Chronicles 2017: Oil and gas complex

The chairing of Turkmenistan at the Energy Charter Conference was remarkable event of the last year. 

Ashgabat forum “Toward International Framework Agreement of Transit of Energy Carriers” was held in on May 30 – 31. This representative meeting was an open platform for continuation of constructive dialog between all interested parties in such strategic direction as the formation of new model of global energy security, which is an integral factor of the achievement of the Goals of Sustainable Development announced by the United Nations. 

More than 80 participants including ministries, high government officials and leading experts from member countries and observers of International Energy Charter, energy companies and financial organizations, scientific and research institutions came to Ashgabat to participate in the forum. 

During preparation to the chairing in the conference, Turkmenistan developed comprehensive concept that corresponds with international initiatives of Head of the State Gurbanguly Berdimuhamedov. Provision of reliability and stability of energy transport routes was one of the priorities taking into consideration the balance of interests of the producers, transporters and consumers. 

As the Chairing country of the Energy Charter Conference last year, Turkmenistan outlined the processing of hydrocarbon materials for readymade production and its export, involvement of renewable sources of energy, safety of energy carriers supplies, improvement of energy efficiency and energy saving among key directions. At the same time, special attention was paid as usual to ecological aspect and rational use of hydrocarbon resources. 

Such urgent subjects as “Markets of natural gas: Transboundary transport and transit”, “Growing role of liquefied natural gas (LNG) in global energy security”, “Oil supply to the world energy markets” and “Transboundary trade of electrical energy and sustainable development” have been discussed during the forum. The reports reflected the main aspects of the activity of the world community in energy sphere including the practice of the realization of transnational structural projects, the prospects of global trade of liquefied natural gas, the role of Caspian region and Central Asia in provision of energy safety in regional and global scale and other. 

President Gurbanguly Berdimuhamedov pays great attention to the stimulation of the investments for satisfaction of global demand on energy and improvement of investment climate in the countries members of the Energy Charter as well as attraction of new countries to its membership. It is worth mentioning that such countries as Nigeria, Burkina Faso and Mali have joined the organization during Turkmenistan chairing of the Energy Charter Conference. 

Continuing the subject, it is necessary to highlight the importance of the 28th session of the International Energy Charter Conference in Ashgabat on November 28 – 29. Having brought together more than 200 delegates from 50 states, Turkmen capital proved again its high status as competent international ground for discussion of modern condition and tendencies of the world development including the issues of global energy. 

Foreign experts, consultants and top managers of the companies participating in the forum gave their opinions concerning the evaluation of the investment risks in energy sector as well as analysed the main problems and options of the development of the world energy market. 

Discussion of the topics related to the transit of the member countries of Energy Charter to green economy taking into account international obligations for mitigation of the consequences of the climate change and achievements of the Goals of sustainable development, realization of the projects in renewable sources of energy and improvement of energy efficiency fields and other were important moments of the session. 

The Memorandum of Understanding between the Foreign Ministry of Turkmenistan and Secretary Office of the Energy Charter on further development of cooperation as well as the Protocol on exchange of ratification certificates on approval of the Agreement between Turkmenistan and the Federal Republic of Germany on elimination of double taxation with regard to the income and property taxes have been signed during the forum. 

Ashgabat Declaration, strategic middle-term documents that gives high appraisal of the outcomes of Turkmenistan chairing in this organization, was the final document of the 28th session of International Energy Charter. 

VIII International Gas Congress of Turkmenistan and profile exhibition giving new impulse to the partnership in energy sphere were organized in Avaza National tourist zone on May 23 - 24. Participation of more than 300 delegates from 36 countries of the world confirmed high status of the forum. 

Several topical sessions was held during the Congress. One of them was dedicated to the project of construction of Turkmenistan – Afghanistan – Pakistan – India gas line. It was mentioned that the construction of 214-km part of the pipeline on the territory of our country is going on according to the schedule. The contract between «TAPI Pipeline Company Limited» and «ILF» (Germany) on provision of services for initial project planning and project management on the territory of the Islamic Republic of Afghanistan and the Islamic Republic of Pakistan has been signed in Ashgabat in January last year. Technical works have been already commenced on the territories of these sates. 

Survey works, seismic studies and air aerial survey for the definition of optimum route of TAPI, location of gas compressor stations and other auxiliary facilities of the pipeline as well as the project environmental impact assessment have been commenced and continued within 2017. Technical specification of the project for Afghanistan and Pakistan parts of the line has been elaborated. 

The construction of this gas main and the involvement of new regions and markets into international energy system would give additional impulse to industrial production in the region, would develop the trade and investment growth and would support the creation of new working occupancies, President Gurbanguly Berdimuhamedov noted. In its turn, it will make considerable effect on stabilization of political situation. 

The great perspectives are opened with the project of construction of Transcaspian gas line. The energy line that supplying the gas from Central Asia to Europe would be able to be connected with the East – West gas pipeline, which connected gas fields of Turkmenistan into single system, as well as with the energy structure of Azerbaijan and Georgia. 

Numerous meetings between foreign businessmen and the management of oil and gas departments and concerns of Turkmenistan have been held during the Congress. Opportunities of beneficial cooperation planned during the talks would support the realization of the great potential of national gas industry in the interests of both our state and entire world community. 

Development of beneficial relations with interested countries is an important aspect in this sphere. Number of investment projects and joint ventures grows every year. For example, Chinese National Petroleum Corporation (CNPC) is one of the leading business partners of Turkmenistan that carry out exploration, development and production of the fields on Bagtiyarlyk contractual territory, which is the resource base of transnational gas pipeline Turkmenistan – China. 

It is worth reminding that the largest in Eurasia energy line that starts on the right bank of Amudarya River was put into operation in December 2009 with the participation of President of Turkmenistan Gurbanguly Berdimuhamedov and his colleagues from Uzbekistan, Kazakhstan and China. 

As it was noted the interests of foreign investors are stipulated by the presence of huge natural resources, export capabilities of our country and its intensive industrialization. Famous international companies work in Turkmenistan on Production Sharing Agreements terms. Big projects including on exploration and development of offshore hydrocarbon deposits are carried out together with these companies. 

Dragon Oil company (United Arab Emirates) developing the fields on Cheleken contractual territory operates in Turkmen sector of Caspian Sea. The company has invested considerable funds to modernization of oil and gas infrastructure of Jeytun and Jugalybek deposits located near Hazar city. 

Particularly, the company made overhaul of old and drilled new oil wells, build production offshore fixed platforms and subsea pipelines. It reconstructed therefore build new oil terminal Alaja, owing to which simultaneous lifting of several tankers became feasible. Oil storage facility for preparation, storage and offloading of crude oil, mechanical workshops making the maintenance of automobiles, heavy, lifting and oil equipment, desalination plants and other facilities have been built. 

Another foreign company PETRONAS Carigali (Malaysia) develops Caspian fields of Block 1 contractual territory. Complex of works including the drilling of several exploration, appraisal and production wells, preparation for commissioning of such fields as Magtumguly, Diyarbekir and Garagol Deniz where large deposits of hydrocarbons were discovered, has been completed under realization of this large investment project. 

Modern offshore and shore-based infrastructure including offshore constructions facility that are used during the works in the sea shelf was built in Caspian region. Gas treatment plant and onshore gas terminal were built next to Kiyanly settlement. The capacity of the first train of the complex is 5 billion cubic meters of gas and 2.4 million tons of gas condensate per year. Fruitful partnership was also established in training of qualified personnel for Turkmen fuel and energy complex when Turkmen student study in leading Malaysian Universities. 

Big experience of cooperation in oil and gas industry was gained with «ENI S.P.A.» (Italy), «Mitro International Limited» (Austria), «RWE» (Germany) and other companies. 

Putting of water treatment facilities with total capacity of 30 thousand cubic meters of reverse water supply per day into operation at Turkmenbashy Refinery Complex on June 27 last year is a bright evidence of special attention of the Head of the State to ecological aspect in fuel and energy complex. Around 25 thousand cubic meters of pure water, which is equal to the production of large seawater desalination plant, is returned for secondary use. 

The complex of new facilities includes sanitary laboratory provided with precise analytical equipment from the leading manufacturers of USA and Europe. Such treatment facilities provide Turkmenabshy Refinery Complex with new ecological level of production. 

Experiment on production of artificial graphite of petroleum coke produced by Turkmenbashy Refinery Complex has been successfully completed last year. The most efficient practical method of graphite production – heating up the processed material by electrical current flowing through it, was used for the research. 

Artificial graphite has high current and thermal transfer characteristics and resistance to aggressive environment and high temperatures. High lubricating ability, antifriction features and chemical inertness make the products manufactured on tis base be irreplaceable in many science and technology fields. 

The graphite and its products are actively used in oil and gas, nuclear, metal, chemical and space industries. The demand in this product makes the prepositions for arrangement of production of graphite in Turkmenistan and due to its deficiency in the world, for the consolidation of the positions of our country in foreign markets. Synthetic graphite is also used during production of lithium ion batteries. 

Developing advanced technologies of graphite production, Turkmen state has the opportunity to be new player of the artificial graphite world market and entire line of graphite products what in its turn will provide additional financial flow. 

Turkmenistan, which is one of the world leaders in hydrocarbon reserves, tries to provide high level of the wealth of people. Actual measures for diversification of export routes of hydrocarbons, expansion of their processing volumes into highly demanded goods are taken for this purpose. 

These objectives are solved owing to large modernization and technical rearmament of the industry, implementation of new technologies, efficient use of huge potential of modern equipment and high technology developments, improvement of qualification of the specialist working in the deposits of the country. 

New training centre of the State Concern Turkmengaz opened in Choganly living estate of the capital was founded to meet these objectives. All conditions for fast (2 and 3 month courses) and quality training on advanced equipment and technologies that are actively implemented at the deposits of the country are made in the centre. 120 specialists are able to improve the qualification in the centre simultaneously. Three-storey building accommodates seven classrooms and four profile laboratories with excellent profile equipment. 

Electrical laboratory is equipped with the stands simulating the work of complicated electrical equipment of drilling machines, wells, pipelines and compressor stations. It gives opportunity to model any situation and to find optimum solution under the study, having provided the most efficient operation of modern units. 

Audio and visual laboratory allows detailed studying of remote control system modes, monitoring of technology processes and wireless communication channels. Therefore, the specialists of oil and gas industry are able to master the work on advanced equipment, which is installed recently in the fields, to study various malfunctions and emergency situations and to learn to prevent and to respond to the consequences. 

The classroom equipped with personal stands imitating the welding of different parts makes special impression. 3-D visualization and special helmets make virtual reality and full illusion of working process. 

22nd International Conference and Exhibition “Oil and Gas of Turkmenistan 2017” was held on November 2 – 4. Around 500 delegates representing international and governmental organizations including the Energy Charters as well as foreign companies, diplomatic missions and mass media from almost 40 countries of the world took part in it. 

OGT 2017 forum gained a foothold in the world’s business calendar and gain the competence while the composition of the participants indicates great interest that modern Turkmenistan and its potential rise in the world and demonstrates mutual intent to the dialog and cooperation, which are the key terms for establishment and development of business relations, search for perspective directions for the investments. 

Around 40 companies for 16 states including Russia, China, Japan, the Republic of Korea, Singapore, Malaysia, Germany, France, Austria as well as divisions of national fuel and energy complex put their stands at the oil and gas exhibition. 

The participants of the exhibition noted that Turkmenistan, having occupied strong position among the world’s leading energy states, successfully realizes energy strategy, which main aspects are integrated modernization of fuel and energy complex facilities, improvement of equipment and facilities base of the industry including by rapid industrial development of oil and gas deposits discovered in the Amudarya basin, Central Karakums, sea shelf and coastal zone of the Caspian as well as the creation of multi optional system of energy carriers supplies to the world markets. 

Prospects of the development of international, regional and national oil and gas industry were discussed, tendencies of the oil, gas and other hydrocarbon products markets and marketing strategies were analysed during the conference. 

Therefore, the departments of national oil and gas complex have done big work for consolidation of economic potential of the industry in 2017. Nevertheless, grandiose plans are yet to be implemented in future. This is the realization of this objective that numerous initiatives of President Gurbanguly Berdimuhamedov are aimed at. 

For example, it is planned to allocate more than 240 billion manats for social and economic development of the country in 2018 – 2024 where 159.9 billion manats are planned to be invested to oil and gas complex. 

According to the priorities of the Programme of social and economic development of Turkmenistan in 2018 – 2024, new objectives of domestic fuel and energy complex, which same as other industries, are under the stage of innovative development, have been outlined. The utmost attention is to be paid to technical and technological rearmament of the departments of energy sector, creation of modern infrastructure and scientific productions making wide spectrum of petrochemical goods together with the increment of production and export of oil and gas. 

The Plan of geological and technical works in 2018 – 2024, the roadmap for the State Concern Turkmenneft, which operates around 30 fields including more than 600 oil and gas deposits on different stages of the development, has been elaborated.

The Head of the State gave instructions on the expansion of the scale of geological explorations including with the use of 3-D seismic survey methods for the consolidation of the material base of oil and gas industry. The volumes of drilling works and development of exploration and production wells will be considerably increased. Special attention is to be paid to deep wells that lies on 7 km depth. 

Great attention has been paid to the diversification of oil and gas industry and construction of big industrial facilities specialized in processing of hydrocarbons related to petrochemical, chemical and energy branches together with the increment of production volumes of oil and gas and creation of ramified system of transporting of Turkmen energy carriers to the world markets. 

For example, the construction of petrochemical complex for production of 386 thousand tons of polyethylene and 81 thousand tons of polypropylene per year in Kiyanly settlement at the Caspian coast, the plant for production of 1 135 thousand tons of carbamide and 640 thousand tons of ammonia in Garabogaz, gas processing plant for production of 600 thousand tons of Euro 5 A-92 gasoline in Ahal Velayat is carried out. 

Complex of measures for further accumulation of productions of Turkmenbashy Refinery Complex and Seydi Refinery has been elaborated. It includes the construction of diesel fuel hydro treatment, catalytic isodewaxing, catalytic cracking of heavy fuel, secondary petroleum hydro treatment, hydrogen production and other. 

In addition, technical and economic feasibility of benzene production necessary for receiving of polystyrene and rubbers is under the study. Construction of new units for benzene extraction will also allow Turkmen petroleum chemists starting the production of gasoline meeting Euro 5 standards, making synthetic base oils of 2+ and 3+ group. 

Very soon, national oil and gas sector will undergo considerable changes and become modern, high technology, efficient, stably developing complex that is based on natural resources, scientific and technical potential of the country and the world achievements in this sphere. 

In this context, as it was mentioned above, international cooperation in fuel and energy sphere is an important vector of economic strategy of Turkmenistan, which is on the fourth place by proven natural gas reserves. The policy in this sector is built on the principles of transparency, predictability and mutual responsibility, interests of the producers, transporters and consumers. 

Constructive approach to the matters of beneficial partnership and international initiatives of President Gurbanguly Berdimuhamedov aimed at the formation of new model of global energy security have received wide support of the world community. It is visually indicated by the Resolution on Reliable and Stable Transit of Energy Carriers and its Role in Provision of Sustainable Development and International Cooperation adopted twice by the United Nations General Assembly. 

Generally, taking a look on the measures taken under the diversification of fuel and energy complex, it might be noted that Turkmenistan not only considerably strengthened its positions in oil and gas market of the largest countries in Central Asia region last year but also established solid base for playing the role of leading strategic player and reliable partner in energy sphere in near future.