Expert: the Convention on the status of the Caspian sea will help the oil and gas industry

© Fotolia / ekhrajiha sea. Archival photoExpert: the Convention on the status of the Caspian sea will help the oil and gas industry© Fotolia / ekipaj

The signing of the Convention on the legal status of the Caspian sea will benefit the oil and gas industry in the region and create a good investment environment for Chinese companies in the long term, said in an interview with RIA Novosti expert of the Chinese Academy of energy strategy, candidate of economic Sciences, Liu Qian.

Earlier on Friday, the press service of the Kremlin informed that in the forthcoming this weekend in Kazakhstan, the fifth Caspian summit parties summit to sign the Convention on the legal status of the Caspian sea, which was conducted in 1996. Failure to address this issue is one of the obstacles to the construction of TRANS-Caspian pipeline, which could deliver Turkmen gas to Europe. The main consumer of Turkmen gas is now China.

Turkmenistan’s natural gas reserves among the top four countries along with Russia, Iran and Qatar.

«The signing of the Convention on legal status would be beneficial for the stability and development of this region, as well as for exploration of oil and gas in the region. From the point of view of long-term prospects, it will create a good investment environment for Chinese companies,» said Liu Qian.

The expert noted that despite the fact that Transkaspiyskiy the pipeline – national strategy of Turkmenistan on diversification of natural gas exports, as well as the law of that state, the construction of the project is still at initial stage, will it be implemented in the end remains unknown.

In 2011, the European Union adopted a mandate to negotiate a legally binding Treaty between the EU, Azerbaijan and Turkmenistan on construction of TRANS Caspian pipeline system. The agreement on TRANS-Caspian pipeline will provide the basis for the construction of an underwater pipeline linking Turkmenistan with Azerbaijan, and in turn connects this pipeline to infrastructure that will bring gas from Central Asia to the EU.

«Between China and Turkmenistan, there is a long-term agreement on gas supplies. The most important thing for China is to supply commitments to China were carried out in accordance with the contract,» said Liu Qian. He stressed that the capacity constraints on supply, from many sides there are different risks, but the way to reduce such risks are not interfering with construction or other supply routes, and to increase the capacity of supply of the supplier’s country.

Russia as a guarantor

Liu Qian believes that Russian gas will be able to provide stable supply to China in the event of a disruption of supplies of Turkmen gas.

«Last winter after the problems with the supply of Turkmen gas to China, the Chinese side has adopted a series of measures to ensure the stability of supply, including the expansion of other sources. Commissioning in 2019 the Russian-Chinese gas pipeline on the Eastern route will help to further ensure the stability of import in China natural gas», — the expert believes.

According to Liu Qian, if Turkmenistan will not be able to provide a stable supply of natural gas, then other countries-the buyers from South Asia or Europe, in terms of construction of gas pipeline TAPI or TRANS-Caspian pipeline, will also face the risk of instability of supply.

Earlier, the press service of the Kremlin also said that the Convention on the legal status of the Caspian sea, which will be signed at the summit in Aktau, the leaders of the five Caspian countries, suggests that the main area of the water surface remains in common use, and the bottom and subsoil of the country divided among themselves, while the Convention provides for the laying of pipelines according to agreed rules, taking into account environmental factors.