China Launches First Leg of New Silk Road Project

China officially launched a behemoth $79.8 billion infrastructure project in its northwestern province of Gansu. The project, while beginning in Gansu, a region of China that shares no land borders with any Central Asian nation, is merely the starting point for a series of large infrastructure development projects which will encompass much of Central Asia. Chinese officials tout Gansu as an important “facilitator” of the Silk Road Economic Belt.

Development of the Gansu stretch of China’s New Silk Road policy is expected to last approximately six years, sprawl across 60,000 kilometers worth of road and drastically improve connectivity throughout the region. Tackling infrastructure problems internally is deemed by Chinese authorities as a necessary precursor to large-scale regional infrastructure development, and ultimately expected to smooth integration when projects scheduled for Uzbekistan, Tajikistan and Afghanistan come to fruition.

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News Briefs:

  • A crucial segment of Line D, a natural gas pipeline destined to further connect China with Central Asia, is underway, according to sources close to the project. The Uzbek segment will connect to a similar, 200 kilometer segment currently being constructed in Tajikistan. When completed, Turkmen natural gas will flow through the countries in route to Xinjiang province in Western China. Line D is the fourth of its kind, and will transport up to 85 billion cubic meters of natural gas.
  • Central Asia-focused oil and gas firm Tethys Petroleum announced the signing of a memorandum of understanding with China’s PetroChina. The MOU commits Tethys’s Kazakh subsidiary, Tethys Kazakhstan SA, and PetroChina to exploring possible natural gas and crude oil reserves. Under the terms of the agreement, Tethys will explore with the hope of finding and subsequently exporting natural gas and oil to China, as well as within Kazakhstan. It’s unclear how revenues will be divided by the two firms.
  • Russian energy giant Gazprom’s oil arm, Gazprom Neft, announced that its net profits in 2014 decreased by 32%, and that its 2014 revenues increased by 12%. Gazprom Neft is known for being the only Russian company currently operating in the Arctic, and controls Russia’s only Arctic offshore deposit.
  • Intelligence services in Kyrgyzstan announced that they have begun to see the influence of Islamic State in southern Kyrgyzstan. Kyrgyzstan’s national security service, known as the GKNB, claims to have detained a “large number” of individuals on suspicion of partaking in terrorist activities. The GKNB recently detained a group of six men who they accused of planning attacks in Kyrgyzstan and Uzbekistan after undergoing military training in Syria.
  • The proposed Trans-Eurasian Information Super Highway project was recently discussed at the Russian communication ministry in Moscow. Russian entities including Rostelecom, TransTelecom and MTS all sent representatives to discuss the project’s viability. The network, which has yet to make progress despite significant initial amounts of optimism, would create a telecommunications network that would span Eurasia. According to Russian sources, this could be accomplished by overland networks that would traverse China, Europe, Kazakhstan, Azerbaijan and Turkey, or via an underwater network connecting Kazakhstan and Azerbaijan.
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