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THE ROVING
EYE
Pipelineistan's biggest game
begins
By Pepe Escobar
History may judge it as one of the capital
moves of the 21st century's New Great Game: May
25, the day high-quality Caspian light crude
started flowing through the Caucasus toward the
Mediterranean in Turkey. The Baku-Tbilisi-Ceyhan
pipeline (BTC) - conceived by the US as the
ultimate Western escape route from dependence on
oil from the Persian Gulf - is finally in
business.
This is what Pipelineistan is
all about: a supreme law unto itself - untouchable
by national sovereignty, serious environmental
 concerns (expressed
both in the Caucasus and in Europe), labor
legislation, protests against the World Bank, not
to mention mountains 2,700 meters high and 1,500
small rivers. BTC took 10 years of hard work and
at least US$4 billion - $3 billion of which is in
bank loans. BTC is not merely a pipeline: it is a
sovereign state.
This BTC state slices
Azerbaijan in half from east to west, then slices
Georgia in half almost from east to west, before
taking a dip south, bypassing secessionist Ajaria
and slicing Turkish Anatolia diagonally from the
northeast toward the south. The founding stone is
at British Petroleum's (BP's) gleaming terminal at
Sangachal, half an hour along the Caspian south of
Baku. The state is 44 meters wide, snaking 1,767
kilometers across three countries, two of those
(Azerbaijan and Georgia) extremely volatile, and
the other (Turkey) faces potential trouble from
dispossessed Kurds.
The pipeline itself is
only 126 centimeters wide, a dizzying steel
serpent of no less than 150,000 segments made in
Japan, finished in Malaysia and delivered by ship
to the Georgian port of Batumi, capital of the
separatist micro-republic of Adjaria - which is
virtually uncontrolled by Tbilisi.
To
understand the scope and ambition of BTC, one must
visit Villa Petrolea, the Baku headquarters of BP.
The BTC's major shareholders are BP (30.1%) and
the Azerbaijani state oil company SOCAR (25%),
followed by Unocal (US, 8.9%), Statoil (Norway,
8.71%), Turkish Petroleum (6.53%), ENI (Italy,
5%), TotalFinaElf (France, 5%), Itochu (Japan,
3.4%), ConocoPhillips (US, 2.5%), Inpex (Japan,
2.5%) and Delta Hess (a joint venture of Saudi
Delta Oil with American Amerada, 2.36%).
BP has invested at least $15 billion in
the country (exploration, exploitation, pipeline
construction). According to Baku's street wisdom,
the man who really rules Azerbaijan is David
Woodward, BP's chairman, known as "the viceroy", a
walking oil atlas with more than three decades
working for the company from Scotland to Abu Dhabi
and from Alaska to Siberia. Woodward and BP
mercilessly spin that BTC is the cleanest and
safest pipeline ever built. Georgian peasants and
English non-governmental organizations beg to
differ.
Dynasty,
Caucasus-style
BTC would be impossible
without the usual, strategically positioned
US-supported dictator - in this case old, ruthless
Caucasus hand Heydar Aliyev, who died in December
2003. A dynastic dictatorship is even better,
since his son Ilham became the successor in
fraudulent elections in October 2003. It also
helped that Ilham, a former playboy, happened to
be the head of the state oil company, SOCAR.
Azerbaijan was never about "liberty and democracy"
or color-coded revolutions in the style of
Georgia, Ukraine and Kyrgyzstan. Just last
Saturday in Baku, Azeri police beat up and
arrested more than 100 opposition protesters
demanding "Freedom!" and "Free elections!" This is
a regime that according to Transparency
International ranks 140th out of 146 in the global
corruption index. From Washington's point of view,
the Aliyev dynasty in Azerbaijan performs the same
role as Islam Karimov in Uzbekistan: they are
"our" dictators.
Azerbaijan, Georgia and
Turkey were all desperate to finish BTC on time.
Turkey owes a fortune to the International
Monetary Fund. Georgia survives thanks largely to
American handouts. Azerbaijan at least set up a
state oil fund to use oil revenues to the benefit
of future generations. But very few Azeris believe
in the corporate myth that BTC will enrich them.
Real life can be found less than a kilometer from
downtown Baku: huge families crammed in
Soviet-style communal apartments with scarce water
and electricity. Azerbaijan could easily be pinned
down as a land of rickety Ladas and Volgas
crisscrossed by an armada of white BP 4x4s with
satellite dishes on top - which allow the
headquarters either in London or Baku to
immediately locate all "troops" anywhere in the
volatile Caucasus. The only other flourishing
industry in the Caucasus, apart from oil, is
kidnapping. Not to mention Kristina, the top
belly-dancer at the Karavanserai, the favorite
restaurant of the oil oligarchy, who is in a class
by herself.
In Georgia the obstacles were
more complex than in Azerbaijan. Thus the "Rose
Revolution" of late 2003, getting rid of Edward
Shevardnadze to the benefit of young, photogenic,
American-educated and American-aligned Mikhail
Saakashvili. The small matter of defending BTC
from attacks of alleged al-Qaeda-related Chechens
holed up in the Georgian mountains remains. But at
least protection at the end of BTC in Ceyhan in
Turkey is guaranteed: it's not a coincidence that
the pipeline ends right next door to the massive
American airbase at Incirlik.
Game not
over
In terms of no-holds-barred power
politics and oil geopolitics, BTC is the real deal
- a key component in the US's overall strategy of
wrestling the Caucasus and Central Asia away from
Russia - and bypassing Iranian oil and gas routes.
Kazakh President Nursultan Nazarbaev, for
instance, has just announced that Kazakh crude
will also flow through the BTC before 2010. He
even proposed to add Aktau - the Kazakh Caspian
oil Mecca - to a new acronym (ABTC?). It's
interesting to remember that BP always denied that
it needs Kazakh oil to fill its pipeline.
Everything related to BTC spells
tremendous ambition. It will take a few months to
fill the pipeline - and for the supertankers at
Ceyhan to be loaded with Caspian crude, thus
bypassing the highly congested Bosphorus. BTC is
projected to reach 1 million barrels a day -
roughly 1.2% of global production. Compare it with
the 500,000 barrels of the Caspian Pipeline
Consortium, which moves crude from Baku to the
Russian port of Novorossiysk.
BTC makes
little sense in economic terms. Oil experts know
that the most cost-effective routes from the
Caspian would be south through Iran or north
through Russia. But BTC is a designer masterpiece
of power politics - from the point of view of
Washington and its corporate allies. US Vice
President Dick Cheney, already in his previous
incarnation as Halliburton chief, has always been
a huge cheerleader for the "strategically
significant" BTC. The verdict is open on whether
this massive investment will be worth it. Instead
of the dreams of a new Kuwait, the Caspian may
hold only 32 billion barrels of oil - not much
more than the reserves of Qatar, a small Gulf
producer. The Caspian in fact may hold less than
10% of the total, known Middle East reserves.
Anyway, what really matters is positioning
in the New Great Game. The Caucasus, the Caspian
and Central Asia are up for grabs. European
customers for Azeri (and Kazakh) oil and gas might
rely on BTC for some of their supply. But the
Russian counterpunch will come: President Vladimir
Putin will not cease to seduce the European Union
with loads of Russian, Caspian oil - plus strong
protection - in return for loads of European Union
investment. Ladies and gentlemen, place your bets.
(Copyright 2005 Asia Times Online Ltd. All
rights reserved. Please contact us for information
on sales, syndication and republishing.) |
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