The agreement with China dates from 2006, but the two specified gas pipelines have not been built. The reason, according to Russian sources, appears to be failure to agree on the gas price. With regard to the new terminals, it is true that the country now has the Sakhalin plant, but the Baltic project (near to St Petersburg) has not yet materialised. The proposed terminal on the Yamal Peninsula also needs a push. This is a supplement (or alternative?) to the expansion of the connection networks from the deposits on this peninsula to Central Europe.

The Caspian gas pipeline will traverse Turkmenistan and Kazahkstan, travelling around the great inland sea. It is very likely to have a branch to Uzbekistan. The planned length is 510 Km, and its initial capacity will be 12 bcm, rising to 30 bcm in 2017. The present gas pipeline joining these countries, used to export to Russia and the Ukraine (operating since 1967) does not have enough capacity for the production targets of these Caspian Sea nations.

Iran has been developing infrastructures over the last few years to start selling gas from the South Pars field. Referring here to the NIOC LNG, they expect to build an LNG terminal, among other projects, on Tombak island. Its capacity would be two trains of 5 million tonnes/year, and it could be operational in 2010. Another project is the Pars LNG, with the same capacity. Foreign companies are involved in it, and it would also be situated on Tombak island. A third project we must mention is the Persian LNG, in which Repsol and Shell each have a 25% holding. The intention is start regasifying in 2011, although Repsol has not yet finally confirmed its participation.

Elsewhere, Iran has requested new clauses (payment revision every three years) in relation to the gas pipeline which is planned for construction between this country, Pakistan and India. There is an agreement in principle after many years’ efforts, but the firm decision to invest has still not been taken. The cost would be about 7,400 million dollars, and it would initially transport 60 bcm/year, shared equally between Pakistan and India. The news in January 2008 is that India is still not sure about this alternative. There could be several reasons for this indecision: pressure by the USA, the charges India would have to pay Pakistan or the possibility the former might go for nuclear energy to produce electricity.

Finally, the Nabuco Project is an option to carry gas from Iran (South Pars deposit, in the Persian Gulf) and Turkmenistan to the heart of Europe. As is well known, this has been on the table for several years and there is still no final approval of the investment. There are several reasons. One is that there are too many states and companies involved, due to its length. Another is that the Russian government sees it as an infrastructure which would compete with the export policy it has followed since the collapse of the USSR: the gas from the countries which were part of that Union is still being exported to Europe via the Gazprom network, after purchase by this company.

The great sub-continental country’s short-term plans include making natural gas available to as much of the population as possible. The construction of 5,000 km of new gas pipelines and taking the gas to 230 cities are targets set for achievement by 2011.

After the doubts raised over the gas price in 2006, the Hazira terminal finally came into successful operation in 2007. The increased deliveries were significant, and the ‘demonstration effect’ is becoming a fact among the Indian factories. The high oil derivative prices are also helping in this task.

During the last quarter of the year, the Chinese government announced it had approved the construction of a second gas pipeline across the country, to link the northwest (Xinjiang) with the east coast. It will be 7,000 km long, the distance to the border with Kazahkstan. This new pipeline could be used to transport gas from the countries bordering the Caspian Sea across China.

The LNG export capacity of Qatar will increase significantly in 2008. The first boost will come in the summer, when the first train in the Qatar II project comes into operation. The second train will be operational at the start of 2009, but before this the RasGas train 6 will come into operation in the last quarter of 2008.

The first Yemen LNG train will be working at the end of 2008, on schedule. A second train could be operational by mid-2009.