Turkmenistan to cut EU dependence on Russian gas

Ms Ferrero-Waldner described the deal as "a very important first step" in energy cooperation, although she acknowledged the amount agreed by the two sides does not represent a "vast quantity".

The former Soviet Republic in Central Asia has the world's fifth largest reserves of natural gas and substantial deposits of oil. It annually produces 60 billion cubic metres of natural gas, but two-thirds are exported to Russia's state-run Gazprom.

Demand for energy is sharply rising in the European Union. By 2020, it is expected to import at least 360 bcm - out of 500 bcm consumed - from third countries.

The 27-nation bloc has been trying to diversify its energy supplies away from Russia and is currently pushing for a new energy corridor, the Nabucco pipeline.

The pipeline - connecting Turkey with Austria, via Bulgaria, Romania, and Hungary - would enable the transportation of Caspian energy resources to the European market. Main gas supplies could come from countries such as Azerbaijan, Kazakhstan, Turkmenistan or Egypt.

Speaking about the fresh deal with Turkmenistan, Ms Ferrero-Waldner called on European business to invest in infrastructure in order to bring the project to life.

It is still unclear how Turkmen gas will be imported to Europe, with the commissioner suggesting three possible short-term scenarios in the interview with the Financial Times.

Under the first one, a 60-kilometre gap between Azeri and Turkmen offshore installations could be closed with a mini-pipeline.

Secondly, an onshore link to Kazakhstan could be built to connect with a route to Azerbaijan.

Under the third option, the gas could be compressed into liquid form and taken by tanker across the sea.