Monday, August 29, 2016


Qishloq Ovozi

Still One Big Obstacle To Turkmen Gas To Europe

A natural gas pipeline by the Caspian Sea in Turkmenistan (file photo)
A natural gas pipeline by the Caspian Sea in Turkmenistan (file photo)

The Caspian Sea is a sea of peace and friendship.
 
Top officials in the five Caspian littoral states -- Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan -- have been repeating that line for two decades.
 
This mantra is about to be put to the test.
 
Maros Sefcovic, vice president of the European Commission in charge of energy union, was just in Turkmenistan for talks on building the Trans-Caspian Pipeline (TCP), an idea that has been knocking around for two decades.
 
The roughly 300-kilometer pipeline would link Turkmenistan, a country with the world’s fourth-largest gas reserves, to Azerbaijan, the Caspian region’s gateway to Turkey and, farther, to Europe.
 
Sefcovic emerged from his May 1 meeting in Ashgabat with Turkmen and Azerbaijani officials saying that they had a "mutual understanding” and added that “Europe expects supplies of Turkmen gas to begin in 2019.”
 
The agreement represents a huge breakthrough, but it comes at perhaps the worst time possible during the last 20 years.
 
The European Union is anxious to decrease imports of gas from Russia. Currently, Russia sends somewhere between 140 to 150 billion cubic meters (bcm) of gas annually to the EU, about 30 percent of the EU’s total gas imports. The situation in Ukraine, where Russia has illegally annexed the Crimean Peninsula and is accused of supporting pro-Russian separatists in eastern Ukraine, has given the EU motivation it never had before to curtail gas supplies from Russia.
 
Part of the EU plan to replace Russian gas is to open the Southern Gas Corridor linking the Caspian Basin countries, primarily Azerbaijan and Turkmenistan, to Europe by pipelines through Turkey. Construction of the Trans-Anatolian Pipeline (TANAP), with an eventual capacity of some 60 bcm, started in Turkey in March.
 
So Russian state-controlled company Gazprom stands to lose roughly one-third of its current share of the EU gas market if TANAP is completed and filled (Turkey will receive six to 10 bcm). In recent years Gazprom’s revenue has filled some 25 percent of the Kremlin’s coffers. (And in April, the EU announced formal charges against Gazprom for violating EU business regulations.)
 
Georgia would also receive a big economic boost from transit fees for Azerbaijani and Turkmen gas transiting its territory -- something that also won't sit well with Moscow.
 
Russia has opposed the TCP project since it was first articulated. Russia has always argued that the status of the Caspian Sea is not yet clear. Several summits and dozens of lower-level meetings between officials from the five littoral states have still not produced a consensus on whether the Caspian is a sea, in which case all five countries have their own sectors to develop as they wish, or a lake, in which case the Caspian should be developed mutually and the profits split equally among the five.
 
Russia has also expressed concerns about the possible environmental consequences of a pipeline running across the Caspian Sea bottom.
 
Azerbaijan, Turkmenistan, and the EU have been working on their counterarguments for a half-decade. It starts with Baku and Ashgabat noting the pipeline only passes through their territorial sectors and accordingly does not require the consent of the other littoral states. They will point out every Caspian state has already been developing gas and oil fields in what would nominally be their national sectors of the sea, without any decision on the Caspian’s status.
 
Technically, construction of the TCP is no more difficult -- and according to some much easier -- than building the Blue Stream pipeline across the bottom of the Black Sea. Russia built Blue Stream and uses it to supply Turkey with gas, and Moscow is currently pitching construction of another, bigger pipeline -- Turkish Stream -- to boost supplies to Turkey. There is also Russia’s Nord Stream that supplies gas to Northern Europe, mainly Germany, via two pipelines running along the bottom of the Baltic Sea.
 
Azerbaijan, Turkmenistan, and the EU point to these pipelines as proof TCP could work as safely as the Russian pipelines laid across the bottoms of the Baltic and Black seas.
 
Iran has always supported Russia’s position on the TCP and probably will hold to that, at least until the EU comes knocking on Tehran’s door to ask about gas supplies.
 
Sefcovic addressed the ecological concerns after his meeting in Ashgabat, saying the EU had financed an ecological study of the project with the World Bank. “These are technologies which are reliable from the point of view of ecology,” he said.
 
Russia is almost certain to file a legal challenge to the construction of the TCP. That alone could hold up the project for years.
 
That, though, is not the biggest concern Azerbaijan, Turkmenistan, and the EU have concerning Russia.
 
For all the talk of the Caspian being a sea of peace and friendship, there was never much chance it would be that way. The oil and gas in the Caspian Sea is worth hundreds of billions of dollars and the European and East Asian markets are readily accessible from the Caspian and increasingly hungry for access to new supplies.
 
All five Caspian states have been building up navies in the last decade, but currently, and for the foreseeable future, Russia’s navy owns the Caspian. The only two agreements on the status of the Caspian were signed by the Soviet Union and Iran in 1921 and 1940. Tehran abided by those agreements since Iran was never going to be able to compete with Russian naval strength in the Caspian.
 
Azerbaijan, Kazakhstan, and Turkmenistan, of course, did not have any naval vessels when they became independent after the collapse of the Soviet Union in 1991, so they are far behind Russian and Iranian naval power. 
 
Russia has been building up its Caspian navy, including the recent additions of the stealth frigates Daghestan and Tatarstan, and regularly conducts maneuvers. In fact, some 20 naval vessels just returned to their ports in Astrakhan and Makhachkala on April 28 after holding drills.

In addition, Russia has missile batteries on its shores capable of striking targets some 300 kilometers away. And, of course, the Caspian -- being an inland sea -- offers no opportunity for outside countries to intervene by sending their warships to guard gas, oil, or pipeline projects. In the Caspian Sea, Russia can dictate events.

Interestingly, Sefcovic seems to have anticipated this problem. He said during his meeting with Turkmen President Gurbanguly Berdymukhammedov that they discussed the possibility of shipping Turkmen gas through Iran.

Iran is still under international sanctions and cannot at this time engage in such a project, but recent progress in talks with world powers have raised hopes those sanctions could soon be lifted. If and when that does happen, the TCP would not be needed, so it is unclear how quickly even the EU will be moving on the pipeline across the Caspian.

-- Bruce Pannier

This forum has been closed.
Comment Sorting
Comments
     
by: Panas from: Chernivtsi
May 05, 2015 16:19
Poor mother Russia having such idiots in their Klemin government. Had they not invaded Crimea and Donbas, it would have been a piece of cake to control most energy supply routes to Europe. But they goofed ROYALLY!
In Response

by: Regula from: USA
May 06, 2015 09:33
No, they didn't. Russia did the only logical and necessary thing by joining Crimea to Russai. It speaks in Russian favor that they did it in such a democratic way: with a referendum, not by annexation. For Russian national security that is vital. As to Donbas, Russia didn't invade Donbas. The US via CIA pushed Kiev to start a civil war on its own people. Russia always cautioned that the problem should be resolved with negotiation, not war. Since the Ukraine army so far lost against the rebels, Ukraine and the US lost their policy and industry. Russia is gaining what it wants: a Ukraine free of NATO. As the Chinese silk road traffic corridor moves closer to Europe, Ukraine will regret not to be part of it. The silk road scheme will be excellent business and Ukraine could have profited largely, had it listenend to Russia instead of the CIA. At this point, Russia can cut off Ukraine from the silk road routes unless it agrees to stay neutral, i.e. not to join either NATO nor CIS nor Asean, like Finland. In the long run, that is what Ukraine will choose - for its own benefit.

by: Konstantin from: Los Angeles
May 06, 2015 00:19
1.
Russia still will have tools blackmail,
as they do with their lines through E. Europe,
specially Ukraine.
It must be alternative reserves, make EU safe.
2.
Such reserves exist.
Israel has larger gas deposits than Russia
and can deliver it to Europe terminals in no time.
So can USA, a bit later.
3.
Europe must build such terminals to be ready for any emergency.
It would be near impossible for Russia to cut-of supply
in the same time to all terminals, gas from Russia and gas from Asia.
Also, with such alternative at hands, Russia will stop
harassment of Turkmen's project.
4.
The whole energy war is illegal and treasonous.
West gave Russia and CIS opportunity to make a lot of
wealth and prosper, but Russia "oklemalas' " and
started war against CIS, E. Europe, C. Asia and the West.
The complicity is still sabotaging EU brains - in 1954 Russia
lured into pact to resurrect colonial empires: Russia, Germany,
Austria and Britain.
They still bribing them with gas-oil supply for better price,
maybe even for free, using multiple transactions...

In Response

by: Regula from: USA
May 06, 2015 09:43
You seem to be some multiple decades behind the time. Russia isn't at war with either CIS, Eastern Europe or Central Asia. On the contrary, Russia founded the European Economic Union together with Belarus, Kasazkstan, Armenia and in a short time Kirgistan and Tajikistan. Turkey is thinking about joining that union and Georgia and Azerbaijan may in time do so as well. Iran may also join. So, no, Russia isn't trying to create a Russian empire, but a free trade economic space. China is interested in a free trade agreement with the Russian created EEU. The EU may in time also want a free trade agreement with the EEU.

The problem is really the EU who changes its laws to please the US rather than itself and who has no energy policy or plan whatsoever.

LNG gas from wherever it comes will be way more expensive than piped gas from Russia. That will not do much good to the EU economy.

Russia has no intention to sabotage gas supply to the EU because it needs the income, but it could of course if there were a need so to do. Construction of the necessary LNG terminals in the EU will take some 2plus years and cost several billion dollars. By necessity it adds cost to the gas price. The calculations made showed that LNG gas supply to the EU would about double the gas cost to the EU.
In Response

by: Konstantin from: Los Angeles
May 07, 2015 05:54
O, you are the clever one!
How refreshing to run into a Russian advocate
that say more than a drunken Russian threats and insults!
Still, it isn't true, what you try to pull here.
Russia is a "Kruchkotvor" that use formal letter of some rule
to follow "precedent", in this case "Classic capitalism fables",
like "Kings and Cabbages", to rob the World and expand
its evil Empire.
If victim is also clever, they simply invade and suck blood.
Like in Afghanistan, Chechnya, Moldova, Georgia, Ukraine,
violating all laws and agreements, including international Budapest agreement on Ukraine.
Sure they supply gas and oil to Germany, Austria and Britain,
not only money, but because they partners of Moscow-Prussian usurpers of USSR and Russia that lured in 1954
into pact resurrect colonial empires.
They bribe them all by not hitting them yet, and looking for soft spots in EU, like Greece (promised part of to be conquered Konstantinopol) and even France (staffed by many Russian emigrants, friends of "James Bonds").
But they expand and repopulate neighbor lands, hundreds of
thousands killed, millions refugees or slaves in Russia.
PS:
Terminals are not expensive and cost the security risk.
Russian investments?
Russia expropriated all wealth during USSR from its neighbors,
many Trillions, still hold in Russia millions non-Russian slaves,
including Ukrainians.
Russia still expropriate by Quislings-spies of Russia and bandit methods all wealth of former republics.
Georgia invaded to steal in Abkhazia valuable realty,
steal in S. Ossetia renovated by Georgians realty and land
and to invade the rest of Georgia.
Moldova invaded to steal intensive production of fruits and tomatoes that supplied Moscow parasites, and invade rest of Moldova.
Crimea and Ukraine invaded to destroy last energy supply,
coal and Sea shelf resources and invade the rest of it.
Russia don't invest - it takes over to suck blood,
while divide and rule.
Putin said to Kazakhstan:
All economy and what you have will be own by Moscow,
we let you run local police and national guard.
He sad same to Ukraine.
It is why, semi-strangulated Ukraine went to Maidan!
It is why parasitic Moscow Varyag-Prussian "Stervyatnik"
invaded, destroy Ukraine and murder people:
"Na koleni Hohol" - or knife in heart!
You are really the clever one, but not clever enough fool God!
In Response

by: Konstantin from: Los Angeles
May 07, 2015 11:47
Are you saying it was almost half Century ago?
It is Possible.
I am surrounded by armies of telepaths all my life,
including Bechtel and agencies of East and West.
They like play with human mind, plagiarize, block memory,
than play a new game of hope to create something,
than trying it again.
Still, though in childhood they stole concepts and solutions
that sold on world markets some 100 Trillions in computers and electronics,
I resist it all my life and don't doubt myself much.
As long as I go strait, don't betray God and Justice, and
do my best not create for enemies of God, I am only sorry
that the hideous Human "Gusnak" stole some in childhood,
murdered my grandparents and father, and I couldn't save
my mother, killed by Russia and CIA, 7/7/2012...
I try find justice, but it is abstracted by Russians and USA government and agencies.



by: Regula from: USA
May 06, 2015 09:25
The EU could likely long have diversified its gas supply to include Kazakh and Azerbaijani gas had the EU agreed to pay its share to the South Stream pipeline. It would have left Gazprom free to sell more gas to East Asia, while still keeping a sizable share of the EU South Stream market. But the EU thought Gazprom should pay for the entire gas pipeline and the EU would then decide whose gas would flow through it. And as expected, Gazprom didn't accept that. Now the EU is in a dilemma since they want Iranian gas, but it will take time for that to be possible. That could then again be a joint pipeline with Turkmenistan and Azerbaijan. By necessity, the EU would have to pay for all the pipelines since under EU law the producer of the gas and the transporter of the gas cannot be the same company anymore. The only way that can be done is for the EU to pay for the gas pipelines. That is a good amount of money, without any security that a Republican US admin will not re-impose the sanctions on Iran and prevent that gas flow - if for no other reason than to force the EU under US hegemony. The EU strangling itself with its own regulations.

The EU could have had very reliable and safe gas supply from Russia - and threw it away to pleasr the US. Now it will have to accept large risks and large costs. In addition, if Gazprom decides to scrap its Turkish stream and to stop delivering gas via Ukraine beginning in 2019, the EU will be entirely dependent on importing LNG, which is way more expensive than Russian gas. India, western China, Vietnam, Cambodia, Laos, Thailand will love Russian gas.

By the way, the Russian caution about environmental problems with a gas pipeline across the Caspian Sea floor may in fact be true, because the Caspian Sea is an inland sea, fed by rivers, but not connected to any other sea in a direct way. That results by necessity in a way more specialized and therefore fragile environment at the bottom of that sea.

by: Anonymous
May 06, 2015 14:35
Who said that caspian is closed and have no link with sea ?!?!

There is a canal system that link Caspian and Black sea
in the Don river region of Russia

In Response

by: Regula from: USA
May 08, 2015 09:49
You may in fact be right. It also appears on the map that there is a river/canal to both, Russia and Kazakhstan from the Caspian Sea and that there may be in fact be canals that connect it to the Black Sea. But notice: they are all inside Russia and the US wouldn't have any access to those canals for war ships!
In Response

by: Anonymous
May 14, 2015 01:20
There's no need for another war, don't u think? !

About This Blog

Qishloq Ovozi is a blog by RFE/RL Central Asia specialist Bruce Pannier that aims to look at the events that are shaping Central Asia and its respective countries, connect some of the dots to shed light on why those processes are occurring, and identify the agents of change. Content will draw on the extensive knowledge and contacts of RFE/RL's Central Asian services but also allow scholars in the West, particularly younger scholars who will be tomorrow’s experts on the region, opportunities to share their views on the evolving situation at this Eurasian crossroad. The name means "Village Voice" in Uzbek. But don't be fooled, Qishloq Ovozi is about all of Central Asia.

Most Popular

Editor's Picks