MARY - Gas-rich Turkmenistan on Saturday hailed the expansion of a Soviet-era power plant that it hopes will become a hub for electricity exports to Afghanistan and Pakistan.

Speaking at a ceremony to mark the upgrade of the facility powered by gas and steam in the republic's southern Mary region, Turkmen leader Gurbanguly Berdymukhamedov said new capacities at the plant would allow the country to boost exports to "neighbouring countries".

The $1.2 billion expansion project would allow Turkmenistan to export an additional three billion kilowatt-hours per year to neighbouring countries, Berdymukhamedov said.

"In the future, we plan to build a gas turbine power plant on the Turkmen-Afghan border together with Japan's Sumitomo," he said.

Turkmenistan completed an upgrade of its largest electric power plant on Saturday, which it hopes will help boost exports and eventually allow supplies to Pakistan, which would require the construction of a new transmission line.

An employee in the energy ministry, speaking on condition of anonymity, confirmed to AFP the cost of the expansion, carried out jointly by Turkish firm Calik Holding and General Electric.

In addition to its current customers - Afghanistan, Iran and Turkey - Ashgabat plans to tap Pakistan's market by building a power transmission line through Afghanistan, where it is already laying a gas pipeline in the same direction.

Central Asian states are jockeying to supply electricity to potentially promising markets in Afghanistan and Pakistan. One project called CASA 1000, backed in part by the United States, would see electricity produced at hydropower plants in Kyrgyzstan and Tajikistan sent to the two countries.

For Turkmenistan, which sits on the world's fourth largest reserves of natural gas, electricity exports as well as trade and transit have assumed added importance as it struggles to find markets for its main export.

Planned gas pipelines to Europe and India have been slow to materialise despite years of negotiations plagued by political and economic doubts, while major buyer Russia ceased importing Turkmen gas in 2016.

Turkmenistan sliced a fifth off its manat currency in 2015 after the global hydrocarbons market dropped but black market estimations of the manat's value relative to the dollar are over six times lower than the official rate.