Turkmenistan : final report -- NIS institutional based services under the energy efficiency and market reform project : contract no. CCN-Q-00-93-00152-00

Some of the obstacles are matters of fate and difficult, at best, to overcome. Turkmenistan"s location is far from hard currency markets and surrounded by competitor nations also rich in hydrocarbons. Other obstacles are within the small nation"s power to eliminate. Beginning in 1996, Turkmenistan embarked upon legal and regulatory reform to rid itself of its stifling legacy of Soviet-style legislation and petroleum industry institutions. A new Petroleum Law was adopted and became effective in March 1997. The concept of an industry-efficient "one-stop shop" was built into the structure of the new law, and a new agency -- the Competent Body -- was created outside of the old-guard institutions to implement the Law"s terms. For the past 18 months, USAID advisors have counseled the new institution, together with the remaining old guard institutions, on aspects of implementing the reforms contemplated by the law, and aspects of further refinement in the petroleum sector in general. Rules and regulations supporting the new Law have been drafted and are undergoing a review process. Accounting standards conforming to international standards are being drafted and promise to provide petroleum sector institutions with exact operating and investment disciplines. A process of analyzing and selecting national strategic options has begun, although much work remains. The highly fragmented structure of the governmental oil companies is inefficient and ineffective. The petroleum sector must be reorganized into a viable and competitive entity. The new Competent Body must be developed into a truly functioning regulatory body capable of coping with an international oil industry possessing technologies unlike anything heretofore seen within Turkmen boundaries. Accounting standards must become fixtures of workday practice. The nation"s strategic options must be sorted through, selected, and executed with a vision of better days ahead for the country. (Author abstract, modified)