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GEORGIA: PIPELINE ROUTES ON A POWDER KEG
ISN
http://www.isn.ethz.ch/news/sw/details.cf m?ID=19324
Aug 20 2008
Switzerland
The crisis in Georgia came as a reminder of the vulnerability of
important Europe-bound energy supply routes and apparent western
inability to secure them.
Image: European CommunityBy Sergei Blagov in Moscow for ISN Security
Watch (19/08/08)
Even before the dust settled over the conflict in the breakaway region
of South Ossetia, hostilities between Russia and Georgia served to
cast doubts over the latter's role as a major transit nation to funnel
oil and gas to Europe.
Crucial energy supply routes, notably the Baku-Tbilisi-Ceyhan (BTC)
pipeline, cross Georgia having been designed to circumvent Russia:
Georgia had hoped to serve as a bridge to funnel oil and gas from
Azerbaijan and Central Asia, thus undermining Moscow's energy clout.
Georgian officials repeatedly complained the country had become victim
to pipeline politics. President Mikhail Saakashvili reportedly claimed
that the BTC oil pipeline was a major reason for the Russian assault.
But Russian military officials have denied claims that Russian aircraft
targeted Georgia's pipelines. "We do not strike oil pipelines as such
strikes could entail serious environmental repercussions," Russia's
Deputy Chief of General Staff Anatoly Nogovitsyn announced.
The Russian military had no need to hit the pipelines indeed, because
a mere demonstration of force apparently was enough to put tremendous
psychological pressure on both suppliers and consumers. During
the conflict, Russia's Black Sea Fleet patrolled Georgia's coast,
apparently indicating that the task to transport crude oil from ports
to international markets could become a challenging objective.
Russian strikes did not hit any of the international oil and gas
pipelines or any oil ports in Georgia, but they apparently forced
Azerbaijan's state-run oil company SOCAR and Kazakhstan's state-run
oil giant KazMunaiGaz to consider re-routing crude oil previously
exported via Georgia.
Oil company BP declared force majeure on the Baku-Supsa oil pipeline,
which carries Caspian oil from Azerbaijan to the Black Sea, and shut
it down as a precautionary measure citing security concerns.
Subsequently, Russia increased oil exports from Azerbaijan amid
concerns about the Georgian crisis. Russia's oil pipeline monopoly
Transneft announced it had doubled shipments of Azerbaijan's crude
oil via the Baku-Novorossiisk oil pipeline through Russia from 83,000
tons a month up to 166,000 tons a month. Transneft also suggested
raising shipments of Azerbaijan's crude up to 240,000 tons a month
in September.
Although volumes of Azerbaijan's oil supplies through Russia
remained limited, the re-routing served to indicate that the
Caspian energy suppliers hardly had any viable choices in a time
of crisis but return to Russia's sphere of influence. There have
been concerns that Georgia's volatility may adversely affect the
Odessa-Brody-Gdansk-Polotsk oil pipeline, designed to funnel Caspian
crude via Ukraine to Poland.
The crisis also came as a reminder that alternative energy supply
routes from Azerbaijan and Central Asia via Georgia happened to
be extremely vulnerable during a crisis and needed better security
arrangements than the Georgian government was able to provide.
The US, preoccupied with operations in Iraq, Afghanistan and other
hotspots such as Iran and Pakistan, was understood to hardly have any
appetite for committing forces of its own to secure the pipelines. Its
European allies were also in no rush to consider dispatching their
forces to protect energy supply routes. Therefore, the crisis in
Georgia also served to demonstrate western guarantees for Georgia
lacked substance, while Russian involvement was still needed in order
to secure the pipelines.
It was hardly a coincidence that Turkish Prime Minister Recep Erdogan
traveled to Moscow and Tbilisi amid the height of the Georgian crisis,
apparently seeking security guarantees for Turkey-bound pipelines.
The conflict with Georgia was in no way a dicey game for Moscow as the
Kremlin appeared to remain unconcerned with the potential response
of the US or Europe. Western threats to block Russia's bid to join
the World Trade Organization (WTO) or expel Russia from the G8 group
of industrial nations apparently have limited potential to influence
Moscow's policymaking.
The Kremlin might have calculated that the Europeans needed Russian oil
and gas so desperately that they could tacitly accept destabilization
of Georgia. Simultaneously, any potential Russian countermeasures in
response to possible western sanctions, notably a review of Moscow's
cooperation with the West on nuclear nonproliferation, could have
devastating repercussions for global security.
Furthermore, Russia's allies made it clear that Georgia could be hit
with new outbursts of separatism. Hostilities in South Ossetia may
spark movements in other Georgian regions: Mengrelia, Kvemo-Kartli
and in areas populated by Armenian and Azerbaijani minorities, Sergei
Bagapsh, head of Russia-supported Abkhazia, announced in Moscow on
14 August.
Furthermore, any troubles between Armenian and Azerbaijani minorities
in Georgia could potentially re-ignite a dormant conflict between
Azerbaijan and Armenia over who controls the disputed Nagorno-Karabakh
region. Such an eventuality may put an end to any plans of sustainable
oil and gas supplies from Azerbaijan and Central Asia, circumventing
Russia.
Therefore, the latest warnings that the powder keg in the Caucasus
had blown up appear premature, as the volatile region appears to have
much more explosive potential. And now Russia is better positioned
to make its move in the Caucasus, an unlikely host region for stable
energy supply routes.
ISN
http://www.isn.ethz.ch/news/sw/details.cf m?ID=19324
Aug 20 2008
Switzerland
The crisis in Georgia came as a reminder of the vulnerability of
important Europe-bound energy supply routes and apparent western
inability to secure them.
Image: European CommunityBy Sergei Blagov in Moscow for ISN Security
Watch (19/08/08)
Even before the dust settled over the conflict in the breakaway region
of South Ossetia, hostilities between Russia and Georgia served to
cast doubts over the latter's role as a major transit nation to funnel
oil and gas to Europe.
Crucial energy supply routes, notably the Baku-Tbilisi-Ceyhan (BTC)
pipeline, cross Georgia having been designed to circumvent Russia:
Georgia had hoped to serve as a bridge to funnel oil and gas from
Azerbaijan and Central Asia, thus undermining Moscow's energy clout.
Georgian officials repeatedly complained the country had become victim
to pipeline politics. President Mikhail Saakashvili reportedly claimed
that the BTC oil pipeline was a major reason for the Russian assault.
But Russian military officials have denied claims that Russian aircraft
targeted Georgia's pipelines. "We do not strike oil pipelines as such
strikes could entail serious environmental repercussions," Russia's
Deputy Chief of General Staff Anatoly Nogovitsyn announced.
The Russian military had no need to hit the pipelines indeed, because
a mere demonstration of force apparently was enough to put tremendous
psychological pressure on both suppliers and consumers. During
the conflict, Russia's Black Sea Fleet patrolled Georgia's coast,
apparently indicating that the task to transport crude oil from ports
to international markets could become a challenging objective.
Russian strikes did not hit any of the international oil and gas
pipelines or any oil ports in Georgia, but they apparently forced
Azerbaijan's state-run oil company SOCAR and Kazakhstan's state-run
oil giant KazMunaiGaz to consider re-routing crude oil previously
exported via Georgia.
Oil company BP declared force majeure on the Baku-Supsa oil pipeline,
which carries Caspian oil from Azerbaijan to the Black Sea, and shut
it down as a precautionary measure citing security concerns.
Subsequently, Russia increased oil exports from Azerbaijan amid
concerns about the Georgian crisis. Russia's oil pipeline monopoly
Transneft announced it had doubled shipments of Azerbaijan's crude
oil via the Baku-Novorossiisk oil pipeline through Russia from 83,000
tons a month up to 166,000 tons a month. Transneft also suggested
raising shipments of Azerbaijan's crude up to 240,000 tons a month
in September.
Although volumes of Azerbaijan's oil supplies through Russia
remained limited, the re-routing served to indicate that the
Caspian energy suppliers hardly had any viable choices in a time
of crisis but return to Russia's sphere of influence. There have
been concerns that Georgia's volatility may adversely affect the
Odessa-Brody-Gdansk-Polotsk oil pipeline, designed to funnel Caspian
crude via Ukraine to Poland.
The crisis also came as a reminder that alternative energy supply
routes from Azerbaijan and Central Asia via Georgia happened to
be extremely vulnerable during a crisis and needed better security
arrangements than the Georgian government was able to provide.
The US, preoccupied with operations in Iraq, Afghanistan and other
hotspots such as Iran and Pakistan, was understood to hardly have any
appetite for committing forces of its own to secure the pipelines. Its
European allies were also in no rush to consider dispatching their
forces to protect energy supply routes. Therefore, the crisis in
Georgia also served to demonstrate western guarantees for Georgia
lacked substance, while Russian involvement was still needed in order
to secure the pipelines.
It was hardly a coincidence that Turkish Prime Minister Recep Erdogan
traveled to Moscow and Tbilisi amid the height of the Georgian crisis,
apparently seeking security guarantees for Turkey-bound pipelines.
The conflict with Georgia was in no way a dicey game for Moscow as the
Kremlin appeared to remain unconcerned with the potential response
of the US or Europe. Western threats to block Russia's bid to join
the World Trade Organization (WTO) or expel Russia from the G8 group
of industrial nations apparently have limited potential to influence
Moscow's policymaking.
The Kremlin might have calculated that the Europeans needed Russian oil
and gas so desperately that they could tacitly accept destabilization
of Georgia. Simultaneously, any potential Russian countermeasures in
response to possible western sanctions, notably a review of Moscow's
cooperation with the West on nuclear nonproliferation, could have
devastating repercussions for global security.
Furthermore, Russia's allies made it clear that Georgia could be hit
with new outbursts of separatism. Hostilities in South Ossetia may
spark movements in other Georgian regions: Mengrelia, Kvemo-Kartli
and in areas populated by Armenian and Azerbaijani minorities, Sergei
Bagapsh, head of Russia-supported Abkhazia, announced in Moscow on
14 August.
Furthermore, any troubles between Armenian and Azerbaijani minorities
in Georgia could potentially re-ignite a dormant conflict between
Azerbaijan and Armenia over who controls the disputed Nagorno-Karabakh
region. Such an eventuality may put an end to any plans of sustainable
oil and gas supplies from Azerbaijan and Central Asia, circumventing
Russia.
Therefore, the latest warnings that the powder keg in the Caucasus
had blown up appear premature, as the volatile region appears to have
much more explosive potential. And now Russia is better positioned
to make its move in the Caucasus, an unlikely host region for stable
energy supply routes.