Posted on 12/05/2001 6:11:57 AM PST by #1CTYankee
Pipeline From Kazakhstan Officially Opens ALMATY, Kazakhstan--Investors and high-ranking officials from Kazakhstan, the United States, and Russia on 27 November quietly celebrated the grand opening of the Caspian Pipeline Consortium’s (CPC) 900-mile pipeline. The oil route runs from Tengiz in western Kazakhstan to the Russian Black Sea port of Novorossiysk, skirting trouble spots--including the current conflicts in Chechnya and Afghanistan--and opening the door to the energy-rich and sometimes volatile Caspian Sea countries.
“With the start of the CPC pipeline, Kazakhstan now has a reliable and effective system of transporting its petroleum to the world market. It will also increase the efficiency of the movement of crude oil,” Vladimir Shkolnik, the Kazakh deputy prime minister and the energy and mineral resources minister, said at the ceremony.
ChevronTexaco Chairman Dave O'Reilly called the CPC “a bellwether project for successful international cooperation” that “demonstrates the confidence the international business community has … in Russia and Kazakhstan."
Construction on the pipeline began in May 1999. The flow of oil was officially started on 26 March, and the first oil reached the terminal at Novorossiysk in August. It has already been producing approximately 600,000 barrels per day for the past month. Tankers loaded at Novorossiysk will transport oil across the Black Sea through the Turkish-controlled Bosporus to the Mediterranean Sea.
The CPC is owned by several different governments and multinational companies. Russia controls a 24 percent share and Kazakhstan a 19 percent share, while Oman holds 7 percent. The remaining 50 percent is held by the U.S. firms Chevron Caspian Pipeline Consortium Co. (15 percent) and Mobil Caspian Pipeline (7.5 percent), the Russian-U.S. partnership LUKArko (12.5 percent), and the Russian-Dutch joint venture Rosneft-Shell Caspian V.L. (7.5 percent).
Kazakhstan hopes to earn approximately $8.2 billion from the pipeline, two-thirds of it through taxation. Fifty percent of the revenue will be budgeted into the treasuries of the regions through which the pipeline is routed.
I've been doing a little reading, is seems Kazakhstan is not the only former Soviet coultry developing and growing it's oil production.
I'll try to locate some of the articles and brief you on the others.
Before the demise of the Soviet Union in 1991, only two independent states -- the USSR and Iran -- bordered the Caspian Sea. Now, five states -- Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan -- adjoin the sea, the repository of an estimated 200 billion barrels of oil and comparable reserves of natural gas.
Over the past few years, major Western oil companies have concluded a series of multi-billion dollar contracts with Azerbaijan, Kazakhstan, and Russia to explore and develop Caspian oil and gas deposits. But the implementation of these deals still depends to a large extent on the construction of a network of pipelines to export these hydrocarbon riches to Western markets.
At present, the only functioning pipelines run across Russia, giving it leverage over its newly-independent neighbors. And at least one such agreement is threatened by a dispute between Azerbaijan and Turkmenistan over the ownership of specific deposits because the international legal status of the Caspian Sea and the precise delimitation between the national sectors of the states that border it are unresolved.
I know that there was a plan to run a pipeline through Afghanistan - since abandoned for obvious reasons. Others are planned through Pakistan and the former Soviet Republics. Big news. I'll post the articles if I can find them.
Turkmenistan's President Saparmurat Niyazov continues to make the case for gas exports through Afghanistan. In October, Niyazov urged the United Nations to consider supporting the project as a way of bringing stability to the country, the Caspian News Agency reported.
Last week in Moscow, Kazakhstan's President Nursultan Nazarbaev also showed interest in an Afghan export option, when speaking of the country's attempts to form a new government. He was quoted by the Kazakhstan Today news service as saying: "Such (a) government must make (the) territory of Afghanistan open. We need to deal with rehabilitation of (the) Afghan economy. We are interested in Afghanistan as a transit country for us."
Get used to the name. It will no longer be just one of the 'Stans'.
Iranian Foreign Minister Kamal Kharrazi said on 1 December that two joint committees were being set up with Pakistan. The first is to plan for an Iranian gas pipeline to Pakistan and possibly India. The second is to aid reconstruction in Afghanistan.
Iran has tried to promote a line from its South Pars gas fields in the Persian Gulf for years, although there has been little mention of the project since last April. Reduced tensions with Pakistan following the defeat of the Taliban could make a pipeline more plausible, but there seems little doubt that peace, not a pipeline, is the first concern
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Would it be wrong for me to assume that these pipelines throughout the region would force a whole lot of cooperation?
That is a distinct possibility.
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