Russia's President Vladimir Putin (L) and Kazakhstan's President Nursultan Nazarbayev talk as they meet in Moscow, December 20, 2007.[Photo: Reuters]

A Caspian pipeline stretching from Turkmenistan to Russia will be built to transport Turkmen natural gas to Western markets, the Itar-Tass news agency reported Thursday.

An agreement on the construction of the gas pipeline, to be built along the Caspian Sea coast and pass through Turkmenistan, Kazakhstan and Russia, was signed in the Kremlin on Thursday. The construction will be completed in 2010.

"This is a very important event for the power industries of our countries and Europe," Russian President Vladimir Putin was quoted as saying in a meeting with his Kazak counterpart Nursultan Nazarbayev ahead of the signing ceremony.

Putin, Nazarbayev and their Turkmen counterpart Kurbanguly Berdymukhamedov agreed in May to build the pipeline, which is expected to have an annual capacity of 10 billion cubic meters by 2010 and could then increase to 30 billion cubic meters.

Turkmenistan, the world's No. 5 gas-and-oil rich country, is currently exporting gas via the Central Asia-Center pipeline that possesses an annual capacity of nearly 50 billion cubic meters.

The United States and the European Union have been trying to persuade Turkmenistan to ship gas past Russia via a proposed pipeline under the Caspian Sea.