Turkmenistan - Saudi Arabia: cooperation for the sake of universal development

In the second half of October 2018, the President of Turkmenistan Gurbanguly Berdimuhamedov received Minister of Trade and Investments of the Kingdom of Saudi Arabia Majid Bin Abdullah Al Kasabi who arrived in the capital as the head of interstate delegation for participation in the work of the sixth session of Intergovernmental Turkmen – Saudi Commission on trade and economic cooperation.

The high guest conveyed warm greetings of the King of Saudi Arabia Salman Bin Abdul Aziz Al Saud and Crown Prince Muhammed Bin Salman Al Saud who also addressed sincere wishes of peace, wealth and success to Turkmenistan nation.

Having expressed the gratitude for good words, President Gurbanguly Berdimuhamedov passed return wishes to the leaders of Saudi Arabia and highlighted that Turkmenistan pays great attention to consolidation of traditional friendly interstate dialog. Having noted with delight that recently, the cooperation between two countries gained new quality and content, Turkmen leader stated the presence of significant potential for steadfast improvement of beneficial partnership, which meets mutual interests. At the same time, the importance of agreements achieved during the official visit of the President of Turkmenistan to the Kingdom of Saudi Arabia in May 2016 has been highlighted.

During the meeting, the sides noted the role of the Intergovernmental Turkmen – Saudi Commission for trade and economic cooperation in further expansion of beneficial business contacts.

The Minister of Trade and Investments of friendly state highlighted that favorable conditions have been made for successful joint work. First of all, these are optimal investment climate and «open door» policy of President Gurbanguly Berdimuhamedov, which attracts potential foreign partners to perspective Turkmen market.

In this regard, Majid Bin Abdullah Al Kasabi, who is the Co-chairman of the above-mentioned Commission, expressed the confidence that new steps for specification of the cooperation, especially in fuel and energy sector, textile and food industry, banking sphere, mass media, science, culture, sport and tourism, would be made at the current session.

It was highlighted that being recognized world energy states, Turkmenistan and the Kingdom of Saudi Arabia are willing to intensify the cooperation in oil and gas sector. Recently, Turkmenistan actively elaborates on the objectives of creation of optional system of delivery of the energy carriers to the world markets steadily implementing important energy projects. Construction of transnational Turkmenistan – Afghanistan – Pakistan – India gas line is one of the examples of this.

Having noted that Turkmenistan relies on latest achievements of scientific and technical progress in realization of its economic policy attracting leading foreign companies and investments, Turkmen leader proposed the partners from Saudi Arabia to review in details the opportunities of joint projects in the main spheres. The relevance of regular business meetings and forums supporting the establishment of close contacts between the state and private structures was also highlighted.

As it is well known, an important aspect of Turkmenistan's energy strategy is the expansion of the geography of export routes for the supply of Turkmen energy to world markets, including through the creation of a multivariate transport infrastructure. In this area, large investment projects are being implemented, among them the construction of the Turkmenistan-Afghanistan-Pakistan-India gas pipeline (TAPI) occupies a special place.

In 2010 the TAPI project got in the active phase by signing in Ashgabat a four-party intergovernmental agreement on this project. Then, from 2012 to 2016, the legal framework of the project was coherently refilled by the Agreements for the purchase and sale of natural gas with all buyers, joint-stock and investment agreements.

In 2013, the Governments of Turkmenistan, Afghanistan, Pakistan and India designated their state-owned gas companies to promote and invest in the TAPI project.

The project includes comprehensive works on the design, procurement, construction, operation and maintenance of the 1840 km pipeline from Turkmenistan to Afghanistan, Pakistan and India. It is envisaged that after full commissioning of TAPI, that within 30 years up to 33 billion cubic meters of natural gas per year will be exported.

This project can clearly be reckoned among a small number of international projects. It will have a stimulating effect on the sustainable development, social and economic growth of the countries of the region and will ensure their energy security. These factors, in turn, are the "pillars" on which the modern architecture of the energy space is held.

In a relatively short period of time, significant progress has been achieved in the implementation of the TAPI project, in particular, on key agreements such as the Agreement with Host Governments and the Agreement on the Transport of Natural Gas. A great impulse for the promotion of the project was given by the establishment of the consortium «TAPI Pipeline Company Limited» and subsequently the election of the State Concern «Turkmengas» as the leader of this consortium.

The start of construction of TAPI was given in December 2015 in Mary region. Presidents of Turkmenistan and Afghanistan, high-ranking representatives of India and Pakistan took part in the solemn ceremony on the occasion of the welding of the first joint symbolic «golden link» of the new gas transportation artery. The laying of the 214-kilometer section of the gas pipeline in the territory of Turkmenistan is carried out by the State Concern «Turkmengas».

In October 2016, to finance the construction of the Turkmen part of the TAPI gas pipeline the Agreement of the Government of Turkmenistan with the Islamic Development Bank was signed. The document provides for the allocation of a credit in the amount of 700 million US dollars.

In November 2017, in Riyadh, the regular meeting of the Intergovernmental Turkmen-Saudi Commission on Trade and Economic Cooperation with the participation of industry and energy leaders, as well as large companies of Saudi Arabia was held. During the meeting, issues of trade, economic and investment cooperation, including in the fuel and energy sector, were discussed, specific in several areas agreements were reached. In particular, the State Concern «Turkmengas» has signed an agreement with the Global Pipe Company for the delivery of a large batch of pipe products intended for the construction of TAPI.

As you know, the resource base of TAPI at the initial stage will be the super huge gas field «Galkynysh». As part of the development of this field, the State Concern «Turkmengas» together with its foreign partners is doing a great job, aimed to provide «blue fuel» for TAPI at a high level.

Preliminary design for the gas pipeline and all stations, which is better known as Front-End Engineering & Design, has been completed.

The governments of the participating countries fully support the TAPI gas pipeline project. There is a full-scale assistance to the activities of the consortium «TAPI Pipeline Company Limited» both at the level of shareholders, which in turn are state-owned gas companies, and at the level of state departments of the respective jurisdictions.

That it is crucially important to involve Afghanistan in the implementation of major energy, transport and communications projects as a full-fledged partner. Turkmenistan regard this issue as a strategic guideline for Afghanistan, its role in regional and global processes and the guarantee of the prosperity and well-being of the Afghan people.

By steadfastly working towards this goal our country is implementing the project of building the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas line, carrying out the construction of a power supply line and a fiber optic communications network that are supported by international partners and major financial institutions. A new railway leading towards Afghanistan has also been completed. Turkmenistan continue to provide humanitarian assistance to Afghanistan by building social facilities, sending humanitarian aid convoys, training of qualified national specialists for various segments of the Afghan economy and social sphere.

Since the establishment of diplomatic relations, our countries have demonstrated the effectiveness and enormous potential of bilateral cooperation, one of the important areas of which is the oil and gas industry, which is strategic for both countries. And today, guided by the principles of mutual respect for the interests of the two friendly peoples, Turkmenistan and Saudi Arabia reaffirm the mutual desire to diversify a full-scale interstate dialogue, built on the principles of equality, trust and mutual benefit.