U.S. EXIM BANK TO FUND LARGE-SCALE TURKMEN PROJECTS. U.S.

Export-Import Bank President James Harmon announced yesterday in Ashgabat that the bank is prepared to lend Turkmenistan US$2 billion to US$3 billion for various projects, mainly in the oil and gas sector. The offer expresses the U.S. interest in the development of Caspian mineral resources and their export to international markets, Harmon said. His talks in Ashgabat focused on the project to lay a trans-Caspian pipeline which would bring Turkmen gas to Azerbaijan and from there to Turkey and to Europe. Harmon made clear that the project would go ahead even if Moscow decides to allow the transit of Turkmen gas to Europe via Russia. He indicated that the potential export volumes of Turkmen gas are so large as to ensure the project’s commercial attractiveness.

This latter remark is important in terms of allaying a concern expressed by some potential investors and leading gas companies. They have hypothesized that Moscow might, at a moment of its own choice, suddenly lift the blockade it has imposed on the transit of Turkmen gas to Europe via Russia. Such a move could reduce the amounts of gas routed via Azerbaijan and Turkey, thereby reducing the profitability of the planned pipeline. This consideration, however, can also act a spur to faster development of Turkmen gas deposits.–VS

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