Iran, it seems, was calling Turkmenistan’s bluff earlier this summer when Tehran said it no longer needs gas from its northern neighbor. Now a top official says Tehran will keep buying.
That is good news for Turkmenistan, which is so dependent on its main gas customer, China, that it is starting to look like a client state.
Iran is committed to increasing its own domestic gas production to up to a billion cubic meters per day by 2017, a target one industry analyst thinks is possible but unlikely within such a tight timeframe. But supplying Iran’s northern regions with domestic gas is complicated by its lack of infrastructure. So, since 1997, Iran has bought gas from Turkmenistan to service its north, and sold its own gas abroad.
Deputy Oil Minister Hamid Reza Araqi said this week that his boss and Turkmen President Gurbanguly Berdymukhamedov had met in Ashgabat this month to hammer out a new purchase agreement. According to regional news agency AKIpress, the meeting happened November 7.
“The deal makes it possible to raise the amount imported from Turkmenistan in cold months of the winter; starting in the beginning of the current year, Turkmenistan has exported 24-25 million cubic meters of natural gas to Iran [daily],” said Araqi, in comments carried in English by Iran’s Mehr news agency on November 19.
The agreement contains a provision to increase this to 30 million cubic meters daily, he added.
For Kyrgyzstan observers, reports that kerosene is being stolen from a Russian airbase and illegally sold on the open market will hardly surprise. But it is still embarrassing.
Last week Kyrgyz authorities formally began investigating why a truck stopped leaving the Kant Airbase last month was found carrying 13 tons of stolen kerosene.
Details about the October 7 incident that triggered the November 11 investigation are still scarce. The driver, who appeared to have entered the Kant base without documents, has not been identified in press reports.
It seems unlikely a theft from the heavily guarded base would be possible without the connivance of Russian soldiers stationed there, Ruslan Umarov, who is heading the investigation for the State Service for the Fight Against Economic Crimes, conceded on November 12. “We have a circle of suspects. Currently we are clarifying the market channels, buyers and suppliers. It is possible that military servicemen at the Kant Airbase are involved in the case,” Umarov is quoted as saying by several Kyrgyz news outlets.
Kant receives its kerosene, which it uses it to fuel fighter planes and other aircraft, from a Kyrgyz-Russian joint-stock company partly owned by Russian energy behemoth Gazprom: Gazprom Neft Aero-Kyrgyzstan. The company has friends in high places. Sapar Isakov, President Almazbek Atambayev’s chief foreign policy advisor, was formerly chair of the company’s board.
There is a good chance that economic jockeying between China and Russia in Central Asia will intensify in the coming months. For Russia, Chinese economic expansion could put a crimp in President Vladimir Putin’s grand plan for the Eurasian Economic Union.
Astana has promised to save Kyrgyzstan from near-certain energy crisis this winter, committing to supply over a billion kilowatt-hours of electricity and releasing several Kyrgyzstan-bound oil tankers stuck on the border between the two countries since April. But questions remain about the terms of the deal signed by Kazakhstan’s Nursultan Nazarbayev and Kyrgyzstan’s Almazbek Atambayev on November 7.
Chiefly, how will Kyrgyzstan finance the difference between the cost of the electricity it is buying from Kazakhstan and the low rates its own citizens expect to pay—lower, according to energy officials, than the cost of production?
In other words, Kyrgyzstan has agreed to pay Kazakhstan far more than it charges its citizens per kilowatt-hour. Most of the energy will be subsidized by the impoverished government, Nurbek Elebaev, director of Kyrgyzstan’s State Department for the Regulation of the Fuel and Energy Complex, told Vechernii Bishkek on October 31. (Note: $1 is about 58 soms at current rates.) He said:
It is worth noting that the cost of the imported energy is 5.13 soms for a kilowatt-hour. Accordingly, every kilowatt-hour will be subsidized [by Kyrgyzstan] by around 3 soms. Moreover, 5.13 soms is the cost of electricity up to the Kazakh border. The cost of transit from the border to the consumer will be borne by [Kyrgyzstan’s] energy company. How the company will cover the financial deficit will be decided by the government. The cabinet will need to borrow money. This tariff will apply to 1 billion kilowatt-hours of electricity. A further 400 million kilowatt-hours will be determined by an exchange in kind.
It has been a chastening few months for gas-rich Turkmenistan. Two long-standing energy buyers have indicated they will stop purchasing the country’s natural gas, potentially leaving Ashgabat dependent on Chinese demand.
With the arrival of November, the serfs trickle home from Turkmenistan’s cotton fields. But a culture of state employees being forced to labor in menial jobs continues throughout the year, says an annual monitoring report. As they wait for the fields to bloom again with “white gold,” low-skilled municipal workers such as janitors and security guards are obliged to do free housekeeping for Turkmen bureaucrats, and to travel to faraway cities to participate in cleanups for the state, the report alleges.
Turkmenistan’s Central Asian neighbor Uzbekistan is usually the focus of international flak for mobilizing its citizens – notably students – to harvest cotton each fall. But totalitarian Turkmenistan, which produces more cotton per person than Uzbekistan, is just as keen on exploiting its bloated public sector for field hands, according to the October 14 briefing, published by Alternative Turkmenistan News (ATN), a service run by Turkmen exiles who partner with Amnesty International and the Norwegian Helsinki Committee.
Drawing on domestic accounts, the second annual report provides an important insight into Turkmenistan’s labor market. It pays particular attention to Turkmenistan’s low-paid state employees who have limited means to defend their rights in a country where de facto unemployment is high and cowed government workers can be replaced easily.
As Uzbekistan continues the annual cotton harvest that is largely responsible for the Aral Sea’s demise, officials in Tashkent are boasting that a recent donor conference raised close to $3 billion to help save the endangered lake, once the world’s fourth-largest.
Verifying Uzbek government claims is never easy, and conference attendees are not hurrying to confirm or break down the impressive figure. But an event for the Aral Sea did take place in Urgench, a city not far from the Aral’s receding shoreline, on October 27 and 28. Addressing the conference via pre-recorded video, UN Secretary General Ban Ki Moon demanded better international coordination to “mitigate environmental catastrophe” reported uz24.uz, an Uzbek outlet. According to the independent Uznews.net, the conference was organized by the authoritarian state in conjunction with the International Fund for Saving the Aral Sea, a regional club, which critics say has done almost nothing since it was set up in 1993.
NASA satellite photos released in late August show that even a partial replenishment of the water-starved Aral is unlikely: The lake’s eastern tranche has completely dried up for the first time in history.
The Bishkek office that website developer Mikhail Ageev shares with three colleagues – a line of tables facing out over the city panorama, where each hunches over a laptop – is so minimalist it looks like it could be abandoned at a moment's notice. “People in our line of work often talk about leaving [Kyrgyzstan],” said Ageev.
With a cold, dark winter inching closer each day in Kyrgyzstan, the government is desperately trying to strike bilateral energy-import agreements with anyone and everyone. But as policymakers go hunting around Central Asia to plug an estimated deficit of over 2 billion kilowatt-hours, prices and political differences are potent sticking points.
Any bilateral deal would require the differential in electricity costs be borne either by the insolvent government, or by ordinary Kyrgyzstanis, who are accustomed to paying $0.015 per kilowatt-hour. That’s far below the cost of production and substantially less than citizens pay in any other Central Asian country.
So Kazakh electricity, which costs around four times as much for Kazakhs, is expensive to most Kyrgyz, although that didn’t stop Astana and Bishkek agreeing to an import deal in principle last week. Tajik electricity is over one-and-a-half times as expensive as the Kyrgyz version and it is doubtful whether a country whose own rural residents spend a lot of time in the dark has any power to spare.
The perfect cure to a Kyrgyz winter of misery, then, could come from gas-rich Turkmenistan.
“What is Putin’s favorite female name?” roars the announcer of a Vladimir Putin-themed quiz at the opening of Putin Pub in Bishkek on Saturday October 11. “Alina!” the crowd chants back in unison, referring to the former Olympic gymnast, Alina Kabaeva, long rumored to be the Russian president’s lover. “Not Lyudmila?” the announcer goads, name-checking Putin’s ex-wife. “No way!” comes the decisive reply.
Aside from the quiz, ubiquitous Putin paraphernalia, and alcoholic drinks named after both Kabaeva and Putin’s political patron-turned-rival, the late Boris Berezovsky, the Putin Pub, located in a southern suburb of Bishkek, has a strangely familiar feel. The pub’s smart phone-wielding administrator, a stout man with a mane of black hair and a pencil-thin beard, seems to have been in charge of every newly opened Bishkek restaurant-pub in recent memory, for instance.
In a nod to the stealth military operation that laid the foundations for Moscow’s annexation of Crimea, wait staff wear the word “#вежливыелюди” (Polite People) stenciled on the reverse of their uniforms. Thankfully these waiters are far more communicative than the unexplained army types who mysteriously surfaced on the Crimean Peninsula in February before calls for a referendum to join Russia. But bringing the onion rings while they’re still warm seems to be a challenge, as it is for waiters in almost every Bishkek gastro-pub.