Shell to export Turkmen gas via Iran

Shell has announced plans to create an international pipeline consortium aiming to deliver Turkmen gas to Turkey and Europe via Iran. Turkmen deputy prime ministers Batyr Sardzhayev, responsible for oil and gas, and Yelly Kurbanmuradov, foreign investment, recently met Shell representatives in Houston who agreed to form a consortium early in 1998.
Last May the presidents of Turkey, Turkmenistan and Iran agreed to build a 3,000 km (2,000 miles) gas pipeline from Turkmenistan through neighbouring Iran and on to Turkey. Under the deal, Turkmenistan will supply 28-30 billion cubic metres per year (bn cmpy) of natural gas to Turkey for 30 years. The cost of the project is estimated at $ 1.5-2.5 billion. An official said a feasibility study carried out by Shell and Sofregaz, a unit of state-owned Gaz de France, would be completed by the end of this year.
"The Turkmen government believes the pipeline will become a reality by the year 2000," the official said.
Turkmenistan's current exports of natural gas have to travel north through Russian-controlled pipelines. Much of the volumes are diverted to other ex-Soviet states which cannot afford to pay for the gas.
The United States government, which imposes sanctions on U.S. companies which invest more than $ 20 million in Iran's oil and gas sector, has turned a blind eye to the Turkmen pipeline plan, saying it does not involve the purchase of Iranian gas. U.S. oil executives say the shortest route from the landlocked territory to international markets is via Iran.