Mike wood's presentation slides from the 2010 World National Oil Companies Congress that took place in June in London.

1. Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
© Gaffney, Cline & Associates
Overview of Caspian / Central Asian Region
Gas Supplies
Mike Wood
Gaffney, Cline & Associates

2. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Agenda
Somewhat Turkmen-focussed but Regional context
A look at some significant recent events
What are the opportunities for the future?
Alternative regional options / additions to Turkmen gas
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3. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 19623
Caspian Known Resources – 2007
BP Statistics
BillionCubicmetres

4. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 19624
Caspian Known Resources – 2008
BP Stats S. Yolotan (mid-case) and Shakh Deniz Ph 2
BillionCubicmetres

5. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Top Reservoir Full-Field depth map
Minara
S. Yolotan as Mapped in 2008
x
x
x
x
x
x
x

6. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Turkmenistan and the Recent Major Discoveries

7. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Current & Planned Gas Export lines
7
Central Asia Gas
Pipeline CAGP 30 BCM
(+10?)
Korpej-Iran
9 BCM,
Central Asia Europe
Pipelines CAE 50-70
BCM
Proposed Pricaspiysky Gas
Pipeline 10 + 10 BCM
Dovletabad-
Sarakhs-Khangiran
Proposed East
West Pipeline
10 – 30 Bcm

8. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Turkmen Production & Export – 2007/8
Production Capacity: ~70 Bcm/yr
Gas supply
–Russia: 45 Bcm/yr
–Iran: 7 Bcm/yr
–Domestic: 15 Bcm/yr
Total: 68 Bcm/yr
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9. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Turkmen Gas Production & Export
In 2009, export levels dropped significantly due to the
termination of supplies to Russia.
Export are understood to have resumed, but at much
lower levels. Production capability is unchanged.
Supplies to China have commenced – from
developments in the Amu Darya.
Production from South Yolotan is expected to
commence in 2014, at 30 Bcm per year, increasing at 10
Bcm per year to 2018.
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10. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Turkmenistan Gas Export Potential
10
0
20
40
60
80
100
120
140
160
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Bcm
Year
China
Iran
Russia
Domestic
Production Capacity

11. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
What enabled the ‘China’ project?
A Packaged arrangement:
It recognised all stakeholders (Kazakhstan, Uzbekistan &
Turkmenistan) - each has a 30 BCM/yr export contract
Included subsurface responsibility and facilities
Development
– Sales volumes part sourced from its Amu Darya PSA
– part from Turkmengas’s own resources (inc. S. Yolotan)
A pipeline brought to the door
All necessary funding
11

12. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Trans-Asia Gas Pipeline
12

13. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 196213
What would be required for European supply?
Development of 10-30 BCM/yr capacity on South Yolotan
- will take several years
Political agreement on a trans-Caspian route (involving
all parties).
Additional work on the Turkmen domestic pipeline
infrastructure – but East-West Line is approved by the
President.
A unified approach by the potential buyers including a
means of funding.

14. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
What are the Alternatives - Iraq
Recent Service Contract agreements in Iraq target 10
MMbbl / day within 7 years. The associated gas is the
property of the state.
After allowances for gas injection, 60 Bcm/yr of
associated gas production is possible - excluding any
non-associated gas production – target of the 3rd Iraq
License Round.
Current serious energy deficiencies - domestic power
generation is generally oil-fired – so consumption is
likely to grow considerably as gas becomes available.
14

15. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 196215
Iraq Energy Statistics
Gas consumption in 2007 was 1.4 Bcm - consumed by
industry. Electricity consumption in 2007 was 32 GWh
Oil is the prime fuel used for power generation. If
associated gas were to be used, it would consume 10
Bcm/yr. (at current levels)
According to the EIA there was 8.9 gigawatts of
installed power capacity in 2006 - equivalent to 26
Bcm/yr of gas. (assumed to grow to 30 Bcm)

16. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Potential Gas Exports
16
0
10
20
30
40
50
60
70
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
BCM
Year
Gas Production
Internal Consumption
Potential Gas
Exports 30 Bcm/yr ??

17. © Gaffney, Cline & Associates
Gaffney, Cline & Associates
Technical and Management Advisors to the International Petroleum Industry Since 1962
Regional Gas Supply Potential ??
17
20Bcm
20Bcm 20 Bcm
20 Bcm