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The Energy Charter: Providing security of transit for Turkmenistan

The Central Asian Republic of Turkmenistan possesses very substantial gas reserves and has ambitious plans for their production and export. However, "the realisation of Turkmenistan's vast potential as an exporter of hydrocarbons is largely dependent on the transit of its energy through the territories of neighbouring countries," stated Ambassador André Mernier, Secretary General of the Energy Charter Secretariat, at a high level investment conference in London "Oil and Gas in Turkmenistan" on 17-18 April 2008.

Speaking during a panel session on 'Alternative Export Routes', the Secretary General stressed that it is particularly important for landlocked countries like Turkmenistan "that a common set of rules governing transit issues is in place in order to secure transit for their energy exports and ensure their uninterrupted flow across national borders to international markets." This is clearly an area where the legally binding Energy Charter Treaty can assist, particularly through its existing provisions on transit contained in Article 7. These are based on the principle of 'freedom of transit' and aim to secure reliable cross-border energy flows within the Treaty's constituency.

No less important for major resource owners such as Turkmenistan, however, is the fact that the Treaty's binding disciplines protect long-term energy investments, particularly those into transport infrastructure. These in turn provide legal security for long-term supply agreements and protect the interests of energy-producing, transit and consuming states alike. Indeed, several of the major gas and oil pipeline projects linking Central Asian energy resources through the Caspian to international markets were drawn on principles contained in the Energy Charter Treaty.

Turkmenistan is one of 51 member states of the Energy Charter Treaty, which is the only multinational legal instrument applying specifically to the energy sector.