Turkmenistan restricts gas exports to Iran

In 2016, Russia stopped buying gas from Turkmenistan, and China is its sole customer

The energy-rich Central Asian nation of Turkmenistan said today that it has restricted natural gas deliveries to Iran over unpaid debts.

Turkmenistan's foreign ministry said that its ability to maintain its gas transportation infrastructure has been compromised by Iran's failure to continue paying off old debts since 2013.

Officials say gas deliveries were restricted on January 1, but did not specify if they have been halted altogether.

The Turkmen government has not specified the size of Iran's outstanding debts, although Iranian state media have put the figure demanded by Turkmenistan at around $2 billion.

Turkmenistan says it pleaded with Iran for the past year to resolve the debt arrears but received no response.

A gas pipeline was built between Turkmenistan and Iran in 1997. Another route was completed in 2010, bringing Turkmenistan's annual gas export potential to Iran to 12 billion cubic meters.

Turkmenistan has been exporting gas to Iran under a 1997 agreement, but occasionally raises its prices during the winter.

In 2006, it suspended shipments and demanded a nine-fold price increase. Iran eventually accepted the higher prices for a short period.

In 2016, Russia stopped buying gas from Turkmenistan, which is now left with China as its sole customer.

Turkmenistan hopes to broaden its client base by building a new gas pipeline passing through Afghanistan, Pakistan and reaching India, although the feasibility of this project is cast into doubt by security concerns and lack of financing.