Islamic Development Bank participates in many investment projects, both in the public and private sectors.
This topic was covered in detail during the session “Pipeline projects - the driving force behind the transition to a low-carbon future.” Representatives of the consortium “TAPI Pipeline Company Limited”, the Central Bank of the Islamic Republic of Afghanistan and the Asian Development Bank noted the great progress achieved in promoting the TAPI project.
The new energy pipeline is designed not only to ensure the supply of Turkmen gas to the largest countries of South Asia, but also to become a key factor in strengthening economic partnership, to help consolidate peace and stability in the region.
The 1,635-km pipeline will deliver up to 33 BCMA natural gas from the Galkynysh gas field in Turkmenistan to three off-take points in Afghanistan (located at Herat, Helmand and Kandahar), three offtake points in Pakistan (located at Quetta, Multan and Jahanian), and a final off-take point at the Pakistan-India border in order to supply the Indian market. The linear part of the 214-km Turkmenistan section of the TAPI pipeline has been laid down.
Practical steps are being taken to develop the production infrastructure of the Turkmenistan-China gas pipeline, which in the future will increase the volume of Turkmen gas exports to China. In January this year, a gas compressor station was put into operation at the Malay field with a capacity of 30 billion cubic meters of natural gas per year.
New fields are gradually being commissioned in the Bagtyyarlyk contract area, which is being developed by the Chinese National Petroleum Corporation, in accordance with the Production Sharing Agreement concluded in 2007.
The reports presented at the session “Offshore fields of the Caspian Sea: development experience and new investment opportunities” aroused particular interest among the forum participants.
The panelists noted that the development of hydrocarbon resources of the Turkmen sector of the Caspian Sea is one of the key aspects for the development of the oil and gas complex of Turkmenistan and attracting foreign investment. In this regard, senior vice-president of Lukoil Mr. Denis Rogachev shared the experience of Lukoil in developing fields in north Caspian Sea.
Dragon oil (Turkmenistan) Ltd, a subsidiary of Dubai-based Dragon oil, develops Jeitun and Jygalybek fields, which are part of the Cheleken contract territory. A large amount of work has also been carried out here to modernize and develop the offshore oil and gas infrastructure. In total, about 7.5 billion US dollars were allocated for these purposes.
Among the long-standing partners is Malaysia’s Petronas Charigali (Turkmenistan), which carries out exploration and production of hydrocarbons in the Block-I contract area. It has already produced more than 2.5 million tons of oil and 9.5 million tons of condensate, as well as about 27 billion cubic meters of natural gas. The company's investments at the beginning of April 2021 amount to about US $11 billion.
In addition, there are Production Sharing Agreements for a number of offshore blocks with, ENI, Buried Hill (Cyprus), ARETI (Switzerland).
The signing of a Memorandum of Understanding between the Governments of Turkmenistan and the Republic of Azerbaijan on joint exploration and development of hydrocarbon resources of the Dostluk field in the Caspian Sea in January this year has paved the way for further enhancement of mutually beneficial cooperation between two countries
“Turkmenistan inspired the world to produce sustainable fuels” said Rickard Vannby, the Global Licensing Director of Haldor Topsoe in Session 4, titled: Gas Monetization – a glance to the future. He also said: “A pioneer in the industrial production of gasoline from natural gas, Turkmenistan has inspired many countries and companies to move towards cleaner fuels. Many countries began to consider new projects for the construction of enterprises, such as the one launched in the Ahal region of Turkmenistan in June 2019”. This is the world's first plant for the production of environmentally friendly gasoline from natural gas using the TIGAS technology.
One of such projects is planned to be implemented in the American Texas in the near future, and it was the example of Turkmenistan that inspired the governments to work in this direction, the representative of Haldor Topsoe said.
According to state officials, the new plant will offer 225 million American drivers a climate-friendly fuel that will reduce carbon emissions by 50% without increasing its production costs over regular gasoline.
In addition, Rickard Vannby shared the official forecasts of the US government, according to which gasoline will still remain the main fuel for cars until at least 2050.
Within the framework of the international forum, a number of contracts were signed with foreign companies, including for the purchase of large consignments of hydrotreated diesel fuel, aviation kerosene, calcined petroleum coke and other products of the Turkmenbashi complex of oil refineries.
Senior management of the energy and financial sectors of Turkmenistan held meetings with IOC representatives, during which they discussed promising areas of cooperation and specific projects. Next OGT conference in Ashgabat is scheduled for 27-28 October, registration will open in July.
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