KIEV, June 29 (RIA Novosti, Taras Burnos) - In September 2005, Ukraine and Turkmenistan might sign a 25-year contract on supplies of Turkmen natural gas to Ukraine, which will turn the Central Asian republic into Ukraine's main gas supplier.
"I have handed over Ukrainian President Viktor Yushchenko's invitation to President Saparmurat Niyazov of Turkmenistan to visit our country and sign the contract on natural gas deliveries to Ukraine for the period of 25 years," Alexei Ivchenko, the board chairman of Naftogaz, Ukraine's national oil and gas company, told a news briefing on Wednesday.
Ivchenko said Niyazov had given his verbal agreement to visit Ukraine in September.
"Ukraine is drafting the contract," said Ivchenko. "We expect Turkmenistan to supply 60 billion cubic meters of natural gas (a year( to Ukraine."
Ivchenko did not disclose how much the contract was worth, saying it was a commercial secret.
He said the contract might come into force in 2007.
Turkmenistan supplies natural gas to Ukraine via Russia and satisfies about 50% of the country's demand for the fuel.
Russia and Turkmenistan have signed a 25-year agreement on cooperation in the natural gas sector already, and Gazexport, an affiliate of the Russian gas giant Gazprom, currently buys Turkmen gas at $44 per a thousand cubic meters. In 2007, Turkmenistan will start selling gas to Russia at world prices, or the two countries could switch to a payment scheme used in contracts with Western partners, which is linked to the "oil products basket."
Turkmenistan has been energetically developing its natural gas exports. It has signed a contract on gas exports to Iran for the period till 2018. However, the republic is not able to deliver more than 13 billion cubic meters of natural gas a year to the country for technological reasons. At the same time, Turkmenistan delivers 30-40 billion cubic meters, at $42 per 1,000 cubic meters, to Ukraine every year. Turkmen officials have repeated their country intends to increase gas exports to 100 billion cubic meters a year overall by 2010, with output at 120 billion cubic meters.
Even if Turkmenistan continues intensive gas production, its reserves will last for a long time, as its proven reserves are estimated at 22.5 trillion cubic meters.
