INTERVIEW: Transit of Russian gas through Kazakhstan: opportunities and challenges

By Asif Aydinli

News.Az presents an interview with Saken Mukan, a Kazakh political scientist and professor at the Department of Media Communication and History of Kazakhstan at MUIT JSC.

- What are the main benefits for Kazakhstan from the implementation of the project to supply Russian gas to China through its territory, and what conditions is Kazakhstan proposing to participate in this project?

- First, following the challenges with the Caspian Pipeline Consortium (CPC), the Kazakh government has taken steps to further diversify the export of hydrocarbons to global markets. Leveraging its transit potential, Kazakhstan sought common ground with Russia to facilitate the transportation of hydrocarbons. In particular, Kazakhstan participated in the "Center—Central Asia" gas pipeline project in 2023, through which Gazprom exports gas to Uzbekistan, as well as the project to transit Russian gas to China via Kazakhstan.
Second, the geopolitical reality is that Kazakhstan plays a key role in Central Asia, efficiently utilizing its transit potential. This aligns with modern energy market demands and supports strategic initiatives such as the "Belt and Road" initiative (BRI).

Third, by providing Russia with the opportunity to transit gas through its territory, Kazakhstan gains additional leverage to maintain its hydrocarbon export routes to the European market. This minimizes the politicization of the CPC route, which is a crucial condition for Kazakhstan's strategy.

- What steps is Kazakhstan planning to take to negotiate the fundamental parameters of this project with Russia and China, given its strategic significance for the region?

- Firstly, pricing is a critical issue for Kazakhstan. For China, a competitive gas price is essential, and Russia, given the current circumstances, can offer lower costs compared to Kazakhstan. In this context, Kazakhstan is willing to consider "price concessions" in exchange for expanding its presence in the European market. This positioning makes Kazakhstan an attractive alternative energy supplier for Europe.

Secondly, the visits of German and French leaders to Kazakhstan underscore the republic's strategic importance as a partner for Europe. Kazakhstan plans to leverage this project to maximize benefits by insisting on conditions that ensure the uninterrupted operation of the CPC, as well as fair conditions within the Eurasian Economic Union (EAEU). Kazakhstan is striving to eliminate double standards and unfair competition within the organization.

- What steps is Kazakhstan taking to increase natural gas exports to China, considering competition with Russia and Turkmenistan, and what are the prospects for building a new cross-border gas pipeline?

- Currently, progress in this direction remains limited. Russia offers China cheap gas, creating unfavorable conditions for Kazakhstan's gas exports. However, existing pipelines between Kazakhstan and China operate under long-term agreements that remain in force, ensuring the stability of their cooperation.

Amid competition with Russia and Turkmenistan, Kazakhstan is focusing on developing domestic consumption and expanding pipeline infrastructure to meet internal needs. Chinese investors are actively involved in this effort.

As for the construction of a new cross-border gas pipeline, negotiations have been ongoing for a long time. However, the parties currently maintain the status quo. The reasons include the high cost of the project and geopolitical uncertainty, which make such initiatives less attractive. The stakeholders prefer to develop bilateral agreements rather than multilateral formats.

News.Az