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Tag: Energy

  • Iran-Armenia pipeline expected online soon

    Iran-Armenia pipeline expected online soon

    YEREVAN, Armenia, May 19 (UPI) — Iranian gas supplies to Armenia through a 70-mile pipeline are expected to commence Friday, Iranian gas officials said while en route to Yerevan.

    Reza Kasaeizadeh, the managing director of the National Iranian Gas Exporting Co., headed to the Armenian capital Yerevan on Monday to finalize gas agreements, Iran’s Petroenergy Information Network reports.

    Russian, Armenian and Iranian officials inaugurated a final stage of a natural gas pipeline from Iran in December. Armenian Energy Minister Armen Movsisyan said the pipeline also serves as an alternative supply source should Russia disrupt energy transports through other routes.

    The pipeline will bring 81 billion cubic feet of natural gas from Iran per year, about the same amount Armenia imports from Russia via Georgia. In exchange, Armenia will convert natural gas to electricity for exports back to Iran.

    Kasaeizadeh said exports through the $220 million pipeline could reach 141 million cubic feet per day in the next two years, with a final capacity reaching 222 million cfd.

  • Turkey plays politics with EU pipeline scheme

    Turkey plays politics with EU pipeline scheme

    ANDREW RETTMAN AND VALENTINA POP

    08.05.2009 @ 17:04 CET

    Turkey’s Abdullah Gul (r) meets Czech leader Topolanek in Prague (Photo: eu2009.cz)

    EUOBSERVER / PRAGUE – The EU risks continued energy dependency on Russia and a sharp rise in natural gas prices unless it unblocks EU accession talks with Turkey, Ankara indicated on Friday (8 May).

    At an energy summit in Prague, Turkish President Abdullah Gul signed a declaration promising to close an inter-governmental agreement (IGA) in June on building the Nabucco gas pipeline through his country.

    But he linked the IGA deal to the EU’s opening the energy chapter of Turkey’s accession negotiations, blocked by Cyprus due to a long-standing territorial dispute.

    “In order to be more successful, it is of great importance that co-operation and solidarity exist on both sides,” Mr Gul said. “We believe the opening of the negotiations on the energy chapter will accordingly provide great benefits.”

    The Nabucco pipeline, which cannot go ahead without the IGA, is a project to pump by 2020 25 billion cubic metres (bcm) a year of Caspian Sea basin gas directly to the EU, bypassing Russia.

    The pipeline would reduce the impact on the EU of any future Russian gas cut-offs and complicate Russian plans to put gas prices on a higher footing for the long-term.

    European Commission head Jose Manuel Barroso in Prague on Thursday downplayed Turkey’s Nabucco-accession link. “He [Mr Gul] did not make any kind of conditionality,” the commission president said.

    The commission’s ambassador to Turkey, Marc Pierini, speaking to press in Ankara the same day, was less diplomatic, however.

    “Turkey is not formally linking Nabucco to Cyprus blocking the energy chapter in the Council [the EU member states’ secretariat], but it is part of their understanding of the issue,” he said. “It is a political play within the Council.”

    Ankara’s negotiating position is weakened by the fact it needs extra Caspian gas as much as the EU, the Paris-based International Energy Agency (IEA) told EUobserver.

    “It’s own gas use is growing. It consumed 16 bcm in 2002 and 37 bcm in 2008,” the IEA’s Ian Cronshaw said. “Sixty three percent of its gas comes from Russia and they got cut off in the Ukrainian crisis as well,” he added, referring to January’s Russia-Ukraine gas crunch.

    Turkmenistan disappoints

    In a second niggle at the Prague summit, world number four gas owner Turkmenistan did not sign the EU declaration pledging future gas volumes for Nabucco.

    Turkmenistan sent its number two official, Tachberdy Tagiev, to Prague, and two days before the summit released a political prisoner, Mukhametkuli Aymuradov, auguring well for EU relations. But it did not put pen to paper on the day.

    “Azerbaijan [which did sign] is a European country which has European aspirations. Turkmenistan is a Central Asian country that doesn’t have such aspirations, so that’s where I would look for the reason,” Czech Prime Minister Mirek Topolanek said.

    The political question marks hanging over Nabucco and other pipelines in the “Southern Corridor” region are preventing EU energy companies, such as Germany’s RWE, from moving ahead with contracts.

    “What is very helpful is a unified political signal supporting the idea of a Southern Corridor in general,” RWE spokesman Michael Rosen told this website.

    https://euobserver.com/world/28095

  • SOUTHERN CORRIDOR – EU signs deal on new gas pipeline

    SOUTHERN CORRIDOR – EU signs deal on new gas pipeline

    It is hoped that the piepline will start pumping gas to Europe by 2014 [EPA]

    The European Union has just signed an agreement with Turkey, Azerbaijan, Georgia, and Egypt in a bid to press ahead with a gas pipeline that would reduce its reliance on Russian energy. That shows the determination on the part of EU to end Europe’s energy dependence on Russia.

    Mirek Topolanek, the Czech prime minister, said the aim to open up a “southern corridor” for supplies was “not just a one-way street for pipelines…We envisage this as a new silk road where we’ll see the flow of information, goods, people and energy in both ways.” () (Aljazeera, MAY 08, 2009)

    “Two suppliers — Azerbaijan and Egypt — and two key transit states — Turkey and Georgia — agreed to give “the necessary political support,” and, where possible, “technical and financial assistance” to the construction of planned pipelines and transport routes needed to bring gas from the Caspian Basin region and the Middle East to the European market.”
    (RADIO FREE EUROPE, Antoine Blua, May 08, 2009)

    Here is the text of this important declaration ushering in a new age of energy diplomacy:

    ***

    DECLARATION: SOUTHERN CORRIDOR
    Prague Summit, May 8, 2009

    We, the Participants of the Southern Corridor Summit held in Prague on the 8th of May 2009;

    express our political support to the realization of the Southern Corridor as an important and mutually beneficial initiative, which will lead to the promotion of common prosperity, stability and security of all countries involved;

    understand the Southern Corridor as an area of mutual interest providing opportunities for cooperation of the various entities in our public and private sectors. The trigger but not the sole focus of this process of strengthening relations among the Southern Corridor countries will be enhancing our mutually beneficial energy cooperation, which has the potential to serve as a cornerstone for the overall cooperation among countries involved;

    acknowledge that infrastructure projects which interconnect the countries along the Southern Corridor will act as a catalyst for further co-operation in other areas. The successful cooperation in the field of energy will encourage investments also in transport area. The development of transport infrastructure, including for energy, will lead to an intensification of people-to-people contact, which is the fundamental prerequisite to further social, economic and political cooperation in the whole region;

    intend to overcome the main remaining commercial and non-commercial obstacles by coordinating on common progressive strategy, individual commitments of the countries concerned, namely energy producer, transit and consumer countries, and clear scheduling for the completion and functioning of concrete energy and transport projects to be realized and operated within the Southern Corridor, including the Trans-Caspian energy transportation projects;

    consider the Southern Corridor concept as a modern Silk Road interconnecting countries and people from different regions and establishing the adequate framework, necessary for encouraging trade, multidirectional exchange of know-how, technologies and experience.

    We consider

    The Southern Corridor concept as a synergy of the following documents:

    – the Partnership and Co-operation Agreements between the EU and Azerbaijan, the EU and Georgia, the EU and Kazakhstan, and the EU and Uzbekistan;
    – the Association Agreement between the EU and Turkey and the EU and Egypt;
    – the European Neighbourhood Policy, including the Action Plans, the Eastern Partnership, EU-Central Asia Strategy and the Black Sea Synergy;
    – the Memoranda of Understanding on strategic energy partnership between the EU and Egypt , EU and Kazakhstan, EU and Turkmenistan and EU and Azerbaijan;
    – the Declaration of the Budapest Nabucco Summit of 27 January 2009;
    – the Declaration of the Sofia Energy Summit of 24-25th April 2009;
    – The Baku Initiative and the Energy Road Map endorsed on the occasion of the Astana Ministerial Conference of 30 November 2006;
    – The Baku Energy Summit Declaration of 14th November 2008;
    – The Ministerial Statement on the Nabucco gas pipeline project of 26th June 2006;
    – Agreements on transportation of oil and gas through the Baku-Tbilisi-Ceyhan and Baku-Tbilisi-Erzurum oil and gas pipelines of 1999 and 2001 respectively;

    – Agreement among the Republic of Turkey, the Hellenic Republic and Italian Republic concerning the development of the Turkey, Greece, Italy Transportation Corridor of 26 July 2007 in Rome;
    – the European Council Conclusions of 8-9 March 2007, 16 October 2008 and 20th March 2009;
    – the European Commission’s Second Strategic Energy Review of 13 November 2008;

    – Decision No 1364/2006/EC of the European Parliament and of the Council concerning trans-European energy networks (TEN-E);

    – Commission Decision granting financial aid for an action of 2.12.2008 in the field of the trans-European energy networks (TEN-E);
    – the EU-financed INOGATE technical feasibility studies on the Trans-Caspian-Black Sea Gas Corridor as well as the feasibility study on the Caspian Development Corporation (CDC);
    – the European Commission’s Communication on the extension of the major trans-European transport axes to the neighbouring countries, of 31 January 2007;
    – the transport cooperation and initiatives involving the EU and the countries of the Southern Corridor ;
    – And bearing in mind international treaties and obligations, including those arising from the Energy Charter Treaty, the Energy Community Treaty as well as the existing bilateral and multilateral agreements fostering the development of projects of the Southern Corridor;

    We declare

    That the concept for the Southern Corridor is complementary to other existing energy and transport partnerships and projects of the EU and is open for the participation and contribution of third countries on a case-by-case basis in concrete projects, upon agreement of all the Parties to this declaration directly involved.

    That one of the basic prerequisites for developing the Southern Corridor is cooperation to establish interconnections starting with direct energy and transport links among the countries concerned as appropriate. We therefore agree to promote a common initiative to develop the conditions necessary for more effective transportation networks, including of energy resources, goods and people as well as an improved exchange of know-how and technologies within the Corridor with the participation of all the interested countries, international political conditions permitting. This should make the maximum use of the existing regional initiatives on energy and transport.

    On the basis of declared principles in the field of energy we,

    agree to give necessary political support and, where possible, technical and financial assistance to the construction of the Southern Corridor, including the Trans-Caspian energy transportation projects, in order to support the diversification of energy sources, markets and transport routes, which will not only enhance the energy security of the participating countries , but also will simultaneously constitute fair and profitable opportunities for energy producers, consumers and transit countries, while recognizing the need for this to be feasible, economically competitive, technically and environmentally sustainable and timely.

    welcome transparency, competitiveness, long term predictability and stable regulatory conditions to underpin the realization of concrete infrastructure projects in the framework of the Southern Corridor. This should include

    * firstly, the means to provide producers with reliable commitments of the consumers on their aggregate demand and the identification of non- committed natural gas and oil volumes by producer countries that can be dedicated specifically to the EU as well as the Corridor countries markets with a precise timetable for their availability on the basis of their commercial profitability;

    * secondly, the establishment of necessary and appropriate transit and environmental arrangements in line with the Parties’ international commitments;

    * thirdly, the need for companies to ensure direct, industry-standard commercial agreements between producers and consumers.

    envisage a mechanism for aggregating sufficient volumes to be transported through the Southern Corridor, and, take note of the feasibility study on the Caspian Development Corporation initiative that should lead to concrete proposals in this respect. In this context, eventually consider devoting, as appropriate, public and private financial resources necessary for the realization of the Southern Corridor, including encouraging the market-based participation of public and private companies.

    attain the energy security of all parties including consumer and transit states, such as Turkey, Georgia and Azerbaijan, on the basis of commercial agreements that are in line with the Parties’ international commitments.

    welcome that the countries concerned will endeavor to:

    – implement a clear, transparent, cost-based, stable and non-discriminatory transportation regime for natural gas or oil across the territories of the Corridor countries to end consumer markets, in line with the Parties’ international commitments.

    – establish direct connections between both sides of the Caspian Sea as one of the main important elements of the effective energy cooperation and favour the interconnection of the Southern Corridor with the EU through strategic infrastructure projects necessary for carrying natural gas by pipelines or ships. In the gas sector, interconnection will be established among others through the Nabucco project and the ITGI project both of which are financially supported in the EU Recovery Plan endorsed by the European Council of March 2009 as well as other projects within the Corridor. In the oil sector, an extension of the already operating transportation system between Kazakhstan and Azerbaijan could be developed in the Mediterranean and the Black Sea regions, taking into account the constrains of the Turkish straits.

    – promote the activities of public and private companies that are involved or willing to participate in the realization of the Trans-Caspian energy link.

    – achieve maximum energy efficiency and use of renewable energies as an important element for successful cooperation in the field of energy.

    Therefore, we express our readiness to share technologies, knowledge and know-how in order to reach efficient fuel use and further development of alternative energy sources to allow long-term and sustainable growth for all Corridor countries;

    – share technologies, knowledge and know-how for the development of energy resources, their transportation and technical upgrading within the Corridor.

    In the field of transport we endeavour,

    To support the promotion of regional and cooperative approaches to transport challenges in the Southern Corridor, which includes appropriate projects in the Mashreq, in particular Egypt and Iraq.

    To intensify cooperation in view of promoting the implementation of relevant infrastructure projects and of policy measures to facilitate exchanges, to support efforts to make transport projects within the Southern Corridor an effective and responsive instrument of cooperation and enhancing public-private partnerships and other ways of attracting investments.
    To implement the extension of transport trans European Networks to Turkey and South Caucasus and beyond to Central Asia along the Southern corridor, including connections to the Middle East.

    To encourage, with respect to high importance of railway transport in economies of Corridor countries, all parties involved to further develop the strategic railway networks and their interoperability. In this regard we support the railway and maritime corridor connecting the Caspian Sea Region with the EU, as well as a roll-on roll-off ferry connections between the EU and the relevant countries of the Southern Corridor, including Georgia.

    To share technologies, knowledge and know-how for technical upgrading of transport facilities within the Corridor in order to increase the transport efficiency.
    To harmonize technical norms and standards, ensure transparent and competitive tariffs, and to simplify custom procedures and border crossing in order to ensure fluent movement of all kinds of goods as a basic condition for deepening of trade among the involved countries.

    In the field of overall cooperation we agree,

    That strengthening of mutual relations must go hand in hand with following principles: transparency, non-discrimination , market economy and commercial profitability.
    To favour stable regulatory framework ensuring clear and predictable investment environment, which contributes to mutual trust necessary for successful realization of all strategic projects within the Southern Corridor.

    With respect to implementation and follow-up, we agree to strongly support the following steps:

    On energy:

    * The European Commission, together with the Council of the EU and the signatory partner countries, will monitor the implementation of this declaration and, in particular, work on developing an Action Plan seeking the implementation of the necessary conditions and the
    appropriate supporting measures for the Southern Corridor.

    * For the EU Member States concerned and Turkey to finish the negotiations of the intergovernmental agreement on Nabucco as quickly as possible, to sign it by the end of June 2009 in Turkey, and to continue to support the necessary steps for its implementation inter alia by identifying gas volumes available for marketing in the EU and Turkey.

    * For the EU Member States concerned and the relevant countries to progress further on the timely realisation of the ITGI project.

    * For the EU and the concerned countries to conclude the feasibility study on the Caspian Development Corporation initiative by the end of 2009 in view of the possible identification of relevant actions for the implementation.

    * For the EU and Iraq to sign an MoU on Energy as soon as possible, and for the EU and Egypt to cooperate and agree on specific projects in developing Egypt’s gas reserves and export potential for the EU, including via the Southern Corridor and encouraging energy investment, transfer of know-how for this purpose.

    On transport

    * To cooperate on the objective of promoting the extension of the trans-European transport networks to the countries of the Southern Corridor;

    * To work on developing an action plan on possible additional appropriate measures, including safety and security, to facilitate transport and transit flows along the Southern Corridor;

    * To work on a list of priority projects and policy measures for the development of the Southern corridor, and attract funds to implement them.

    Done and signed in Prague on 8th May 2009 in the presence of the representatives of Kazakhstan, Turkmenistan and Uzbekistan.

    For the EU,
    H.E. Mirek Topolánek, President of the European Council

    H.E. Jose Manuel Barroso, President of the European Commission

    For the Republic of Azerbaijan,

    H.E. Ilham Aliyev, President of the Republic of Azerbaijan

    For the Republic of Georgia,
    H.E. Mikheil Saakashvili, President of Georgia

    For the Republic of Turkey,

    H.E. Abdullah Gül, President of Turkey

    For the Arab Republic of Egypt,
    H.E. Sameh Fahmy, Minister of Petroleum of the Arab Republic of Egypt

    ***

    00000000000000000

    The European Union has signed an agreement with four countries in a bid to press ahead with a gas pipeline that would reduce its reliance on Russian energy.

    Azerbaijan and Egypt, which can both supply gas, and Turkey and Georgia, which are able to carry it, signed up to the Nabucco gas pipeline scheme on Friday at a meeting in Prague, capital of the Czech Republic.

    In return for their commitment to supply gas to Europe, the EU offered to provide more trade and stronger transport links to the gas producers and transit countries involved.

    Three key nations – Kazakhstan, Turkmenistan and Uzbekistan – refused to sign the text, diplomatic sources told the AFP news agency.

    ‘New silk road’

    Mirek Topolanek, the Czech prime minister, said the aim to open up a “southern corridor” for supplies was “not just a one-way street for pipelines.”

    He said: “We envisage this as a new silk road where we’ll see the flow of information, goods, people and energy in both ways.”

    Representatives from the United States, Russia and Ukraine also attended the summit as observers to the agreement.

    Dosya:Nabucco Gas Pipeline-tr.svg

    Iraq, which was also invited to the meeting, did not send any officials.

    The summit was called to help kick-start the Nabucco pipeline, which would link the EU to gas rich nations on and beyond the Caspian Sea, bypassing Russia and Ukraine.

    The pipeline, which once completed would stretch 3,300km from Turkey to Austria, could transport up to 31bn cubic metres of gas each year to western Europe.

    It is hoped that it will start pumping gas to Europe by 2014.

    The EU is keen to speed up the construction of the pipeline after a dispute between Russia and Ukraine in January over gas prices left large areas of Europe without  supplies of the resource for two weeks.
  • Armenia Talks Strain Turkey’s Ties With Azerbaijan

    Armenia Talks Strain Turkey’s Ties With Azerbaijan

    Perceived cooling in relationship between Ankara and Baku may have ramifications for the latter’s energy strategy.

    By Seymur Kazimov in Baku (CRS No. 490, 24-Apr-09)

    The refusal of Azerbaijan’s president to attend an international conference in Istanbul earlier this month has sparked speculation that Baku may be using its energy resources to exert pressure on its old Turkish ally.

    Ilham Aliev reportedly declined to attend the meeting of the Alliance of Civilisations initiative on April 6-7, aimed at fostering dialogue between the West and Muslim countries, in protest against Turkey’s perceived new policy on Armenia

    While not going to Istanbul, Aliev accepted his Russian counterpart Dmitry Medvedev’s invitation to visit Moscow on April 16 to talk about closer cooperation in the gas field.

    That day, the Turkish foreign minister, Ali Babajan, took part in a meeting of the Black Sea Economic Cooperation organisation, BSEC, in Yerevan, Armenia.

    Until now, Azerbaijan has been selling gas to its ally Turkey at half the market price of 380-430 US dollars per thousand cubic metres.

    This favourable price is now expected to go up, especially as Russia has said it is willing to buy Azeri gas for what it costs in the world market.

    Russia and Azerbaijan have been sounding each other out over closer energy ties for some months now.

    The chairman of Gazprom, Aleksei Miller, visited Azerbaijan to formalise Russia’s interest in buying natural gas from Azerbaijan last June.

    On March 27, the State Oil Company of Azerbaijan, SOCAR, and the Russian energy giant signed a memorandum, pursuant to which Azerbaijan is to start supplying gas to Russia from January 2010.

    Opinions vary on what has prompted Azerbaijan to seek closer cooperation with Russia in the energy field.

    Some experts suggest Aliev is revising his options with Turkey, in response to the prospect of the latter reopening its border with Armenia.

    Turkey closed the border with Armenia in 1993 in sympathy with Azerbaijan over the dispute over Nagorny-Karabakh.

    Russia has hitherto been seen as an ally of Armenia rather than Azerbaijan in the region.

    However, Baku political analyst Ilgar Mamedov downplays talk that Azerbaijan is using its gas wealth to take a form of diplomatic revenge on Turkey.

    He believes Aliev is more concerned about Turkey’s stance on selling transited gas than on the possible unsealing of the Turkish-Armenian border, or the Karabakh issue.

    “Azerbaijan wants its gas from the Shah-Deniz gas field to reach Europe via Turkey but Turkey wants to [remain able to] buy this gas for 150 dollars and then sell it on to Europe for 400,” he explained.

    “That scheme does not sit well with Aliev… That’s where the cause of the tension lies.”

    Mamedov said Turkey’s position on reselling the gas was justifiable, however, because it had closed its borders with Armenia for 16 years now, damaging ties with European countries and the US as a result.

    “It would be wrong to fault Turkey’s position on the gas issue,” he said. “Aliev has allowed himself to be guided by commercial interests alone and has launched a campaign against Turkey that is absolutely unacceptable.”

    The same expert said Aliev might have calculated that by selling gas to Russia he would secure Moscow’s sympathy over the dispute with Armenia, while Turkey would continue to support Azerbaijan over Nagorny Karabakh in any case.

    But the expert warned that if Azerbaijan now increased the price of gas for Turkey, the latter might rethink its entire stance on the conflict between Armenia and Azerbaijan.

    The Turkish newspaper Hurriyet was the first to suggest that Azerbaijan had declared a “gas war” against Turkey, and that Ankara was reviewing its relationship with Baku in consequence.

    Sources in Azerbaijan’s industry and energy ministry quickly denied the Turkish media reports, saying the Azeri authorities would have already come up with a response “if the information had been true”.

    But another Turkish newspaper, Yenicag, has carried similar information. It also suggested that Turkey’s ruling Justice and Development Party, the AKP, was now also questioning Turkey’s role in the planned Nabucco gas pipeline.

    This is intended to pump gas from Azerbaijan and other states in Central Asia to Europe via Georgia and Turkey, circumventing Armenia.

    The pipeline has been touted as a much-needed alternative route for natural gas to reach Europe, now increasingly worried about its heavy dependence on Russia for gas.

    While freeing Europe from energy dependence on Russia, the pipeline is also seen as a key strategic and economic weapon for Azerbaijan, strengthening its hand against landlocked, energy-poor Armenia.

    Azerbaijan’s discovered natural gas reserves are estimated at around 1.5 trillion cubic metres.

    Companies participating in the 12.4 billion US dollars’ worth Nabucco project are OMV of Austria, MOL of Hungary, Bulgargaz of Bulgaria, Transgaz of Romania, BOTAS of Turkey and RWE of Germany.

    Construction was initially supposed to start in 2009 and be completed by 2013, though the world economic crisis has put a dampener on those plans.

    Ilham Shaban, head of the Oil Research Centre in Azerbaijan,
    dismisses criticism in the Turkish and western press of Azerbaijan’s energy policies as ungrounded.

    He also denies that growing energy ties between Azerbaijan and Russia will come at the expense of Baku’s old ties to Turkey.

    The two countries, Shaban says, had long been supplying each other with electricity. “Negotiations are underway between Azerbaijan, Russia and Turkey regarding the gas issue,” he continued.

    “I assess the agreement between Azerbaijan and Russia as highly important, because ethnic Azerbaijanis make up 11 per cent of Russia’s population.”

    Political analyst Haleddin Ibragimli said he doubted deeper energy ties with Russia would much affect the drive to settle the Karabakh conflict.

    Azeri officials, meanwhile, reiterate that Azerbaijan is a sovereign state that pursues an independent policy and needs no advice on what countries it should cooperate with in the field of energy.

    In Moscow, Aliev said Azerbaijan and Russia would be protecting their energy security and their interests as producers and exporters of energy.

    Answering a question from the Interfax new agency about new agreements on transit and cooperation in the gas field, Aliev cautioned that the whole issue still remained under discussion.

    “Gazprom and the State Oil Company of Azerbaijan are busy discussing an agreement,” he said.

    “As is known, a memorandum has already been signed that corroborates the existence of mutual interests. For our part, there will be no restrictions to cooperation in the gas field.”

    Later, the president said the two countries also planned to work more closely together over oil, increasing the volume being pumped into the pipeline that runs from Baku to Novorossiysk in Russia.

    Another potential agreement concerns upgrading the gas pipeline from Baku to Novo-Filya in the near future. This 200 km-long pipeline runs via the capital of Azerbaijan along the Caspian Sea coast to the border with Russia.

    Fariz Huseinov of Memphis University says Turkey stands to lose out more than Azerbaijan, if Ankara alienates Baku over Armenia. This is because Turkey’s role as a transit country for Azerbaijan’s gas is negotiable.

    According to Huseinov, Azerbaijan had already signed an energy agreement with Ukraine that potentially relieved Azerbaijan from any dependence on Turkey as a transit country.

    Huseinov was referring to the one-on-one meeting between Aliev and his Ukraine counterpart Viktor Yushchenko in Baku earlier this month, where a number of protocols were signed for closer cooperation in 2009-10.

    “That would mean we could reach Europe otherwise than via Turkey,” he said. “We might use a route linking Georgia the Black Sea and Ukraine, detouring both Russia and Turkey.”

    Seymur Kazimov is an IWPR contributor.

  • War, Oil and Gas Pipelines: Turkey is Washington’s Geopolitical Pivot

    War, Oil and Gas Pipelines: Turkey is Washington’s Geopolitical Pivot

     by F. William Engdahl

     

     

    13171

     

     

    Global Research, April 14, 2009

      

    The recent visit of US President Obama to Turkey was far more significant than the President’s speech would suggest. For Washington Turkey today has become a geopolitical “pivot state” which is in the position to tilt the Eurasian power equation towards Washington or significantly away from it depending on how Turkey develops its ties with Moscow and its role regarding key energy pipelines. 

     

    If Ankara decides to collaborate more closely with Russia, Georgia’s position is precarious and Azerbaijan’s natural gas pipeline route to Europe, the so-called Nabucco Pipeline, is blocked. If it cooperates with the United States and manages to reach a stable treaty with Armenia under US auspices, the Russian position in the Caucasus is weakened and an alternative route for natural gas to Europe opens up, decreasing Russian leverage against Europe.

    For Washington the key to bringing Germany into closer cooperation with the US is to weaken German dependence on Russian energy flows. Twice in the past three winters Washington has covertly incited its hand-picked President in Ukraine, Viktor Yushchenko to arrange an arbitrary cut off of Russian gas flows to Germany and other EU destinations. The only purpose of the actions was to convince EU governments that Russia was not a reliable energy partner. Now, with the Obama visit to Ankara, Washington is attempting to win Turkish support for its troubled Nabucco alternative gas pipeline through Turkey from Azerbaijan which would theoretically at least lessen EU dependence on Russian gas.

    The Turkish-EU problem

    However willing Turkish Prime Minister Erdogan might be to accommodate Obama, the question of Turkish relations with the EU is inextricably linked with the troublesome issue of Turkish membership to the EU, a move vehemently opposed by France and also less openly by Germany.

    Turkey is one of the only routes energy from new sources can cross to Europe from the Middle East, Central Asia or the Caucasus. If Turkey — which has considerable influence in the Caucasus, Central Asia, Ukraine, the Middle East and the Balkans — is prepared to ally with the United States, Russia is on the defensive and German ties to Russia weaken considerably. If Turkey decides to cooperate with Russia instead, Russia retains the initiative and Germany is dependent  on Russian energy. Since it became clear in Moscow that US strategy was to extend NATO to Russia’s front door via Ukraine and Georgia, Russia has moved to use its economic “carrot” its vast natural gas resources, to at the very least neutralize Western Europe, especially Germany, towards Russia. It is notable in that regard that the man chosen as Russia’s President in December 1999 had spent a significant part of his KGB career in Germany.   

    Turkey and the US Game

    It is becoming clear that Obama and Washington are playing a deeper game. A few weeks before the meetings, when it had become obvious that the Europeans were not going to bend on the issues such as troops for Afghanistan or more economic stimulus that concerned the United States, Obama scheduled the trip to Turkey.


    During the recent EU meetings in Prague Obama actively backed Turkey’s application for EU membership knowing well that that put especially France and Germany in a difficult position as EU membership would allow free migration which many EU countries fear. Obama deliberately confronted EU states with this knowing he was playing with geopolitical fire, especially as the US is no member of the EU. It was a deliberate and cheap way to score points with the Erdogan government of Turkey.

     
    During the NATO meeting, a key item on the agenda was the selection of a new alliance secretary-general. The favorite was former Danish Prime Minister Anders Fogh Rasmussen. Turkey opposed him because of his defense of cartoons depicting the Prophet Mohammed published in a Danish magazine. NATO operates on consensus, so any one member can block Rasmussen. The Turks backed off the veto, and in return won two key positions in NATO, including that of deputy secretary-general.

     

    Turkey

    thereby boosted its standing in NATO, got Obama to vigorously defend the Turkish application for membership in the European Union, which of course the United States does not belong to. Obama then went to Turkey for a key international meeting that will allow him to further position the United States in relation to Islam.

    gasmap 
    Obama has a Grand Strategy to use Turkey to isolate Russia via Nabucco pipelines through Georgia and Armenia to the EU

    obamaerdogan 
    The Obama Erdogan talks were perhaps the most strategic of the recent Obama tour

    During US-Russian talks there had been no fundamental shift by Obama from the earlier position of the Bush Administration. Russia rejects Washington’s idea of pressuring IUran on their nuclear program in return for a bargain of an undefined nature with Washington over US planned missile and radar bases in Poland and the Czech Republic. The US claimed it need not rely on Russia to bring military and other supplies into Afghanistan, claiming it had reached agreement with Ukraine to transship mililtary supplies, a move designed by Washington to increase friction between Moscow and Kiew. Moreover, the NATO communique did not abandon the idea of Ukraine and Georgia being admitted to NATO. The key geopolitical prize for Washington remains Moscow but clearly Turkey is being wooed by Obama to play a role in that game.

     
    Germany will clearly not join Obama in blocking Russia. Not only does Germany depend on Russia for energy supplies. She has no desire to confront a Russia that Berlin sees as no real immediate threat to Germany. For Berlin, at least now, they are not going to address the Russian question.

    At the same time, an extremely important event between Turkey and Armenia is shaping up. Armenians had long held Turkey responsible for the mass murder of Armenians during and after World War I, a charge the Turks have denied. The US Congress is considering a provocative resolution condeming “Turkish genocide” agianst Armenians. Turkey is highly sensitive to these charges, and Congressional passage of such a resolution would have meant a Turkish break in diplomatic relations with Washington. Now since the Obama visit Ankara has begun to discuss an agreement with Armenia including diplomatic relations which would eliminate the impact of any potential US Congress resolution.

     

    A Turkish opening to Armenia would alter the balance of power in the entire region. Since the August 2008 Georgia-Russia conflict the Caucasus, a strategically vital area to Moscow has been unstable. Russian troops remain in South Ossetia. Russia also has troops in Armenia meaning Russia has Georgia surrounded.

     

    Turkey is the key link in this complex game of geopolitical balance of power between Washington and Moscow. If Turkey decides to collaborate with Russia Georgia’s position becomes very insecure and Azerbaijan’s possible pipeline route to Europe is blocked. If Turkey decides to cooperate with Washington and at the same time reaches a stable agreement with Armenia under US guidance, Russia’s entire position in the Caucasus is weakened and an alternative route for natural gas to Europe becomes available, reducing Russian leverage against Western Europe.

     
    Therefore, having sat through fruitless meetings with the Europeans, Obama chose not to cause a pointless confrontation with a Europe that is out of options. Instead, Obama completed his trip by going to Turkey to discuss what the treaty with Armenia means and to try to convince the Turks to play for high stakes by challenging Russia in the Caucasus, rather than playing Russia’s junior partner.

     

    The most important Obama speech in his European tour came after Turkey won key posts in the NATO political structure with US backing. In his speech Obama sided with Turkey against the EU and in effect showed Turkey Washington was behind her. Obama’s speech addressed Turkey as an emerging regional power, which was well received in Ankara. The sweet words will cost Turkey dearly if it acts on them.

     

    Moscow is not sitting passively by as Washington woos Turkey. Turkish President Abdullah Gul paid a four-day visit to the Russian Federation this February, where he met with President Dmitry Medvedev, Prime Minister Putin, and also traveled to Kazan, the capital of Tatarstan, where he discussed joint investments. Gul was accompanied by his minister for foreign trade and minister of energy, as well as a large delegation of Turkish businessmen. The stakes in this complex three-way Great Game for domination of Eurasia have been raised significantly following the Obama trip to Ankara. Turkey imports 65 percent of its natural gas and 25 percent of its oil from Russia. Therefore, Turkey is also developing a growing dependency on Russian energy resources, including coal.

     

    On March 27, 2009, a memorandum was signed between the Azerbaijani oil company SOCAR and Russia’s Gazprom. The memorandum includes a statement of deliveries, beginning in January 2010, of Azerbaijani natural gas to Russia.

     

    Gazprom was particularly interested in signing such an agreement with Azerbaijan, not the least because Azerbaijan is the only state outside Iran or Turkmenistan, both of which are problematic, that could supply gas to the planned EU Nabucco pipeline, for transporting natural gas from Azerbaijan and the Central Asia states through Turkey to south-eastern Europe. In reality, gas may come only from Azerbaijan. Russia has proposed an alternative to Nabucco project, South Stream, also in need of Azerbaijani gas, so in effect Russia weakens the chances of realization of Nabucco. Obama strategy is clearly not less confrontational with Russia. It is merely playing with a slightly different deck of cards than did Cheney and Bush.

     

     

     

     

    F. William Engdahl is a frequent contributor to Global Research.

    https://www.globalresearch.ca/war-oil-and-gas-pipelines-turkey-is-washington-s-geopolitical-pivot/13171

    The Russian Dimension

  • Nabucco Hucksterism, Iran Pollyanishness, and a $5 Billion Bribe. The Oil and Glory Interview: Steven Mann

    Nabucco Hucksterism, Iran Pollyanishness, and a $5 Billion Bribe. The Oil and Glory Interview: Steven Mann

    A Blog on Russia, Central Asia and the Caucasus

    Saturday, April 11, 2009

    On Thursday, a ceremony in the State Department will mark the retirement of Steven Mann, Coordinator for Eurasian Energy Diplomacy, after 32 years with the U.S. diplomatic service. The 58-year-old Mann served most of the last 17 years in senior positions in the Caucasus and Central Asia: He opened the U.S. Embassy in Yerevan in 1992, was ambassador to Turkmenistan, and tried to negotiate a deal between Armenia and Azerbaijan on Nagorno-Karabakh. For the last several years, Mann was America’s man on the spot in the New Great Game on the Caspian Sea.

    I visited Mann at his Chevy Chase home. Amid stacked up magazines and books, Mann told me that Europe’s “energy security” is not necessarily at peril. And, for O&G readers, he broke one bit of historical news: Remember the demise of the trans-Caspian pipeline in the chapter An Army for Oil? The one in which then-Turkmen President Saparmurat Niyazov persisted in demanding a $500 million bribe of the Bechtel-General Electric consortium? It turns out that Niyazov originally requested $5 billion. The edited interview:

    Q – Does the U.S. need a high-level ambassador on Eurasian energy? And what is your advice going forward?

    A – Yes it is helpful. But we also have to get away from Nabucco hucksterism.

    Q – What is that?

    A – In terms of the wrong lessons learned from [the Baku-Ceyhan pipeline], the wrong lesson learned is to adopt a project and attempt to bring it about through political will. I think so much of the governmental activism on both sides of the Atlantic the last few years has been devoid of a commercial context. There have been quite a number of officials who know very little about energy who have been charging into the pipeline debate. Nabucco is a highly desirable project, don’t get me wrong. But there are other highly desirable projects besides Nabucco. And the overriding question for all these projects is, Where’s the gas?

    Q – South Stream was Putin’s response to Nabucco. Did the U.S. blunder by promoting Nabucco before having the commercial context?

    A – In terms of whether we are talking EU or US diplomacy, I think you have to be credible. All too often we’ve gotten out ahead of the commercial realities of Nabucco. You have to be able to point to an upstream supply. You have to have a commercial champion. And governments don’t build successful pipelines. Consortia do. The object of any envoy should be to get all those stars aligned before you give the full embrace to any project.

    I think Secretary Clinton will bring a more unified focus to the U.S. effort. In the previous administration, we had six special envoys on energy in the State Department, and three deputy national security advisers on the [National Security Council] staff.

    Q – Is that too many?

    A – It’s four too many in State. And three too many at NSC.

    Q – The stated reason for Nabucco is to diversify Europe’s energy supply. Is that a valid enough reason for U.S. involvement? And is European energy security a genuine issue?

    A – Anyone who makes that argument knows very little about energy. And I often heard those arguments in the White House Situation Room. Diversification is an objective good. But it can be achieved in ways other than pipelines. The best thing Europe could do for its security is to link its energy grid, which it’s already doing.

    Q – Is there alarmism on the subject?

    A – The January cutoff of gas through Ukraine only affected 2-3% of European consumers.

    Q – So it is overplayed.

    A – Yea, I think it was overplayed. What also was underplayed was how successful the Europeans were in shifting gas, linking grids. That’s the untold story of [the January cutoff].

    Q – The corollary – that Russian domination of supply equals a political threat in Europe – is that also alarmist?

    A – With the EU, I think it’s hard to make that case. That’s the kind of argument that has to be dissected on a country-by-country basis. But Gazprom has been an extremely reliable supplier for 25 years. And I think Gazprom will continue to be an extremely reliable supplier to Europe.

    Q – So really one should not be vexed if and when Nord Stream and South Stream are built? And if it takes some time for the ducks to be lined in a row for Nabucco, so be it?

    A – Basically, yes. I think Nabucco is far more important to Azerbaijan and Turkmenistan than it is to the EU.

    Q – In the late 1990s, there was the initial effort by Bechtel and GE Capital to build a trans-Caspian pipeline from Turkmenistan to Baku.

    A – What happened was that Niyazov, with his Soviet mentality, demanded so-called preliminary financing. That is, an upfront payment to do the project. [The consortium] already paid a signing bonus of $10 million. But then Niyazov demanded in the range of $5 billion. Then it came down to $3 billion. And the consortium said, ‘This is utterly unrealistic.’ Niyazov thought they were bargaining. So he dropped the demand to $1 billion; then it came down to $500 million. The consortium said, You have until March 2000 or we walk. And at that time, they walked.

    The fundamental problem, and it’s relevant today, is that a foreign investor cannot rely on a governmental entity [in Turkmenistan] to supply the upstream, to supply the product.

    Q – Was it ever realistic that Niyazov was going to hook up with the East-West Corridor?

    A – It was and it is realistic. Without alternatives to the Gazprom monopoly, Turkmenistan has to accept the price that Gazprom is willing to pay. There is a powerful commercial logic to a trans-Caspian pipeline.

    Q – What is the best way today for a Caspian republic to get along in the region?

    A – Kazakhstan is a good model of how to develop a Eurasian energy sector. You’re good partners with Russia, but you take advantage of foreign technology and capital.

    Q – Does Russia have a role in helping to create a thaw between the U.S. and Iran?

    A – Every time there is a substantial political change in the U.S., the oil and gas industry gets up on its tip-toes and says, ‘Aren’t we about to have a change in policy?’ You saw this with the Bush-Cheney election in 2000; the industry thought now was the time it would happen. You saw it after the [2001] invasion of Afghanistan, with certain cooperation and contact between the U.S. and Iran. You’re seeing it now with the advent of the Obama administration. So this is something that the oil and gas industry is always waiting for – that change.

    Q – You are saying that this is nothing new.

    A – It is nothing new.

    Labels: Azerbaijan, Caspian, Kazakhstan, Nabucco, nord stream, oil, south stream

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