Robert M. Cutler on Energy and Eurasia

Корреспондент "НГ" Игорь Ротарь в своей статье "Чеченские проекты получают международную поддержку" обратил внимание на новые аспекты кавказской политики, значение которых трудно переоценить. Речь идет об инициативах одного из чеченских лидеров Хожахмеда Нухаева по созданию "Общего рынка Кавказ - Евразия", способного лишить Россию монополии на транспортировку каспийской нефти. Дело в том, что и самому мне неоднократно доводилось выступать с аналогичными предложениями - например, в январе 1995 г. на международной конференции, организованной администрацией президента Финляндии совместно с Институтом мировой политики (Нью-Йорк) и МГИМО, собравшей представителей высокого уровня из почти всех новых государств Евразии, в октябре этого года - в Вашингтоне, на международной конференции, поддержанной IREX и неправительственным Национальным бюро азиатских исследований. В 1996 г. в Tбилиси вышла моя статья на ту же тему в научно-политическом журнале "Кавказские рeгиoнaль-ныe исследования". В ней я защищал проект создания евроазиатской нефтяной и газовой ассоциации, или EAOGA.

The military operations in the Balkans affect the calculations concerning export routes for Caspian oil. The near-term regional effect of the hostilities in Kosovo is to make the Baku-Ceyhan line slightly more likely.

In the early 1990s, the Caspian oil exploration was like a high-ante, high-stakes game of poker with several rounds of draw and a large (but unknown) number of wild cards. A lot of the players frankly acted like cowboys shooting from the hip, and there was a lot of bluffing as well. It was, moreover, a "table stakes" game: if you couldn't meet the level of the bet when it came your turn to call, you had to clear out or find some kind of collateral, usually by signing an IOU to another player who would back you and split any winnings. This is why consortia were established: to pool resources and intelligence.

The problem the AIOC has in the short term is the opposite of the one that everyone has been talking about in the long term. In the long term, the general opinion is that there will be a problem is finding enough oil to fill the Baku-Ceyhan pipeline if it is built. In the short term, the problem is finding enough pipelines to take its oil production exported from Baku.

Kazakhstan is now in the midst of a comprehensive re-evaluation of its export options. The strategies and choices open to Astana concerning international energy development must be seen in the perspective of the difficult political and economic problems facing the country's leadership. This week begins a multi-part article on Kazakhstan and international energy development. This four-part article begins here with a review of the political geography of Kazakhstan's economy and an assessment of why China cannot be the preferred export solution.

Part one of this series, published after BP-Amoco made an announcement in support of the Baku-Ceyhan Main Export Pipeline (MEP), reviewed the background to that decision and its implications with regard to the four agreements being negotiated between Turkey and Azerbaijan. It also discussed what the MEP agreement and the cost guarantee agreement might look like. Part two began the discussion of the agreement between investors and transit states. This week's column is being written on the weekend preceding the November 18-19 meeting of the Organization for Security and Cooperation in Europe (OSCE) in Istanbul. It is expected that a set of framework agreements will be signed at that meeting, at least by Turkey and Azerbaijan. In anticipation of that event, the discussion of the agreement between investors and transit states will continue here, with special attention to Georgia. First, however, will come a few necessary preliminary remarks about BP-Amoco and the Istanbul conference.

The signing of the Istanbul Protocol on the Baku-Ceyhan pipeline at the recent OSCE meeting was highly important politically to the leaders who signed it. But the project will in the long run be more important to the peoples of the region than to those leaders who expended so much effort bringing it about. The pipeline deal presents regional leaders with a fateful decision. Should they fail to use local suppliers and train local labor for its construction, current disparities in income distribution will become aggravated. This could create civil unrest, leading to political instability that would threaten the pipeline project itself. But by using local NGOs to train a capable workforce, individual workers would experience the decision-making autonomy necessary to foster democratic institutions, build civil society, and perhaps also lead to civil unrest.

This commentary provides background on Javakhetia, the ethnically Armenian region in southern Georgia, in order to establish that is not the next Karabakh and not another Abkhazia, and therefore neither flashpoint nor bottleneck for oil pipelines crossing the Caucasus from the Caspian to the Black Sea. Stability in Javakhetia is likely to continue, although in the long term there is a wild card: the Meskhetian Turks, a people deported by Stalin whose has been mandated to their homeland, which lies west of Javakhetia proper and east of Ajaria.

Nearly two weeks ago, twenty-two individuals (twelve citizens of Russia and ten ethnic-Russian citizens of Kazakhstan) were arrested in Ust-Kamenogorsk in East Kazakhstan province. They were charged with planning an uprising to seize political power in the province and proclaim a republic called "Russian Land," autonomous of both Russia and Kazakhstan. The deeper significance of this group's arrest is not limited to only inter-ethnic relations in Kazakhstan or even problems of democratization in the country; it more importantly concerns relations between Russia and Kazakhstan and the future geopolitical configuration of Central Eurasia itself.

This week's column continues the discussion, begun last year, of the Baku-Ceyhan main export pipeline (MEP) accords initialled in Istanbul during the November OSCE summit. Although none of these agreements has yet been published, their outline and some of their details have already been analyzed here from available information. Of the four agreements initialled, previous columns this series looked at the MEP agreement itself and the cost guarantee agreement. As suggested earlier in this series, it turns out that the agreement between the investors and the transit states is complex and still subject to further clarification, as a precondition for establishing the definitive terms of the construction contract itself.

Recent initiatives aimed at fostering a multilateral security system in the South Caucasus potentially represent an historic shift in how Russia relates to the region. These initiatives would lead Russia to view the South Caucasus as an area for common co-operation rather than to treat it as a private preserve. The effectively autonomous province of Ajaria in southwest Georgia, and the Russian military base at its capital Batumi, are auspicious for the political integrity of the Georgian state and for South Caucasus regional stability. The ramifications for Georgia are especially profound. The ongoing [late 1999 and early 2000] fighting in Chechnya has strained relations between Russia and Georgia, as Moscow has repeatedly accused Tbilisi of providing tacit assistance to Chechen separatists. Georgian officials deny the accusations and assert that Russia's "special services" (as distinct from the Russian government itself) have been acting as agents provocateurs.

Dissatisfaction among ethnic Russians in Kazakhstan is growing. Many have left since the country gained independence, and those who remain are feeling increasingly frustrated and excluded by "Kazakhization" policies. Emigration has caused a significant decline in Kazakhstan's overall population, far outpacing the higher birth rates of those remaining.

Ceded by Turkey under the 1921 Treaty of Kars, Ajaria under the Soviet regime enjoyed the status of Autonomous Republic inside Georgia. As the USSR withered away, the modern Georgian state was established as a unitary political entity without autonomous sub-units, but Ajaria retained de facto autonomy after 1991. After Eduard Shevardnadze was re-elected President of Georgia last month [April 2000], the parliament in Tbilisi voted to change the constitution, transforming the administrative region of Ajaria into the Ajarian Republic. This federal precedent may help resolve the status of South Ossetia, but it will not satisfy Abkhazian demands. To establish Javakhetia as a federal entity could create more problems than it solves.

Three weeks ago I began describing part of the industrial infrastructure problem in the Caspian region. Limitations of physical geography require relative self-sufficiency in the development of basic infrastructure and installation of production facilities. The amount of investment required to build up the infrastructure capacity also limits the pace of the region's development. Steel fabrication capacity is especially key.

One of the properties of increasingly networked relationships is that they seem to begin to take on a life of their own. The word "self-organization" is used for describing this. In the evolution of networks, events can occur that seem insignificant at the time but which, in retrospect, stand out as crucial markers of qualitative development. (The technical name for this phenomenon is a "bifurcation point.") In this column, I will explore—without using the technical jargon—the question of whether we are approaching such a bifurcation point in the self-organization of the emerging network of Caspian energy pipelines.

China has declared ownership of its planned pipeline from Xinjiang to Shanghai open to foreign entities. This follows President Jiang Zemin's visit to Turkmenistan, where he discussed the possibility of a pipeline to carry natural gas from that country across Uzbekistan and Kazakhstan to Xinjiang. The announcement comes three weeks after Hong Kong tycoon Li Ka-shing, whose companies recently bought a stake in PetroChina, reportedly made the suggestion to Chinese officials at a June 23 meeting.

The Chinese National Petroleum Corporation (CNPC) asserts that Xinjiang has 17.4 trillion cubic feet of proven gas reserves. However, it is not clear that they are all recoverable. The geology is frequently difficult and the depths are often extreme. It is more likely that this figure is for potential or estimated reserves. Indeed, several years ago western energy companies, encouraged by Beijing's touting of Xinjiang's natural energy resources, paid high fees to test-drill for oil, and they came up dry. Now, the 2,600-mile-long "West-East" pipeline is projected to carry gas from Xinjiang to Shanghai at a construction cost of $5 billion and to open in 2003.

The lack of economic momentum in Uzbekistan has led to a general decline of great-power interest in the country. In a vicious circle, Uzbekistan's profile in international and regional diplomacy has fallen in turn. Its response could be called an "all directions" strategy, after France's General De Gaulle's "tous azimuts" nuclear doctrine of the 1960s. But whereas De Gaulle targeted the source of every possible threat, even from allies, for President Karimov "all directions" means looking for help from whatever direction of the compass he can find it. This policy on the part of the government risks manifesting as an "every man for himself" policy for Uzbekistani individuals in their everyday lives.

In my most recent installment in this series, I indicated that recent developments pointed towards the need to review Turkmenistan's options for export of its natural gas. That is the subject of this article.

First published in Foreign Policy in Focus, March 2001, pp. 1-2. Copyright © Robert M. Cutler.

A new report by the International Crisis Group (ICG) helps answer the question about what the appropriate responses are to Islamic militancy in Central Asia. The ICG is a highly respected, well connected, expert, private, multinational organization that describes itself as "committed to strengthening the capacity of the international community to anticipate, understand, and act to prevent and contain conflict." In its new report titled "Central Asia: Islamist Mobilisation and Regional Stability," ICG makes recommendations to Central Asian governments, external powers, and international organizations.

In early April the United States is hosting a nearly week-long meeting in Key West, Florida, bringing together President Robert Kocharian of Armenia and President Heydar Aliev of Azerbaijan. This meeting is part of a continuing attempt to settle the conflict between the two countries over the region of Nagorno-Karabakh. This region is an enclave in Azerbaijan settled by Armenians since the early nineteenth century, and from which the resident Azerbaijanis were chased during a war in the late 1980s.

History

In the late fifteenth century, what is now known as the Transdnistria--the region on the eastern bank of the Dnistr River and with the border of today's Ukraine for its eastern limit--was part of the Kingdom of Lithuania. By the mid-sixteenth century it had passed into the Ottoman Empire, of which it remained a part until the late eighteenth century, when the whole western coast of the Black Sea from Odessa to Varna (now in Bulgaria) became embroiled in military conflicts among the Ottoman, Russian, and Austrian Empires. From that era it emerged as part of the Russian Empire. After the Bolshevik Revolution and First World War, it became part of the Ukrainian Soviet Socialist Republic, until Stalin redrew the internal borders of Moldavia and Ukraine in 1940, when it was attached to a remnant of the former Romanian province of Bessarabia to form the Moldovan Soviet Socialist Republic. There it remained until 1991, when it became part of independent Moldova.

Toward the end of President Bush's September 24[, 2001] statement about freezing terrorists' assets, one finds the overlooked but no less remarkable assertion that the U.S. is "working closely with the United Nations, the EU and through the G− 7/G−8 structure to limit the ability of terrorist organizations to take advantage of the international financial systems."

History

Russia's entry into the North Caucasus dates from the military campaign begun in 1783. The resistance was led by Sheik Mansur, a Chechen captured in 1791. From 1824 to 1859, the Muslim peoples of the North Caucasus led by Imam Shamil fought a long, bloody war of resistance, but the Russians won through overwhelming numbers and a policy of total war. After the Bolshevik Revolution, Stalin's collectivization campaign in 1929 led to new rebellion and repression. During 1936-38 the purges led to the imprisonment and execution of thousands of Chechens.

In its new war on terrorism, Washington is quickly moving to put its "strategic partnership" with Uzbekistan to work. It has already turned to Uzbekistan's President Islam Karimov, who has spent the past decade cracking down so hard in his own country that he has driven the possibility of loyal Islamic dissent out of the political arena, and is now targeted by the Taliban-backed Islamic Movement of Uzbekistan (IMU), with which there have been military clashes over the past two years.

The effect of events in Afghanistan on public opinion in Central Asia is difficult to gauge. Yet this public opinion is already in general either exhausted by economic hardship or increasingly discontent with political repression. That very situation is what presents the danger that the U.S. rapprochement with Central Asian regimes will negatively affect its long-term interests.

Earlier this month, a helicopter carrying members of the United Nations Observer Mission in Georgia (UNOMIG) was shot down after taking off from Sukhumi, capital of the secessionist region of Abkhazia. It crashed, killing all nine on board. At first glance, it might seem that some party to the secessionist conflict whether Georgian, Russian, or Abkhaz--was trying to take advantage of the world's attention being focused on Afghanistan, in order to pursue tactical, strategic, or political aims in Georgia. However, the situation is more complicated than that.

The air strikes on Afghanistan put U.S. policy in Central Asia in a delicate position. On the one hand, Central Asian governments will be tempted to harden further their authoritarian domestic policies toward dissent and opposition, driving people further toward Islamic-based protest. If popular opinion in the region comes to identify the U.S. too directly with those policies, then the post-authoritarian transitions could see widespread Islamic militancy, tied to anti-Americanism, come to the fore.

HISTORY

Roughly three millennia ago, two unions among tribes then inhabiting present-day Georgia established the political structures that survive in the written historical record. One of these unions was that of the Colchis, whose land Greek legend depicts in the myth of Jason and the Argonauts as the origin of the Golden Fleece. After the Colchis' kingdom weakened and fell, its eastern provinces constituted themselves a new kingdom called Kartli. At the same time, roughly about the time of Rome's founding according to the legend of Romulus and Remus (753 BC), the Greeks began colonizing the Black Sea coast in the west of the land. The cities they founded still survive. In the Abkhazia region, for example, Dioskuras is the forerunner of present-day Sukhumi, which the Abkhaz call "Sukhum" (the terminal "-i" being a syntactical Georgianization.)

History

The Russian Empire annexed Ossetia in the first decade of the nineteenth century. After the Bolshevik Revolution, this became in March 1918 the Ossetian Autonomous Soviet Socialist Republic, renamed the Mountain Autonomous Republic in January 1920. In 1922, the section of this region south of the mountains became the South Ossetian Autonomous Oblast within the Georgian Soviet Socialist Republic. In 1989 it declared itself to be part of the Russian Soviet Federated Socialist Republic, then declared itself sovereign in August 1990. In response, Georgia abolished South Ossetia's autonomous status within Georgia in December 1990. After South Ossetia declared independence (not internationally recognized, and as distinct from sovereignty) on November 28, 1991, Georgia in April 1992 reestablished the South Ossetian Autonomous Oblast.

Before the terrorist acts in New York City, the U.S. looked to be largely absent diplomatically and militarily, while limiting its economic presence to Caspian energy development in Kazakhstan and Turkmenistan. Yet the formation of a U.S.-sponsored ‘global anti-terrorist coalition’ has not undercut the basis for the Sino-Russian rapprochement signaled by the institutionalization of the SCO and the signing of the first bilateral Sino-Russian treaty in fifty years.

Just when it looked the Central Asian countries were facing the growing joint political hegemony of Russia and China in the region, the events of September 11 opened the door to an increased and indefinite-term U.S. military presence.

Washington has not only blocked the impending closure of Sino-Russian hegemony over Central Asia, but also finessed Russian strategic opposition to the American project for deploying a space-based defense. The new U.S. presence in Central Asia has reinforced the emerging post-Cold War reconnection of Central Asia with South and Southwest Asia. In geopolitical terms, Uzbekistan remains the "pivot" of the region. However, within the larger "shatterbelt" that Central Asia represents for the broader Eurasian landmass, the post-Nazarbaev future of Kazakhstan looms large.

Central Eurasia, which is what specialists have taken to calling most of the geographic area once covered by the Soviet Union, has a long history of ethnopolitical complications and related struggles focused on collective identities. Tsarist Russia had moderate success in keeping these within bounds, partly because it was willing to tolerate such collective identities as social constructions autonomous of its own political rule.

The Union of Soviet Socialist Republics (USSR) had a more insistently penetrative ideology that left little room for cultural, ethnic, or religious autonomy. The Soviet regime tapped the mass communications technologies of the twentieth century to pursue its control over all populations and to implement its program of political socialization. All ethnically based opposition to Moscow’s rule was driven underground. The all-pervasive nature of the Soviet political and security apparatus made calls for any significant sort of self-determination extremely difficult to sustain. When Gorbachev combined economic reform (leading to economic disruption and attendant problems of supply) with political empowerment (permitting Soviet citizens to voice complaints publicly without the fear of repression), he unwittingly unleashed two elements necessary for a political explosion. Long discussed (but little understood) in Soviet political writings, the so-called ‘national question” became the fuse igniting the internal conflicts that burst forth across the Soviet regions in the late 1980s, as the USSR collapsed, and into the 1990s.

Transcript of radio interview, evening of 2 November 2002, with John Batchelor on "Batchelor & Alexander", WABC (New York).

Press reports have indicated that what separates the United States and Turkey in their negotiations [over conditions for American access to Turkish territory and facilities for military action against Iraq in 2003] the size and nature of the economic package wanted by Ankara. This is partly true, but it is not the whole story, and not even necessarily the most important part of the story. Military aspects of any Turkish incursion into northern Iraq and political aspects of northern Iraq's future are, rather, the more significant sticking points. Before discussing the latter, it is nevertheless useful background to review how the level of the economic package has recently increased.

Press reports, especially in North America, suggested that a deal between Ankara and Washington was just a question of money, using the metaphor of the bazaar to explain Turkish negotiating behavior. In the end, this description was shown to be ill-conceived and inaccurate. More was at stake than just the amount of money. Turkish leaders consistently said so, but no one in Washington seemed to hear them. The American administration also appeared to assume that the ruling Justice and Development Party (AKP) in Ankara could make its parliamentary deputies fall into line as easily as the Republican Party in the US can whip its congressmen and senators into supporting administration policy.

The Turkish Grand National Assembly, in failing to approve the economic assistance package to be provided to Turkey by the US in return for American troops using Turkish soil for an attack on Iraq, also failed to authorize Turkey's army to enter northern Iraq. The Turkish constitution requires a parliamentary vote to send the country's armed forces outside its own borders. With this not being approved, the dynamics of the impending war have changed.

The recent detention of Turkish soldiers by US troops in northern Iraq is only a symptom of the divergence of interests between erstwhile Cold War allies. The vote of the Turkish Grand National Assembly this year against allowing the United States to use Turkey's territory for transit of military forces in the run-up to Gulf War II is likewise only a symptom of that divergence of interests.

The significance of the agreements on energy cooperation achieved during Russian President Vladimir Putin's recently completed visit to Kazakhstan is only an indicator of the consolidation of deeper tectonic shifts in Eurasian security and economic affairs. A new triangle is emerging in East Central Eurasian geo-economics among Russia, Kazakhstan and China. (It is being complemented by the emergence of another such triangle in West Central Eurasia among Russia, Turkmenistan and Ukraine.) Energy cooperation is a linchpin of each of the emerging triangular ententes, but the ententes themselves go far beyond energy.

В Евразии происходят глубинные тектонические сдвиги в области обеспечения безопасности и экономического сотрудничества.

After a slow start in 2002, the SCO's St.-Petersburg summit in May 2003 approved development of a military arm to assist SCO anti-terrorist cooperation. The organization’s first multilateral military exercise (called “Interaction-2003”) took place that August in Kazakhstan and China, although without Uzbekistan’s participation. In September of that year, the prime ministers of the member states agreed in Beijing to fund the SCO in the amount of $4 million during 2004, establishing its secretariat in Beijing (moved from Shanghai in accordance with a September 2002 decision) and the Regional Anti-Terrorist Structure in Tashkent (rather than Bishkek, and beginning operations in January 2004).

Question: What is your point of view on Iraq's near-term future? Will U.S. policy fail? And if so, will Iraq be divided?

Answer: The U.S. policy succeeded in removing Saddam Hussein, which was very important to the Kurds in Iraq. But further U.S. policy will fail if it seeks to destroy the secular and socially progressive aspects of the Iraqi culture, which include health care delivery, high literacy rates, education for girls as well as boys, etc.

Известный американский эксперт по евразийской политике профессор Роберт Катлер поделился своим видением развития геополитических и экономических процессов в Центральной Азии и Евразии с нашим внештатным корреспондентом Мавляном Юлдашевым.

[News article (Interview) first published (in Azeri translation from English) by Trend News Agency (Baku), 1 August 2008, under the by-line of N. Boqdanova.]

With Georgian government websites shut down by cyber-attacks in the days immediately preceding hostilities, the Russian story of its army coming to the defense of South Ossetia in the face of Georgian assault gained currency. This script is still often invoked as a preface to any commentary or reportage on current developments. However, as facts begin to surface, it is increasingly revealed as a propaganda strategy planned in advance and contradicted by evidence on the ground, by the testimony of neutral observers, and by the increasingly transparent cynicism of its purveyors.

Moscow's equity markets, whose benchmark measure has declined with increasing rapidity since the start of the year, have turned worse with Russia's invasion of Georgia. The dollar-denominated RTS index is down 33% in three months and the ruble-denominated MICEX is nearly as much off at 28% in the same period.

In mid-July, the Belgian prime minister Yves Leterme (Christian-Democrat Flemish party, CDV) tried to resign: for the third time. King Albert II once more refused to accept the resignation and appointed a three-person commission to resolve the deadlock. This week it reports back to him, although the verdict will not be known for some days.

Более ста лет назад сэр Халфорд Макиндер (Halford Mackinder) произнес знаменитые слова о том, что территории к востоку и северу от Каспийского моря могут стать "географической осью истории", выдвигая свою геополитическую теорию о евразийском "центре мира". Этот термин сейчас в равной мере применим и к Азербайджану, учитывая его роль на южном Кавказе. И вызвано это не только тем, что он обеспечивает самый надежный и самый эффективный транзит каспийских энергоресурсов на запад в Европу и за ее пределы.

Over 100 years ago, Sir Halford Mackinder famously identified territories to the east and north of the Caspian Sea as the "geographical pivot of history" in his Heartland Theory of geopolitics. Much of that territory corresponds to modern-day Uzbekistan, whose importance was rediscovered in the wake of the disintegration of the multinational Soviet state. The term could now equally apply to Azerbaijan's role in the South Caucasus, and not only because it provides the most secure and efficient transit of Caspian Sea energy resources westward to Europe and beyond.

The unrest in China's far-west region of Xinjiang, notably in the local capital of Urumqi, comes after 15 years of development and transformation of the area to be a geo-economic springboard for projecting influence into Central Asia and the Caspian region in the wake of the collapse of the Soviet Union.

The signing this week of a transit agreement to govern the Nabucco natural gas pipeline marks an important staging post in bringing to reality the long-touted energy route, which is projected to run 3,300 kilometers from the Caspian Sea region to Europe. Yet it is important to understand what such a transit agreement is intended to do - and what it is not intended to do.

Question: The future of Iraq is related to the success of the political process and national reconciliation among Kurds, Shiites and Sunnis. To avoid dictatorship of the majority, consensus democracy has been pursued in Iraq. What is your opinion as how this process will succeed and how these three main components of Iraq may unite?

In order to understand energy geopolitics in Asia, even in East Asia, it is no longer adequate to look westward to Central and Southwest Asia across the Arabian Peninsula to North Africa. A new, massive liquefied natural gas (LNG) development in Australia has just passed an important environmental hurdle, and China, India and Japan are lined up to be customers.

[Interview on Caspian energy security, broadcast in Azeri translation from the original English, and also published in Azeri by Azadlıq Radiosu (Baku), 29 September 2009, under the by-line of Arifə Kazımova.]

[This article is the Russian translation (from http://www.inosmi.ru) of the Bulgarian translation (from the newspaper 24 Часа [Sofia]) of the Georgian translation (from the newspaper 24 Ⴑაათი [Tbilisi]) of an interview originally conducted in English, on Caspian and Caucasus region energy security, in Tbilisi on 30 September 2009.]

В самом деле попросту американский ученый, однозначно научный работник Института европейских, отечественных и евразийских изысканий Университета Карлтон Роберт Катлер не считает потенциальным роль Армении в плане газопровода «Набукко».