BP bets on Central Asia's gas reserves

In western Kazakhstan and Uzbekistan, a region that has received little attention to date is becoming the focus of new energy hopes. The Ustyurt Plateau, a vast landscape between the two countries, could prove to be one of the most exciting exploration areas in Central Asia. And BP is increasingly positioning itself as a driving force. Several new agreements and political signals indicate that major natural gas and oil deposits could be developed in the region. This means that not only the plateau itself is gaining in strategic importance. The idea of a trans-Caspian gas corridor, which has been under discussion for years, is also gaining new impetus. BP is currently visibly expanding its presence in the region. At the beginning of April, a subsidiary of the British group signed an exploration contract for a promising block on the Ustyurt Plateau together with the Kazakh state-owned company KazMunayGaz. For Astana, this is more than just routine business: the agreement is intended to mark the start of more in-depth cooperation on new production projects. At the same time, there are increasing signs of a new energy policy axis in Uzbekistan. BP is holding talks there about possible participation in projects together with Uzbekneftegaz and the Azerbaijani company SOCAR. Uzbek government representatives are already openly talking about directing foreign investment to the Ustyurt region. The background to this is a production sharing agreement that Uzbekistan concluded with SOCAR last year. It covers the exploration of a large area and the joint development of economically viable discoveries. When President Shavkat Mirziyoyev spoke shortly afterwards of a "very large natural gas field" in Ustyurt, this initially seemed like political hyperbole. However, the ongoing efforts to involve BP in the project lend new weight to this announcement. There are also increasing indications of a major energy geological re-sorting north of the plateau. In Kazakhstan, a large onshore oil and gas deposit was reported in the Schyljoi district at the beginning of April. The discovery is already being described in Kazakh media as a "second Kashagan" - with the crucial difference that it is located on land and would therefore be significantly cheaper to develop than the technically challenging offshore field in the Caspian Sea. This point in particular is of considerable importance for Kazakhstan. While the existing Kashagan model is heavily influenced by previous production-sharing agreements, which only gave the state limited access to export revenues, Astana is likely to push for significantly more favorable conditions for new projects. New discoveries would therefore not only be a geological gain, but also a financial gain. However, the economic fantasy extends beyond individual production fields. With every new exploration project, the attractiveness of a trans-Caspian export corridor that could transport gas from Kazakhstan and Turkmenistan via Azerbaijan to Europe grows. Such a corridor would connect to the Southern Gas Corridor and link Central Asia more closely to the European energy markets. This perspective also appears to play a role within BP. Company representatives based in Azerbaijan are already talking about a possible new energy corridor, for which experience from existing projects in the South Caucasus could be used. This indicates that BP is not just focusing on individual fields, but is thinking of the region as an integrated new energy cluster. This opens up a new chapter for Central Asia. Ustyurt could develop from a remote border region into a geostrategic energy hub - provided that the hopes of geologists are actually confirmed in economically viable quantities. The post BP bets on Central Asia's gas reserves appeared first on ostwirtschaft.de.