Turkmenistan has all but ruled out exporting its huge natural gas resources to the west or to Russia. That’s a big win for Beijing in the strategically critical race for Central Asian’s huge gas resources.

China took the lead as Turkmenistan’s favorite energy partner some time ago, but Ashgabat has signaled it wants to further tie its future to the east, instead of north or west. Last week, state television announced the government would seek a $4.1 billion Chinese credit, apparently on top of the $4 billion credit it agreed to last year, under conditions tied to long term gas supplies.

But in a somewhat surprising move, the government also identified Chevron, ConocoPhillips, and TXoil, a Texan startup chaired by a brother of former President George W. Bush, as the preferred bidders for two off-shore concessions in the Caspian Sea.

Together, Ashgabat is signaling it is eager to give foreign companies access to its off-shore sector, but its prized onshore gas reserves will continue to be developed mainly by China, dashing western and Russian hopes to secure those supplies.

The country’s huge gas supplies, the world’s fourth-largest at almost 290 trillion cubic feet, have for some time attracted bidders not just in the production side, but the distribution and supply sides. Europe wants it to diversify away from its dependence on Russian supplies; Moscow wants it precisely to tighten its grip on European supplies, and Asian countries, especially China, need it to fuel their growing economies.

The offers stacked up, but the competition was basically between filling the proposed Nabucco pipeline, increasing exports to Russia, or shipping to eastern markets. Europe has been unable to commit, namely over disputed claims over Caspian waters making the pipeline a non-starter, while Russia has been unable to compete with Chinese economic might.

In the meantime, China has been nestling in the country, delivering on its promises, armed with what Russia and western governments lacked: cash. Within three years, it completed a nearly 1150-mile pipeline from Turkmenistan, through Uzbekistan and southern Kazakhstan, into Xinjiang in China. Exports started this year, giving Ashgabat a second route and powerful leverage in negotiations with Moscow. Until last year, just about all of its gas exports went to Russia, but new production is now being exported to China through the new pipeline under a 30-year contract to eventually export 1.4 tcf annually to China.

China also got Turkmenistan’s most sought-after prize: the South Yolotan field, believed to be the fifth-biggest in the world, with at least 140 tcf of resources in place. Last year, China became the first country to be given access to onshore fields, after it agreed to lend Turkmenistan around $4 billion to develop the first phase of the huge field, hedged on long term gas supplies.

The new loan request is reportedly to finance the second phase of South Yolotan. The field could eventually produce as much as 700 bcf annually, although some doubt the country’s ability to develop its gas resources on time to meet supply contracts with China, Iran, and Russia.

“South Yolotan gas, if and when it gets developed, will go to China or Iran. I would be highly suspicious this gas will go west, despite of western efforts, until there is a western commercial champion with an onshore concession, and I just don’t think that is on the table,” said Edward Chow, a senior energy fellow in the Center for Strategic and International Studies.

Western companies so far have only had access to off-shore fields with mixed results. Ashgabat’s unusual public announcement that US companies had been shortlisted to bid for two blocks could signal a bigger role for western companies, but it is by no means a big concession, analysts agree. “The Turkmenistan position for a long time has been that they don’t need foreign investors onshore, with the exception of China. But companies are interested in off shore because they are more interest in oil than gas. ConoccoPhillips and Chevron think that if they get involved and develop a relationship, that it might lead to big gas onshore, not offshore,” Chow said.

Turkmenistan’s favoritism toward China is rooted in the economics. “What is certain is that both sides like this relationship and they want to develop it. It makes sense economically not just because Turkmenistan needs money and China can offer it in exchange for gas, but also because of the technical assistance that Chinese can provide and the contracts that Chinese companies are getting. And for Turkmenistan, China is an ideal counterweight for Russia,” said Simon Pirani, senior research fellow at the Oxford Institute for Energy Studies.

Russia is perhaps the biggest loser from China’s inroads in Turkmenistan. Last year, Moscow tried renegotiating long-term supply contracts that it had agreed to years back to pay market prices for the gas, which until then Turkmenistan had been forced to sell at a steep discount. To pressure Ashgabat, Gazprom delayed fixing the main Turkmen gas import pipeline, denying the country about $1 billion monthly in revenue.

The pipeline was eventually repaired and a new contract was signed, but Turkmenistan grew even more wary of increasing gas supplies there, especially since China and Iran are willing to pay market prices, without attaching conditions as western and Russians. Russia imported only around 350 bcf last year, compared to 1.7tcf in the past, and it is not expected to import more than 1 tcf under the new agreement.

And while it’s true that Turkmenistan will not alleviate European dependence on Russian gas, the bargaining power of Moscow has not only been undermined with Central Asian countries by the new export route, but also with China, which now has a stronger hold than ever in the region.