Turkmenistan has halted gas flow to Iran, the Iranian Oil Ministry’s Shana news agency reported January 1.
The news comes just one day after Iran’s Deputy Oil Minister Hamidreza Araqi said the country’s deal for gas import from Turkmenistan will stay in force for five years.
Speaking after a trip to Turkmenistan where they prevented an outage of gas supply from the neighbor country over dispute on due payments, Araqi said both countries are bound to observe the deal.
Turkmenistan claims Iran has to pay $1.8 billion due payment for gas it received in 2007-08. Iran denies the claim. In that year Turkmenistan reportedly increased the gas price for Iran from $40 to $360 per thousand cubic meters, despite a 20-year deal.
In the evening of December 30 after much speculation about the outcome of the meeting, news outlets reported Turkmenistan had agreed an MoU on gas exports to the Islamic Republic of Iran which meant the country's gas exports to Iran would continue.
Iran was preparing to meet the situations if Turkmenistan halted the supply of gas on December 30. The supply is vital to the domestic sector in some provinces in northern Iran.
The National Iranian Gas Company in an announcement asked the residents of northern Iranian provinces, whose gas used to be supplied from Turkmenistan, to economize on gas so that they will not face a shortage of supply in the cold winter days.
Turkmenistan exported about 25 million cubic meters per day (mcm/d) of gas to Iran in 2015. According to Araqi Iran was recently receiving only 12 mcm/d of Turkmen gas.