The former Soviet republic of Turkmenistan is becoming a magnate for international energy conglomerates keen to invest in the country’s massive oil and gas reserves. However, Turkmenistan remains a one-party state that observers have likened to a ‘North Korea with
money.’

Human rights abuses abound in the resource rich desert nation perched at the western edge of Asia, just north of Iran and Afghanistan. Hope that President Gurbanguly Berdymukhamedov, who is considerably less eccentric than his predecessor Saparmurat Niyazov, might initiate democratic reforms has faded.

With a population of just over 5 million, Turkmenistan sits on top of huge onshore and offshore hydrocarbon deposits and due to its relative proximity to European gas markets, Turkmenistan is poised to become a major supplier. If proposed pipelines such as the European Union backed Nabucco develop as planned, and if the littoral states of the Caspian Sea which include Azerbaijan, Kazakhstan, Iran and Russia, can divvy up the seabed in a rational way, Turkmenistan’s state coffers could receive a welcome injection of euros without any of the hassle of having to sell their gas to Russia first.

Relations with Moscow have soured recently. Gazprom, the Kremlin-controlled energy monopoly, had sewn up Turkmenistan gas exports with a 25-year contract to buy 50 billion cubic meters (bcm) of gas annually. But when European gas prices and demand tumbled in early 2009, a mysterious explosion on a key pipeline abruptly halted Turkmen exports to Russia. Ashgabat has since withdrawn its claim that Gazprom had a hand in the blast, but exports have been slow to resume. However, Ashgabat is developing a policy of export diversification and will in early 2010 begin exporting 40 bcm of gas to China via a new 1,800-kilometer long pipeline stretching from the Karakum desert to Xingjian. Gas exports to neighbouring Iran, meanwhile, are also rising.

Deirdre Tynan is a reporter specialising in Central Asian affairs. She is based in Bishkek, Kyrgyzstan.