Turkmenistan-Iran-Azerbaijan Gas Swap 'Mutually Beneficial For Parties' – Experts

Turkmenistan-Iran-Azerbaijan Gas Swap 'Mutually Beneficial For Parties' – Experts
Turkmen gas will be supplied to Azerbaijan through Iran in the amount of up to 1.5-2 billion cubic meters per year.

The Turkmenistan-Iran-Azerbaijan gas swap agreement is of great importance as it is necessary to cooperate, primarily with neighboring countries, on the energy field, the Baku-based Trend news agency reported on Tuesday citing Professor of the Azerbaijan State Economic University (UNEC) Elshad Mammedov.

Turkmenistan, Iran and Azerbaijan on November 28 in Ashgabat signed an agreement on swap gas supplies. According to the document, Turkmen gas will be supplied to Azerbaijan through Iran in the amount of up to 1.5-2 billion cubic meters per year. Swap supplies of Turkmen gas to Azerbaijan through Iran will begin on December 22 this year. The trilateral agreement will provide gas to five provinces of Iran.

"We already have such agreements with Russia. In terms of energy supplies, countries should primarily cooperate with their neighbors, taking into account the uneven distribution of energy resources. Even in energy-rich states, resources are concentrated unevenly. Iran has huge gas reserves, but at the same time, there is traditionally an energy deficit in the northern regions bordering Azerbaijan. And in this regard, supplies from Azerbaijan have very great prospects. I believe that the regions of Iran bordering with Azerbaijan are more profitable to receive gas from Azerbaijan than from the southern regions of Iran," Mammedov told Trend.

At the same time, Mammedov said, it is more profitable to supply gas to Nakhchivan from Iran, adding that it is extremely important to ensure the sustainability of energy supplies for the domestic industry and consumers.

Mammedov believes that this is also an important decision for Turkmenistan.

"Swop supply agreements play a mutually beneficial role for both sides. There are cases when Turkmenistan cannot find buyers for its huge gas resources due to the relevant logistical problems. In this aspect, bearing in mind that the volume of gas consumption in Azerbaijan is sharply increasing, we can supply the domestic market with Turkmen gas," Elshad Mammedov stated.

Francis Perrin, Senior Researcher at the Center for the New South Policy (PCNS, Rabat) and the French Institute for International and Strategic Relations (IRIS, Paris), said the deal shows that the three countries are seriously trying to develop their economic and energy cooperation.

"Turkmenistan has huge gas reserves. According to the BP Statistical Review of World Energy, Turkmenistan's proven gas reserves are the fourth largest in the world after Russia, Iran and Qatar. This country is certainly trying to increase its gas exports, and the recent agreement with Iran and Azerbaijan is a new step in this direction. Gas volumes can reach two billion cubic meters per year or slightly more (5-6 million cubic meters per day)," Perrin said.

Perrin also said Iran has huge gas potential, but the country often faces gas shortages in its northern provinces in winter.

"This is also an opportunity for the Islamic Republic of Iran to develop its economic and energy relations with its neighbors and enhance the country's role as a possible energy hub due to its geographical location and energy infrastructure. Azerbaijan will receive 5-6 million cubic meters of natural gas per day, and this agreement will help improve bilateral relations with Iran," Perrin added.

He noted that Iran has also taken some steps to resolve the gas payment issue with Turkmenistan.

"There is great potential for cooperation between Turkmenistan, Iran and Azerbaijan, as well as some other countries in this part of the world," Perrin concluded.