The World Bank's latest report on "Achieving Carbon Neutrality by 2060" highlights concerns about the looming imbalance between gas supply and demand in Central Asian countries.
World Bank experts have noted a trend of rising fuel consumption coupled with declining gas production volumes, particularly in Uzbekistan and Kazakhstan. This dual dynamic is expected to pose challenges in meeting both domestic demand and fulfilling gas export obligations, especially during the winter months.
Potential Solutions
In response to these challenges, Russia has proposed a gas union involving Kazakhstan and Uzbekistan, aiming to address the imbalance in gas supply and demand across the Central Asian region. While this proposal holds potential benefits, the World Bank has highlighted certain uncertainties surrounding it. These uncertainties include concerns about the condition of pipeline infrastructure and the reliability of gas supplies from the Russian Federation.
Despite the challenges, there are potential avenues to mitigate the risk of fuel shortages in the region. One such solution involves increasing gas purchases from Turkmenistan, as well as exploring opportunities for regional gas supplies.
Turkmenistan produced 80.6bn m³ of natural gas in 2023 and exports surged by 12.6% in January-December 2023.
Uzbekistan Gas Production Data
Recent data from the Statistical Agency of Uzbekistan underscores the severity of the situation. Gas production in Uzbekistan witnessed a decline to 3.9bn m³ in January of this year. This downturn follows a larger trend, with gas production in 2023 totaling 46bn m³, marking a 9.4% decrease compared to the same period in 2022.
Kazakhstan also produces a significant amount of gas. The country's natural resources reach up to 2.7 trillion m³ and the annual production is at 89.9mn metric tons as of 2023.
Earlier, it was reported that Uztransgaz, the operator of Uzbekistan's gas transportation system, is set to embark on a significant modernization initiative aimed at enhancing the country's gas imports from Russia. The initial project budget is projected at $470 mn, with implementation scheduled to commence in 2024 and continue until 2030 and will focus on upgrading the main gas pipelines to facilitate increased imports of natural gas from Russia.
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