July 26, 2016

The most populated countries in the world, India and China are among the countries that recently attract the most attention both with the size of their economies and their economic growth rates. Having been left far behind the developed countries in terms of per capita energy consumption, India and China are expected to further increase their already very large energy consumption volume in the future. According to estimates China and India alone will be consuming one thirds of the total energy consumed in the world in just a few years time. 21st century will be the century of “blue gold” When we take a closer look at these markets we see that although oil and coal stand out with their high market shares among all energy sources, natural gas comes forward as the most important one thanks to its ever growing significance. In fact the importance of natural gas as an energy source has increased not only in India and China but across the world in so much that it has a direct influence on international relations. In 1970s approximately 45 percent of the total energy consumed in the world was oil and only 15 percent came from natural gas. Today the share of oil in total energy consumption is as low as 30 percent while the share of natural gas has risen to 25 percent. In the future this ratio is expected to continue to change in favor of natural gas. Oil is dubbed “black gold” due to its international importance in the past century. Today, taking into account the ever increasing importance of natural gas in the 21st century we say that if 20th century was the century of “black gold”, then 21st century will be the century of “blue gold”. Natural gas markets of future: China and India The largest energy markets in the world China and India have also been influenced by these developments in world energy market and swiftly began their transition to natural gas. Just 10 years ago the annual natural gas consumptions in China and India were 33 and 27.6 billion cubic meters respectively. In the last decade China’s natural gas market has grown nearly 4.5 times and last year the market reached to a volume of 147 billion cubic meters. In the same period India’s natural gas market has doubled in size. It is expected that natural gas markets in China and India will continue to grow and reach to 395 and 177 billion cubic meters of volume respectively by the year 2035. In other words, China and India alone will constitute nearly 12 percent of the world’s total natural gas consumption by 2035. With the realization of TAPI pipeline, Asia’s energy and especially natural gas maps have significantly changed, providing an important advantage in energy supply security of the world’s largest energy market China. TAPI Pipeline Project comes to life step by step After the successful realization of Turkmenistan – China natural gas pipeline project that carries the Turkmen “blue gold” all the way from Turkmenistan to China, another destination comes to the fore: India. Known as TAPI, the Turkmenistan – Afghanistan – Pakistan – India pipeline project has been at the top of energy agenda especially since 2007. Today the project comes to life step by step. The 17th management committee meeting of the Turkmenistan – Afghanistan – Pakistan – India (TAPI) pipeline project was recently held in Ashkhabad. A natural gas trade agreement between Turkmengaz State Concern and Afghan Gas Company was signed at this meeting. Last year Turkmengaz signed another trade agreement with Pakistan Inter State Gas System Limited at Avaza, the pearl of the Caspian Sea and Turkmenistan’s tourism center. The same day Turkmengaz State Concern signed yet another natural gas trade agreement with India’s GAIL Limited. With the signing of these agreements, all natural gas trade contracts within the framework of this project have been finalized. After the completion of gas purchase contracts the second phase of the project began. During the meeting in Ashkhabad the parties also agreed on establishing the TAPI Ltd consortium, preparing and registering the articles of organization and signing a contract with Transaction Counselor as soon as possible. TAPI project guarantees India’s energy security Today India is one of the world’s largest energy markets and energy consumption in this country is expected to further increase in the future. Although most of the energy consumed in India comes from oil and coal, natural gas consumption in this country is also on the rise. Today the share of natural gas in India’s energy resources consumption is 8 percent. This rate is expected to increase in the future. Taking into account the fact that natural gas is particularly used in electricity production in this country, it is evident that any disturbances in natural gas supply would have a severe impact on Indian economy and social life. Today India imports its natural gas in liquefied natural gas form (LNG). Having imported 20.5 billion cubic meters of natural last year, India is a major buyer in global LNG market. As a significant gas provider Qatar has been exporting LNG to India since 2004 (16.1 billion cubic meters). India’s gas imports will fourfold According to the estimates of International Energy Agency, India’s annual natural gas consumption is expected to reach 177 billion cubic meters by 2035. The country will produce 100 billion cubic meters of natural gas within the same period. In other words, India’s natural gas imports will fourfold in the near future and reach an annual amount of 80 billion cubic meters. Therefore, in order to meet its increasing natural gas demand and maintain energy security, India shows an interest in the “blue gold” of Turkmenistan, the “golden land of energy” and one of the most important energy countries in the world. Once implemented, the TAPI Pipeline will redraw the energy map of not only India but also whole Asia, with an estimated total length of 1735 kilometers as China and India are two major natural gas consumers and importers in Asia. Blue Silk Road comes to life Having its source in Turkmenistan and stretching out through various pipelines all the way to India and China at one end and to Turkey and European lands at the other, the Turkmen “blue gold” also marks the revival of the historical Silk Road. Perhaps in the future all these pipelines will be evaluated as a whole and referred to as “silk road pipe lines” or the “blue silk road”.