BMI View: We have strongly reduced our gas production outlook for Turkmenistan this quarter on the back of increasingly limited ex port options for the country: Russia and Iran are curtail ing imports and Chinese gas intakes will grow at a slower pace than expected on the back of slowing economic growth. This leaves Turkmenistan increasingly dependent on China, with little credible export market alternatives over the short-to- medium term.
|e/f = BMI estimate/forecast. Source: BMI/EIA|
|Crude, NGPL & other liquids prod, 000b/d||276.0||289.1||302.9||314.7||326.9||336.7||343.8|
|Dry natural gas production, bcm||74.0||65.1||62.2||64.1||65.3||68.0||72.7|
|Dry natural gas consumption, bcm||27.9||28.7||29.3||30.2||31.7||33.2||34.9|
|Refined products production, 000b/d||172.7||173.6||174.4||176.2||178.0||179.7||181.5|
|Refined products consumption & ethanol, 000b/d||154.1||164.9||174.8||185.2||196.4||208.1||220.6|
A renewed emphasis on international investment, along with developments by Turkmennebit, has lead to a slow but progressive increase in oil production. This will endure over the coming years. Larger production growth within our forecast period, however, is unlikely until a sustainable agreement is reached between Iran, Turkmenistan and Azerbaijan on the Caspian maritime border dispute.
The difficult business environment could, however, dissuade international investors, notably at a time of capital expenditure cut backs as oil prices remain low. For example, German company DEA Deutsche Erdoel is reportedly planning to relinquish its Caspian Sea concession as of October 2015 over frustration at excess bureaucracy, corruption and a lack of permit granting.
Despite its large gas production potential, Turkmenistan's actual production will remain limited by its export options. With Russia and Iran increasingly reducing imports of Turkmen gas, the country's production will remain almost entirely dependent on domestic consumption growth and export levels to China. With economic slowdown in China and Russia quitting Turkmen gas imports, we have substantially reduced our gas production outlook this quarter for Turkmenistan over our 10-year forecast period.
Turkmenistan's level of gas consumption will take up an increasing proportion of produced gas as the country's exports stagnate on the back of falling exports to Russia and Iran. As production continues to ramp up, we believe that gas consumption will follow suit although at a slower pace, to increase to 46.72 in 2025 compared with an estimated 28.70 in 2015.
Turkmen gas exports will fall for a second successive year in 2016 as Russia and Iran curtail imports. With a negligible chance of establishing new export routes, the country will be increasingly dependent on China and its long-term energy demand.
The Turkmenistan Oil & Gas Report has been researched at source and features BMI Research's independent forecasts for Turkmenistan including major indicators for oil, gas and LNG, covering all major indicators including reserves, production, consumption, refining capacity, prices, export volumes and values. The report includes full analysis of industry trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Turkmenistan Oil & Gas Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and competitive intelligence on the Turkmen oil and gas industry.
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BMI Industry View
Summary of BMI’s key forecasts and industry analysis, covering oil and gas reserves, supply, demand and refining, plus analysis of landmark company developments and key changes in the regulatory environment.
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A profile of the upstream and downstream sectors, including analysis of reserves, output, consumption and trade of energy products; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.
Comparative company analyses by USD sales, % share of total sales, number of employees, year established, ownership structure, oil production (‘000b/d), gas production (bcm), downstream capacity (‘000b/d) and % market share.
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Regional perspective on size and value of the industry. Plus comparative rankings by production, refining, imports and exports of oil, gas and LNG.
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