Energy

Iran attempts to spin major ruling on gas payments to Turkmenistan

By Dzhumaguly Annayev

image

Iranian President Hassan Rouhani (left) and his Turkmen counterpart, Gurbanguly Berdymukhamedov, take part in a joint news conference in Ashgabat March 11, 2015. The International Court of Arbitration in June ordered Tehran to pay Ashgabat $2 billion over a gas dispute. [Igor Sasin/AFP]

ASHGABAT -- The Iranian regime is attempting to spin a ruling that the International Court of Arbitration (ICA) handed down in favour of Turkmenistan in a long-running natural gas dispute with Iran.

The court on June 24 ordered Tehran to pay $2 billion (7 billion TMT) to Ashgabat for failing to pay for gas it received from Turkmenistan from 2007 to 2013, Radio Free Europe/Radio Liberty (RFE/RL)'s Turkmen service reported, citing Iranian sources.

The ICA itself did not disclose its verdict.

However, on July 3, Kasri Nouri, spokesperson for the Iranian Ministry of Petroleum, told the Iranian publication Entekhab that there was no such ruling, and on a tweet the same day, the ministry said in fact Turkmenistan had been fined for the quality and quantity of the delivered gas.

Longstanding dispute

Iran imported gas from Turkmenistan via the Korpeje–Kordkuy pipeline, which runs from the Korpeje field in western Turkmenistan to Kordkuy in Iran, starting in 1997, according to Maisa Agayeva, an auditing specialist for Turkmenistan's Ministry of Finance and Economy.

The volume supplied rose from 4 billion cubic metres in 2001 to 5.8 billion cubic metres in 2005.

"The parties had already nearly agreed to increase supply volume to 14 billion cubic metres per year, but Iran thwarted these plans with its delayed payments," Agayeva said.

In response, Turkmenistan suspended its deliveries and demanded a higher price for its gas. The Iranian regime agreed to the new terms but then refused to meet its obligations. The Korpeje–Kordkuy gas pipeline has been sitting idle since January 2017, according to Agayeva.

"Iran showed itself to be an unreliable partner from the very beginning," said a senior manager at state-owned Turkmengaz on the condition of anonymity.

"When they [the Iranian authorities] needed Turkmenistan's gas during the winter, they were ready to do anything, but as soon as the situation changed, they started to look for reasons not to pay for the gas," he said.

"Iran's claims, which make allegations about the quantity and quality of the gas it got from Turkmenistan as the reason why payments didn't go through, were far-fetched," the official said.

Turkmenistan had long been trying to collect payment, but its patience ran out and the Iranian government dug in its heels, he added.

"So then, on the orders of President [Gurbanguly] Berdymukhamedov, starting on January 1, 2017, we stopped supplying gas to our insolvent partner, and in August 2018 we sued them, and now we've won the case," he said.

Iranian disinformation

While Turkmenistan's government has yet to issue a statement on the decision by the ICA, the Iranian regime immediately began circulating contradictory information about the ruling.

Earlier, Iran's Ministry of Petroleum announced that the ICA had issued a ruling, while acknowledging that under "the rules of arbitration, this decision cannot be disseminated by any of the parties to the dispute, except with the agreement of the parties".

"This commercial lawsuit has no winner or loser," the ministry claimed as well.

At the same time, Press TV, an Iranian state-run media outlet, reported on June 29 that Iran had paid a fine to Turkmengaz.

Other media coverage gave a lower figure for the funds owed to Turkmenistan.

These contradictions in the coverage of the court's decision appear to be an effort to put "a good face on the matter", said Agayeva the auditor.

"All this confusion after the arbitration decision that was already handed down highlights the fact that Iran, true to form, will procrastinate on complying with the court's ruling," Agayeva said.

"Turkmenistan is hoping that after this arbitration ruling, the gas conflict between the two countries will end and a new stage in the development of relations with Iran will begin," Agayeva said.

"But only Allah knows how the authorities in Tehran will behave," she said.

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