Gholamhossein Mozaffari, the governor of Khorasan Razavi, announced the formation of a consortium for the transfer of gas from Turkmenistan to Sarakhs. This consortium has been established with the aim of utilizing gas in steel industries and other industrial units. As the cold approaches and concerns about gas pressure drops and outages increase, this action could be of great importance for the province.
Historical Context and Challenges
Past experiences regarding gas trade with Turkmenistan recall issues such as the sudden closure of the gas export valve to Iran during the winters of 2007 and 2016. In the winter of 2007, Turkmenistan halted gas exports to Iran during severe cold and demanded a ninefold increase in price to resume them. This decision led to an increase in the price of each thousand cubic meters of gas from $40 to $360. Iran, which needed gas, agreed to this price increase, but this later became one of the financial disputes between the two countries.
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Financial and Economic Consequences
Financial disputes between Iran and Turkmenistan continued, and in the winter of 2016, this country again halted gas exports to Iran without prior notice. Turkmenistan cited financial issues as the reason for this action, and ultimately the dispute between the two countries was taken to international authorities. In 2023, a report was published indicating that Iran faced a ruling to pay a debt and penalty of 1.6 billion euros. Javad Owji, the Minister of Oil, announced that Iran's gas debt to Turkmenistan has been settled.
Thus, the history of gas disputes between the two countries is not just an old memory but a matter that has incurred heavy financial costs for Iran. Therefore, the main question is whether gas exports from Turkmenistan can be relied upon during the cold days of the year?
Gas Supply and Industrial Planning
Mozaffari also referred to the gas supply limitations and their consequences for industries during a meeting of the Energy Commission of the Mashhad Chamber of Commerce. According to the latest statistics, about 446 industrial subscribers in the province consume 762 million cubic meters of gas annually. A 10% reduction in the consumption of these units could save about 76 million cubic meters. However, savings and imports are two separate issues.
In a situation where gas limitations can affect industrial activities, there is a need for precise planning and assurance of continuous gas supply. Importing gas from Turkmenistan could cover part of the industries' needs, but if any dispute arises and the gas flow is halted, industries will again face uncertainty.
It now needs to be clarified what guarantees exist in the contract for the continuity of exports and what obligations will fall on the Turkmen side in the event of a gas halt. These issues must be clarified before the cooperation begins to prevent the recurrence of unpleasant past experiences.
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