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Business

Japan, Turkmenistan sign huge deals

The two countries are teaming up to tap the world's fourth-largest natural gas reserves. Japan may be late to the game in Turkmenistan, but its engineering expertise might just help it gain a foothold on the hot market.

Japan and Turkmenistan on Friday signed a raft of deals, ranging from natural gas to chemicals, worth more than $18 billion (16.4 billion euros).

One of the biggest agreements saw engineering giant JGC join a large-scale cooperation to build a plant linked to natural gas fields. This makes it the latest Japanese company to help Turkmenistan convert its vast natural gas reserves into anything from plastic to liquid fuel and fertilizers.

"Government bodies and private companies of Japan, as a united team, will work as much as possible with Turkmenistan with the goal of reaching a new milestone in its industrial development with the active use of natural gas," said Japanese Prime Minister Shinzo Abe, who was accompanied by a delegation of business representatives on his week-long tour of five Central Asian states.

Friday crowned the first-ever official visit by a Japanese leader to the reclusive, ex-Soviet country, and comes at a time when the race to tap the Central Asian nation's energy resources is heating up.

The scramble for Turkmenistan

Turkmenistan produces around 70 billion cubic meters of natural gas every year, with roughly two-thirds of its exports going to Russia's Gazprom. In recent years, however, Ashgabat has sought to reduce its reliance on Moscow. China is now well on its way to overtake Russia as Turkmenistan's leading trading partner, importing up to 35 billion cubic meters of gas annually.

Japan, for its part, has been most successful in gaining a foothold on the energy-rich market through its expertise in engineering and technologies. On Friday, Turkmen President Gurbanguly Berdymukhamedov assured his visitors that their services are badly needed.

"Turkmenistan is interested in acquiring Japan's experience in creating and using technologies," the 58-year-old ruler said.

Japanese companies have reportedly also expressed an interest in investing in an ambitious 1,800-kilometer (1,118-mile) pipeline, transporting gas from Turkmenistan to energy-hungry India, Pakistan and Afghanistan.

pad/hg (AFP, Reuters)