Turkmens to Start Building Pipeline to Russia This Year

ASHGABAT, Turkmenistan -- Turkmenistan will start building a new gas pipeline to Russia as soon as this year after Moscow agreed to pay more for exports through an existing route, Turkmen state media reported Wednesday.

The agreement on the Russia-backed Caspian Gas Pipeline linking Turkmen gas with global markets via Russian territory has been delayed because of a pricing dispute since September.

"It has been agreed that the project should be launched before the end of the year," the state-owned Neutral Turkmenistan newspaper reported.

Gazprom agreed to raise the price it pays for Turkmen gas to $130 per 1,000 cubic meters from $100 in the first half of 2008.

Turkmen President Gurbanguly Berdymukhammedov met Gazprom chief executive officer Alexei Miller on Tuesday.

"The Turkmen leader and the chief executive of Gazprom have stated their intention to speed up the construction of the new route," Neutral Turkmenistan wrote.

The Russia-proposed pipeline would have a capacity of 10 billion to 20 billion cubic meters per year. It rivals an alternative route to Europe across the Caspian Sea that bypasses Russia.

Turkmenistan, which currently exports most of its gas through Russia, is also working on a separate pipeline to China.

Some analysts have questioned the country's ability to go ahead with so many projects at once.

However, Turkmenistan has countered by saying that it has enough gas reserves for everyone.