The organization, which comprises Russia, China, Uzbekistan, Kazakhstan, Tajikistan and Kyrgyzstan, and has Iran, India and Pakistan as observers, accounts for an estimated 50% of the world's proven gas reserves. Energy hungry China is also the world's second largest energy consumer.
Russian President Vladimir Putin proposed in June creating an energy club within the organization to coordinate supplies and balance interests of both producers and consumers.
Iran's president also suggested at the same time that Tehran and Moscow should determine global natural-gas prices and main pipeline routes, triggering concerns in the West that a gas version of the OPEC oil cartel could appear in the region.
Founded in 2001, the SCO originally dealt with security and confidence-building issues, but has broadened its priorities to include economic cooperation as well as transportation, disaster relief and cultural projects.
The prime ministers said in a news release after a meeting Friday that Kazakhstan and Russia, two of the biggest crude exporters outside OPEC, would draft proposals for a meeting of fuel and energy experts in 2007. Apart from having the world's largest reserves of natural gas, Russia also has around 8% of global uranium reserves, though neighboring Kazakhstan has more than three times the amount at between 25% and 30% of the reserves.
The premiers ordered a working group to step up projects in information technology and telecommunications, and selected pilot projects to improve transport infrastructure in the region. They also said more intensive work should be conducted on a customs agreement.
The premiers adopted the organization's budget for 2007 and pledged to continue drafting agreements to protect and encourage mutual investment, the news release said.
