Turkmenistan, with its vast hydrocarbon reserves, stands as a focal point for the global energy community. The country’s significant resource potential, encompassing both onshore and offshore areas, presents unparalleled opportunities for foreign investment in its oil and gas industry. In a keynote speech at the International Forum on Attracting Foreign Investments to Turkmenistan’s Economy (TEIF 2025), Guvanch Agajanov, Chairman of the State Concern “Turkmennebit” (Turkmen Oil), highlighted the nation’s strategic vision and investor-friendly policies aimed at unlocking its hydrocarbon wealth.
Turkmenistan has substantial reserves in the Turkmen sector of the Caspian Sea, estimated at 18.2 billion tons of oil equivalent. This includes 12.1 billion tons of oil and 6.1 trillion cubic meters of natural gas. These reserves position Turkmenistan as a key player in the global energy market, offering opportunities for the development of offshore blocks and the extraction of hard-to-reach oil in mature fields. The country is also focused on adopting innovative technologies to modernize and optimize its oil and gas operations.
A primary focus for investment is the development of hydrocarbon resources in the Turkmen sector of the Caspian Sea. Since 2016, the State Concern “Turkmennebit” has been authorized to negotiate agreements for offshore license blocks under Turkmenistan’s hydrocarbon resources law. This legislation provides a flexible framework for various types of agreements, including:
- Production Sharing Agreements
- Concession Agreements (on royalty and tax terms)
- Joint Venture Agreements
- Risk Service Agreements
The law also allows for combinations of these agreements or other models prevalent in the international oil and gas industry, ensuring adaptability to investor needs. Agajanov emphasized that blocks 11, 12, 16, 21, and 23 are open for investment partnerships, each supported by comprehensive geological data to facilitate informed decision-making.
Turkmenistan’s legal framework is designed to provide robust guarantees and incentives for foreign investors. Key benefits include:
- Simplified Fiscal System: Investors are subject to only one type of tax—income tax—along with two to three payments for natural resource use. All other mandatory fees, duties, and payments are exempted.
- Freedom of Resource Disposal: Investors can freely manage their share of hydrocarbon resources, both within Turkmenistan and abroad, including processing oil at refineries without additional taxes or licensing requirements.
Beyond exploration and production, Turkmenistan is advancing its oil refining and petrochemical sectors, with the Turkmenbashi Oil Processing Complex at the forefront. As the largest refinery in Central Asia, the complex produces a wide range of products, including gasoline, aviation kerosene, diesel fuels, technical oils, liquefied gas, polypropylene, furnace oil, and construction and road bitumen.
The refinery has undergone significant modernization, with investments totaling US$2 billion. These efforts focus on introducing cutting-edge technologies, improving product quality, enhancing competitiveness, and ensuring compliance with international standards.
The State Concern “Turkmennebit” invites international partners to explore the opportunities in the Caspian Sea blocks and contribute to the nation’s vision of becoming a leading energy hub. ///nCa, 24 April 2025