Iran, with the second largest natural gas reserve in the world, accounts for more than 17% of the known deposits. However, the share of our country in global gas trade is meager.
At present, converting this valuable underground asset into a productive wealth on the ground is one of the biggest concerns of countries with gas reserves. In other words, by extracting and supplying this product to the world market, foreign exchange revenues needed for large development plans will be provided. Therefore, the process of extracting and supplying such wealth is like liquidating national assets; such a wealth cannot create jobs and increase income as long as it is hidden underground.
Nasser Zakeri, an economist, opened his article published by the Persian daily Shargh with this note. A translation of the text follows:
Undoubtedly, grabbing a share of the global gas market requires preparations and huge investments for completing pipelines and putting equipment in place. The export target country will be willing to cooperate with a supplier that can be relied upon for long-term partnership.
Some may argue that being content with a small share in the market is a step toward preserving the wealth of future generations, but this is not a good justification. Failing to increase the country’s share in the market takes away the opportunity to generate a valuable asset for the current and future generations, and does not allow them to accumulate wealth using this asset. That is why other countries with large natural gas reserves are increasing their shares in the market and work to turn this valuable non-productive underground asset into a productive asset.
Over the past few years, the global gas market has seen important developments. Qatar, the third largest holder of gas reserves, has established its place as a reliable supplier and long-term partner in the market.
The process of extracting and supplying such a natural wealth is like liquidating national assets that cannot create jobs and increase income, as long as it is hidden underground
With the help of large companies and their modern technologies, Qatar has extracted more than its share of common border reserves. The plan to build the Peace Pipeline, which was designed to transfer Iranian gas to the Indian Subcontinent, was undermined by Iran’s enemies. In turn, the TAPI pipeline, which will transfer Turkmenistan’s gas to India and Pakistan, has served the common interests of the three countries and the Taliban, and brought them to the negotiating table. It should be noted that Saudi Arabia has also invested in this project with the aim of creating restrictions for Iran’s gas industry.
As Europe was not sure about the continued supply of Russian gas, Turkmenistan, which only has one-third of Iran’s reserves, took the opportunity and carried out the gas pipeline project from the Caspian Sea to claim a larger share of the global gas trade. This country did not even agree to partner with Iran and use its soil to transfer its gas.
All in all, Iran missed the opportunity to play a role in the global gas trade. In a situation where gas customers buy the product from a reliable partner via established pipelines and infrastructure, they will not be willing to partner with Iran, which does not have adequate infrastructure for gas transmission.
In addition, the unprofessional moves by some senior officials, including withdrawal from oil swap agreement with Turkmenistan during the government of Mahmoud Ahmadinejad, have made our country appear unpredictable for gas customers. In fact, our country’s distinct view of global politics has presented a pessimistic image of Iran among potential economic partners.
One of the highest priorities of a country that has one of the largest gas reserves should be to have a strong presence in the global gas market for promoting national development. It should attract big customers and start economic cooperation with them as a reliable partner.
Apparently, today, the need to include national interests in the principles of foreign policy is not the priority of Iranian policymakers. Although the government is pursuing State Assets Monetization Plan, it is not thinking about monetizing a valuable asset called natural gas. As a result, Iran will have to wait for the end of Turkmenistan’s reserves during the next five decades to “monetize” its own gas reserves.