Gazprom CEO Alexey Miller (left) with Kazakh President Noursultan Nazarbaev
Photo: Ilya Pitalev
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Russian Transit Monopoly in Central Asia Broken
The Russian monopoly on the transit of energy resources in Central Asia took two major hits last week. On Thursday, the U.S. State Department announced that it awarding a $1.7-million grant to prepare a feasibility study of the Transcaspian Pipeline from Turkmenistan to Azerbaijan and of a oil pipeline across the bottom of the Caspian Sea to connect Kazakhstan to the Baku-Tbilisi-Ceyhan pipeline. Then, on Saturday, Chinese President Hu Jintao and Kazakh President Noursultan Nazarbaev reached an agreement on the construction of an oil pipeline to connect the Caspian with China and on laying a gas pipeline from Turkmenistan through Kazakhstan to China.
The Baku-Tbilisi-Ceyhan pipeline, competed in 2005, was the first outlet for oil from the former Soviet Union that bypassed Russia, which fiercely opposed its construction. The Baku-Erzurum natural gas pipeline, completed the same year, hold the same honor for that hydrocarbon. Now those lines are being extended. Deputy head of the Gazprom information policy department Sergey Kupriyanov said of the gas pipeline plans that “That decision in no way affects Gazprom plans. The fact that financing was provided by the U.S. State Department once again proves that the Transcaspian Pipeline is a purely political project. They make accusations against us that Gazprom is a political instrument and then openly give money for a feasibility plan at the same time.”
Troika Dialog analyst Valery Nestrov commented that “The project can be implemented only through the political will of the leaders of Turkmenistan and Kazakhstan, even if their economies suffer somewhat.”
The European Nabucco project to provide natural gas from Central Asia bypassing Russia, which the new pipeline will support, looked like a lost cause until recently. Russia signed agreements with Kazakhstan, Turkmenistan and Uzbekistan to buy 40 billion cu. m. of gas per year through 2011, thinking that that would encompass the region's full output. However, the ink on those agreements was hardly dry when those countries' presidents announced that there was enough gas for all and continued with the Western projects as well. Nabucco is to go into operation in 2011, the same year Gazprom's agreements in Central Asia expire. Now China has been added to the mix as well.
www.kommersant.com
All the Article in Russian as of Aug. 21, 2007
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