STABILITY
IN AFGHANISTAN: A USA DREAM FOR CASPIAN ENERGY NEW CORRIDOR
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It seems, US
seeks different objectives to attack Afghanistan, where terrorism punishment
is just an excuse, where some politicians know, Afghanistan territory
stability a USA goal for preparing a secure energy corridor to isolate Iran
alternative passage (like what US done for baku –ceyhan[the proposed
Baku-Ceyhan oil line was not worth financing without massive subsidies from
some extra-regional power]). In this article I try to focus on this subject in
more details. Caspian
strategic situation: The
region is known globally for two key natural resources — oil and natural gas
reserves, and a caviar-producing fish population (sturgeon) Both are highly
valued export commodities, the sale of which can produce sorely-needed foreign
exchange which, in theory at least, can be used for economic development
purposes by the governments of the Caspian's littoral states. According to the
U.S. Energy Information Administration, proven and possible natural gas
reserves in the Caspian Basin comprises two-thirds of the region’s total
hydrocarbons. Caspian governments are in need of revenues hence Oil and gas
development has the potential to significantly help the new republics to
economic prosperity as well as political stability and independence. Indeed,
the key economic assets of Azerbaijan, Kazakhstan, Turkmenistan and Uzbekistan
are oil and gas reserves. The Caspian states have considerable potential wealth in
their hydrocarbon reserves, both onshore and offshore. But, in order to
realize that wealth, they must rely on neighboring countries for
trans-shipment of their resources from the region by way of oil/gas pipelines
and tankers. The biggest single obstacle to fabulous wealth in the region is
the lack of export pipelines. While there has been considerable Western
investment in the development and Transportation of Caspian oil, large-scale
investments in Caspian gas projects have not yet become Economically viable.
Based on an average consumption increase of 5% per year, Asian/Pacific demand
for oil is expected reach 33.5 million bpd by 2010. China alone could be
consuming 7.2 million bpd by 2010, and 10.7 million bpd by 2020, while oil
production in Asia/Pacific region may decline from its current level of 6.3
million bpd. where the demand for
oil is projected to grow fast. It is said that, the gas import demand for just
South Asia was 8.8 percent in 2000 and is expected to grow to 28.3 percent in
2005 and 54.9 percent in 2010.Some experts believe that More efficient use of
petroleum products and the supplement of alternative sources of energy might
lead to some decline in Western oil consumption, but there would be a very
substantial increase in the developing regions of Asia[1]
, Technology is starting to provide some of the answers (put forward by
environmentalists), with the development of both cleaner fuels and more
efficient use of oil, but would not resist the legitimate aspirations of
developing countries for growth and progress. With the increase in demand in
Asia, and with Caspian high hydrocarbon resources , the potential for trade
between the two regions is high. The lack of sufficient indigenous gas
reserves in Asia also makes trade with the Caspian (and Middle East )very
crucial. The growing role of the Asia/Pacific region will play a major
decision making role in the assessment of the Caspian region, with a vicinity
to emerging consumer nations such as India, Pakistan, China and Japan It is
apparent that the Middle East will not be able to meet Asian/Pacific demand by
then. The resources of the Caspian will become more prominent in the total
constellation. South
Asia Energy Demand Prospects: South Asia is important
to world energy markets because it contains 1.3 billion people and is
experiencing rapid energy demand growth .After India, Pakistan and Bangladesh
are the next largest South Asian countries in these categories. Economic and
population growth in South Asia have resulted in rapid increases in energy
consumption in recent years -- well above the rate seen in the OECD(Despite
rapid growth in energy demand, however, South Asia continues to average
amongst the lowest levels of per capita energy consumption in the world, but
among the highest in terms of energy consumption per unit of GDP). The major
energy issues facing South Asian nations today are keeping up with rapidly
rising energy demand . Agency for energy consumption has projected that by the
year 2010 South Asian countries shall be consuming more than double
the current levels of primary commercial energy. It
becomes self evident that South Asian countries would experience ever
increasing energy demands and they lack the resources
and capital to meet this demand. According to a World Bank report
(1994) the poor quality of South Asia’s energy infrastructure would be the
biggest obstacle to its economic development in the
coming years.On the other hand South Asia lies in the vicinity of countries
with rich natural gas and other resources. If long-term projections of rapidly
increased energy demand for South Asia are correct, the region will require
either significant increases in production, imports, or most likely both.
Given the economic attraction of pipeline transportation of oil and
gas, this becomes the most preferred means for import of natural gas into the
region from the neighbouring countries. However the pipeline to be established
for this purpose would require transit through more than one nation and in
order to achieve economies of scale sharing of gas supplies
among the countries becomes essential. A strong case in thus made for co-ordinated
action to meet the challenges and exploit the potential in the energy sector
in the region. Although India
is attempting to limit its dependence on oil imports somewhat by expanding
domestic exploration and production But Low
drilling recovery rates are a major part of the oil supply problem for India.
Indian consumption of natural gas From only 0.6 trillion cubic feet (Tcf) per
year in 1995 and 0.8 Tcf in 1999 is projected to reach 1.3 Tcf in 2005 and 1.8
Tcf in 2010. To pursue gas future demands, Although the Indian government has
encouraged further exploration of gas rich areas but it will be unable to meet
the increasing demand for natural gas and energy in India's near future due to
cost and industrialization factors. Given that domestic gas supply is not
likely to keep pace with demand, India will have to import most of its gas
requirements, either via pipeline or LNG tanker. Security of energy supply is
in this case of the utmost importance and a very critical point to be
assessed. Pakistan has only 21.6
Tcf of natural gas reserves, resulting in the production of 0.7 Tcf of natural
gas, which is exactly the same as the level of natural gas consumption in the
country. Presently, the Pakistani government still hopes the development of
new natural gas fields would serve to prevent the future energy crisis
predicted in the next four years. However, this hope falls short of the
reality, considering the environmental concerns expressed by pastoral peoples
as well as lack of industrial facilities to implement cultivation efforts[2].
As mentioned earlier, both India and Pakistan are comforted with the problem
of acute gas supply shortfalls. Pakistan’s natural gas resources are being
rapidly depleted with a projected shortfall of 1.6 billion cubic feet per day
by 1999. This shortfall is expected to double in the following decade.Both
countries have the advantage of bordering two major natural gas rich regions
the Persian Gulf and Central Asia. It is this geographical proximity that can
provide the basis for mutually beneficial co-operation India and
Pakistan western neighbour Iran possesses the second largest recoverable
reserves of natural gas in the world. Saudi Arabia the UAE and Qatar likewise
are endowed with huge natural gas reserves.Turkmenistan is a major producer of
natural gas. Options
to Meet The South Asia Future Demands: ·
OMAN OPTION:
1- A 1,144 Kilometre pipeline from Ras-Al Had in
eastern Oman extending across the surface of the Arabian Sea to the Indian
State of Gujarat. This pipeline would have an annual transmission capacity of
20 billion cubic metres. The governments of India and the Sultanate of Oman
have abandoned plans to lay a subterranean pipeline through the Arabian Sea
from Oman to the Indian coast. While officials have said the project was not
feasible, others argue that politics played a part If the option is for a
pipeline from Oman, then there will be no purchase of gas from Iran. ·
2- Instead of the proposed
gas pipeline project, Oman has now signed a contract to supply 1.2 million
tonnes of liquefied natural gas to India. ·
QATAR OPTION:
1-Two submarine pipelines have
been bruited. Both could bring gas from the large North Dome field in Qatar to
Pakistan; these proposals have been carried to the stage of semi-detailed
engineering study. They are deemed to be technically feasible, and both would
bypass Iran or Iranian waters, a feature that Washington and Tel Aviv view as
advantageous[while pipeline can traverse
Iran and Pakistan, and end in India, picking up Iranian gas along the way].
A 1,6 70 Kilometer pipeline from Qatar’s North Field extending through the
port of Diba in UAE from where it would follow a sub sea route to Karachi.
Daily transmission capacity of 1.6 billion cubic feet. Even though Pakistan has signed a preliminary agreement to
eventually purchase gas from Qatar, it seems increasingly unlikely that
Pakistan will be included in the project in the near-term, due to it financial
weakness and uncertainty about whether there will be sufficient demand growth. ·
2-Another option: Instead
of building a pipeline, one can liquefy the gas in Qatar or Abu Dhabi,
replicating plants that already exist, and ship the gas in cryogenic tankers
to Pakistan. The economics of short-haul liquefied natural gas trading are
favorable, especially since much of the capital is not necessarily dedicated
to a single customer, which is the case of the proposed pipelines.
·
1-Iran, looking more
broadly to commercialize its very large gas reserves in the South, has
proposed a line along the Makran coast, across Baluchistan, and connecting to
the Pakistan grid near Multan or Sui. This proposal is compellingly more
attractive because no “third-party transit” is involved. The producer
delivers directly into the territory of the buyer. It is not without risk. The
line is exposed for 600–800 kilometers through Pakistani Baluchistan where,
once again, local rebellions have festered since before independence.
Nonetheless, this option is viewed as less risky than that the Afghanistan
one. According to officials in the
Musharraf government, the project would earn Pakistan up to $150 million a
year in transit fees. Equally important is Pakistan's consideration that the
pipeline could offer some political leverage against India.But India, which is
suspicious of Pakistan's intentions, has informed Iran that New Delhi and
Tehran should look at other options for the delivery of Iranian gas to the
Indian shore. It has suggested that the gas be shipped by tankers to an Indian
port on the Arabian Sea. Tehran, however, appears to favor the pipeline
project. New Delhi fully realizes that such a pipeline can be used by
Islamabad at critical times to harass New Delhi . Within India, public
protests are raging against internal gas pipelines, most notably in Gujarat,
where farmers oppose a plan to build a pipeline connecting various districts.
Apart from complaints that they were not given compensation, the farmers
insist that digging up the entire area for the gas line will reduce the region
to wasteland. There are four major ways considered for sending gas from the
Persian Gulf to India:
1-Offshore from Persian Gulf to the Gulf of Oman and India 2-Onshore
and offshore, from Iran and along the Pakistani coast to India 3-Onshore,
from Iranian gas fields terminal at Assaluyeh to Pakistani boarder and through
Pakistan to India. 4-Shipping
of liquid natural gas (LNG) from Iran to India by tankers (Iran is going to
install large facilities to export LNG of South Pars field to abroad)[5]. Non of these projects ever went beyond desk studies for various technical, financial and political reasons. ·
2-oil swaps: Iran itself
considers Turkmenistan and Kazakhstan oil swaps by which Central Asia ships
its crude oil to Iran's north and Iran then exports the same quantity of its
own oil from the south. Under this arrangement, Caspian oil would be shipped
to Iran's Caspian Sea ports, and transported via pipeline, rail, and tanker
trucks to refineries located in northern Iran, with the oil exported instead
from Iran's Persian Gulf ports on the oil producer's behalf. Kazakhstan signed
an agreement in 1996 to begin oil swaps with Iran, although volumes were
limited by contract and technical issues, including the initial problems by
Iranian refineries in processing Kazakh crude oil. With the resolution of
these issues, oil swaps of 40,000 bbl/d could resume in the near future.
Volumes could increase further with the completion of an oil pipeline project
that would increase transport capacity from the Iranian Caspian Sea port of
Neka to Tehran and tie into the existing Iranian pipeline network. ·
3-One
option would be to construct a pipeline from Kazakhstan through Turkmenistan
to the middle of Iran, connecting to Iran existing pipeline network that could
be used to transport oil south to Iran's Persian Gulf ports. Turkmenistan and
Iran, have been actively discussed for almost a decade at the academic,
Government, and industry levels. Although pipelines would have to traverse a
distance of at least 1500 kilometers from Turkmenistan and Iran to India,
existing networks of pipelines within Iran Can be extended to partly offset
costs. ·
Bangladesh
OPTION:
Another possible import route would link the gas reserves of Bangladesh
into the Indian gas grid. The discovery of natural gas reserves off shores
of Bangladesh have added new potential source of natural gas to be imported
into India. ·
One of the less probable options
, would be to have a pipeline between Baku and Chah Bahar in Pakistan. The
length of this route is 2,400 km, requiring a 52-inch pipeline, with a
capacity of 2 million bpd. Projected costs are $4.4 billion. Operating costs
will be $0.52 per barrel for the pipeline and $0.04 per barrel for the
terminal. The second possibility is a pipeline between Kransnovodsk-Baku down
to the port of Dayyer (Iran). The length of this route is 2,000 km and
requires an 24-inch pipe with a capacity of 400,000 bpd. Costs of this project
are $1.1 billion. Afghanistan: Afghanistan in general view: The
total population of Afghanistan range between 15-20 million, including
refugees in other countries. More than 99.9% of Afghan people are Muslim,
about 20% Shieia and 80% Sunni Muslims. Non-Muslim groups, including Hindus,
Sikhs, and Jews make up less than 0.1% of the population. The climate in
Afghanistan is dry with four seasons, including hot summers, cold winters and
heavy snow year-round in the mountainous regions. Many years of war and
political instability have left the country in ruins, and dependent on foreign
aid. Over two decades of conflict have reduced landlocked Afghanistan to one
of the world’s most impoverished nations. Rampant inflation has been
reported. A great majority of the Afghan
labor force is self-employed, mostly in agriculture and domestic trade but
also, to a smaller extent, in cross-border trade. While the Taliban’s
refusal to allow women to work or acquire an education effectively cuts the
workforce by more than half. The majority of the population continues to
suffer from insufficient food, clothing, housing, and medical care. Three
years of drought, 22 years of conflict, and five years of brutal Taliban
misrule, have brought untold suffering to millions of people.The long drought
has caused the near-total failure of rain-fed crops in 18 of 29 provinces.
Thirty percent of Afghanistan's irrigation infrastructure has been damaged or
fallen into disrepair, rendering about a half of the irrigated lands unusable.
Despite above-mentioned reality the main source of income in the country is
agriculture. During its good years, Afghanistan produces enough food and food
products to provide for the people, as well as to create a surplus for export.
However, even in times of peace the agricultural base is very narrow—the
soil is fertile but water is scarce, only about 12% of land is cultivated and
only one-third of that is irrigated, the rest being mountains and deserts.
Afghanistan is well endowed with minerals. Mineral wealth is virtually
undeveloped, except for natural gas, which is produced in exportable
quantities. There are deposits of iron ore, coal, copper, talc, sulfur,
emeralds, gemstones and lapis lazuli; oil fields are found in the north.
Natural gas, fruits and nuts, lambskins (Karakul), and hand woven carpets have
been the main exports; As a result of civil war, exports have dwindled to a
bare minimum; an illegal trade in opium (which Afghanistan is among one of the
world's major producers [Afghanistan produced over 70 percent of the world's
supply of illicit opium in 2000. Narcotics are the largest source of income in
Afghanistan due to the decimation of the country's economic infrastructure
caused by years of warfare.]) and hashish has continued. Additionally
Afghanistan occupies a strategic geographical position as a transit route for
Central Asian hydrocarbons to the Arabian Sea. Current
Energy Situation Of Afghanistan: The
Soviets estimated Afghanistan’s proven and probable natural gas reserves
at up to 5 trillion cubic feet (Tcf). Current Afghan gas production remains
around 30 Mmcf/d, all of which is used domestically.Soviet estimates made in
the late 1970s placed Afghanistan’s proven and probable oil and condensate
reserves at 95 million barrels. Despite plans to start commercial oil
production in Afghanistan, all oil exploration and development work as well
as plans to build a 10,000 barrel per day refinery were halted after the
1979 Soviet invasion. Besides oil and natural gas,
Afghanistan also is estimated to have 73 million tons of coal reserves, most
of which is located in the region between Herat and Badashkan in the
northern part of the country. At its peak in the late 1970s,
Afghanistan supplied 70%-90% of its natural gas output to the Soviet Union's
natural gas grid via a link through Uzbekistan. In 1992, Afghan President
Najibullah indicated that a new natural gas sales agreement with Russia was
in progress. However, several former Soviet republics raised price and
distribution issues and negotiations stalled. In the early 1990s,
Afghanistan also discussed possible natural gas supply arrangements with
Hungary, Czechoslovakia, and several Western European countries, but these
talks never progressed further. Afghan natural gas fields include
Jorqaduq, Khowaja Gogerdak, and Yatimtaq, all of which are located within 20
miles of the northern town of Sheberghan in Jowzjan province.
Petroleum products such as diesel, gasoline, and jet fuel are imported,
mainly from Pakistan and Turkmenistan. In
late September, 1999, the Taliban signed an exploration agreement with a
Greek firm, ECC. The contract obliges ECC to conduct seismic and other
exploration in southwest Afghanistan, which is considered to be highly
prospective. The
importance of Afghanistan corridor: Afghanistan
has some oil and gas of its own, but not enough to qualify as a major
strategic concern. Its northern and western neighbours, by contrast, contain
reserves which could be critical to future global supply. The importance of
Afghanistan may grow in the coming years, as Central Asia’s oil and gas
reserves begin to play a major role in the world energy market. The
potential for demand growth in the Asian market is nearly unlimited at
prices that both buyers can pay and suppliers can profit. This is in sharp
contrast to routes to Europe where the regional producers would likely find
intense competition among themselves for a limited market. Russia,
Turkmenistan, Kazakhstan, and Uzbekistan have all publicly noted their
interest in working jointly toward an eastern corridor. In the first stage
of development, Turkmenistan is likely to provide most or all of the gas,
with incremental supplies coming later from other countries. Since Pakistan
and India's demand for gas has nearly no ceiling --at prices around of $2
per mmBtu-- several suppliers could be considered once Turkmenistan gets the
export ball rolling. The final price of the gas will be an issue, but since
Pakistan does not have access to any competing supply and is desperately in
need of incremental volumes, negotiations could progress more rapidly than
those with oversaturated European buyers.
Competition in the European market is quite intense, and while buyers
might welcome another supply source, there is more than enough gas available
for quite some time from existing suppliers such as Russia, Norway, Algeria,
the Netherlands and the UK.
Russia, for its part, has displayed an inclination to prevent Turkmen gas
from reaching Europe, as it would constitute direct competition in eastern
and southern Europe over a similar or even shorter distance.Competition or
liberalization in Europe would be a double-edged sword for Turkmenistan and
its Caspian brethren. On the one hand, gas on gas competition opens up the
possibility of marketing opportunities in Europe. However, competition is
also likely to lower price, which means that it will be even harder to
Caspian suppliers to beat existing baseload suppliers on price.Afghanistan
could prove a valuable corridor for this energy as well as for access to
markets in Central Asia. In addition, Afghanistan can serve as a trade link
between Central and South Asia. Washington is against sending the fuels from
the landlocked states in pipelines through Iran.Since the next best route as
US opinion ran through Afghanistan. The
prospective source of supply exists; that is incontestable, and Pakistan
does indeed need energy.Further, ironically, the pro forma economics
of the trans-Afghan pipeline are positive. The distance is relatively short,
and the terrain is not particularly difficult or challenging. The
proposal involves building both oil and natural gas pipelines through
western Afghanistan to connect with the pipeline networks in Pakistan.
Central Asia oil&
Gas pipeline project: OIL:Turkmenistan
has signed a memorandum of understanding with Afghanistan and Pakistan to
build a 1 million bbl/d pipeline to carry petroleum to Pakistan and world
markets via Afghanistan. The proposed pipeline
would connect the Caspian Sea, Western Siberia, Kazakhstan to Pakistan,
India, and the Asian pacific countries. In October 1997, a tripartite
commission comprising the Islamic State of Afghanistan, Turkmenistan, and
Pakistan was formed to start work on building this pipeline. No progress was
made on these pipelines due to the ongoing
war in Afghanistan. Following the August 20, 1998 U.S. bombing raids
on suspected Afghan strongholds of suspected terrorist Osama bin Laden,
Unocal announced that it was suspending work on the pipelines, and in
December 1998, it withdrew from the consortium (comprising the Turkmenistan
government, Delta Oil (Saudi Arabia), Itochu (Japan), Pakistan's Crescent
Group, Hyundai (South Korea), and Japan's Indonesia Petroleum Company). GAS:In
July 1997, Turkmenistan signed a memorandum of understanding with
Afghanistan, Pakistan, and Uzbekistan to build a Central Asia Gas (Centgas)
pipeline to carry 0.7 Tcf per year of natural gas to Pakistan via
Afghanistan (and possibly to India as well). However, the withdrawals of
consortium members Gazprom in June 1998 and Unocal in December 1998 left the
project in limbo. In April 1999, Pakistan, Turkmenistan and Afghanistan
agreed to reactivate the Centgas project, and to ask the Centgas consortium,
now led by Saudi Arabia's Delta Oil, to proceed.
The
U.S.A objectives in Introducing a new energy
corridor: Islamabad
and Washington backed the Taliban as they swept to power in 1996. Without
Pakistani support in the form of money, military supplies, advisors,
fighters and even some regular troops, the Taliban could not have achieved
power, nor would bin Laden have had the sanctuary from which to plot against
Americans. Islamabad has consistently tried to install governments in
Afghanistan that not only protect its interests, but would also be the most
malleable to them to create the stability that the laying of lucrative
pipelines for Central Asian energy resources requires. The Taliban regime is
a product of the civilized world and the international community. The
Taliban were acceptable at first, but then Osama bin Laden entered the
equation, who began training anti-Western guerrillas in Afghanistan .
Pakistan's Central Asian policy, if there is one, hangs on its Afghan
policy, which in turn depends on Taliban and American policy of containment
of Iran. Under this policy United States announced sanctions against all
companies, whether American or not, that does business with Iran . In short,
the American quarantine of 1995-6 is not holding" Pakistan's only
visible and concrete, expected gain in this whole game were the plans of a
pipeline from Turkmenistan to Pakistan via Afghanistan. Just when Taliban
apparently poised to take over the whole of Afghanistan, UNOCAL announced
the suspension of its plans to construct the much trumpeted pipeline. The US
firm Unocal had its fingers in another ambitious project that would pump
Turkmenistan's abundant natural gas through Afghanistan to the ever-growing
markets of Pakistan and India. By
the way, American objectives in the Middle East are two-fold: Protect
Israel, and stabilize the region (and thus protect the free export of oil).
Afghanistan and its neighbors are important to the United States for many
reasons. The region around Afghanistan is rich in oil and gas, which, if it
can be exported, will help the Central Asian states consolidate their
independence and develop economically. But chaos emanating from Afghanistan
has fostered political instability and made economic progress more
difficult. On
the other hand, The trend has major implications for the United States and
global energy supply patterns if countries like China and India increasingly
Tap into Middle East oil supplies to meet growing demand. The U.S. policy is
set for a route which excludes Iran and Russia. Although
an alternative transit route would be through Iran to the Gulf BUT the
U.S. is still seeking to limit Iran’s influence and wants to see
Turkmenistan’s oil and gas exports take pipeline routes other than through
Iran and Russia. Since the end of the Cold War the
United States has viewed Iran as one of the major adversaries. Hence for
years the U.S. policy towards Azerbaijan and Central Asia has apparently
been aiming at isolating Iran, if needed complying with some of Russia’s
interests. For example, in 1995, the United States government vetoed any
Iranian participation in the Azerbaijan oil consortium, but accepted a
Russian participation. By accepting a transit route through Iran, the United
States would recognize Iran as a major power in international oil politics,
in the Gulf and in Central Asia. By accepting a stronger Russian stake, eventually the transit
through Russia to Central and Western Europe, the United States would
achieve its objective of diverting the Azeri and Central Asian crude from
the Gulf. This would, however, also strengthen Russia’s position in the
world energy markets and imply at least a tacit acceptance of the return of
Russia as the dominant power in the Caspian Region and Central Asia. But
pipelines through Afghanistan
would allow the US both to pursue its aim of "diversifying energy
supply" and to penetrate the world's most lucrative markets. Afghanistan
ceased to be of strategic interest to the U.S. after the Soviet withdrawal
and, most decisively, after the collapse of the USSR. Since then the U.S.
government has mainly defined its interests in Afghanistan as “drugs and
thugs. The U.S. opposes all efforts by Iran to capture a share of Central
Asian trade and to serve as an outlet to the market for Central Asian oil
and gas. In September, a few days before the attack on New York, the US
Energy Information Administration reported that "Afghanistan's
significance from an energy standpoint stems from its geographical position
as a potential transit route for oil and natural gas exports from Central
Asia to the Arabian Sea. As the researcher Keith Fisher has pointed out, the
possible economic outcomes of the war in Afghanistan mirror the possible
economic outcomes of the war in the Balkans, where the development of
"Corridor 8", an economic zone built around a pipeline carrying
oil and gas from the Caspian to Europe, is a critical allied concern.When
the countries of the Caspian region began to turn their attention toward
Iran as an exit route for their oil and gas, the United States granted their
leaders official visits. Between July 1997 and April 1998, Presidents Aliyev
of Azerbaijan, Nazarbayev of Kazakhstan and Niyazov of Turkmenistan, all
passed through Washington to hear the U.S. government lecture them about
alternative export routes. By November 1997, east- west oil routes and the
Baku-Ceyhan pipeline, bypassing Iran, had become the new religion in the
Washington policy- making community. A TransCaspian gas pipeline was touted
as the solution for Turkmen gas to access Turkey, so as to avoid Iran. The
United States would like to prevent Turkmenistan from increasing its
reliance on an Iranian exit route. Turkmen gas production in 1997 collapsed
to one-fifth the levels reached in the early 1990s, causing enormous
financial losses. The only way for Turkmenistan to rectify this situation in
the near future is to begin looking for market access in and across Iran.
But with east-west oil routes looking increasingly questionable the United
States is staking its claim to east-west gas routes.The isolation of Iran is
over for all but the United States. With the issuance in May 1998 of a
national-security waiver for Total, Gazprom and Petronas and their
investment in Iran's South Pars gas field, the U.S. policy of excluding Iran
from the Caspian also began to unravel. Since then, two non-U.S. companies
have begun to ship some oil from Turkmenistan on an exchange basis into
Iran. The oil is sent to Iran's Tehran refinery, with the companies
receiving comparable volumes at Iran's southern port of Kharg Island.Some
other important energy projects by foreign companies in Iran territory is
mentionable. But we should not neglect some realities. For instance and At
the end, with an overview of last mentioned issues, probabilities for
Afghanistan corridor option, continues U.S.A efforts to isolate I.R.Iran
route, and Caspian basin countries in transparent policies regard Iran,
should make Iranian officials to find proper remedy to prevent baku-ceyhan
repetition. Sources: 1-
Hill and Specter,”The Caspian Basin and Asian Energy
Markets”, s e p t e m b e r 2 0 01. [1] -
As various international energy forecasts predict an increase in energy
demand for oil in the years to come, the Caspian region is and will become
more and more prominent as one of the prolific regions in the world.
Meanwhile this fact should not be neglected that: Growth in European oil
consumption is slow and competition is intense. In south Asia, by
contrast, demand is booming and competitors are scarce. Pumping oil south
and selling it in Pakistan and India, in other words, is far more
profitable than pumping it west and selling it in Europe. [2]
-In the other hand some experts state that:
the gas reserves in Balouchistan are dwindling fast, and are predicted to
fall critically short by 2010. Therefore, Pakistan remains desperate for a
fresh supply of natural gas, at favorable economic terms (read very
cheap), which is not an option for any gas coming from Iran. With cost of
debt consuming over 53 percent of its GDP, Pakistan simply cannot afford
gas at market prices. The sea route is not an option either; Pakistan
cannot afford expensive liquification and regassification plants necessary
in order to import gas via the sea from the Pakistan-friendly United Arab
Emirates. Since the cost of each a liquification plant or a
regassification plant runs about $1 Billion each, and the cost of an LNG
tanker is approximately $250 million, the strategic value of CentGas in
cold cash terms is $2.25 Billion for Pakistan. Hence, the options for
Pakistan are few. 3-
The pipeline was supposed to carry gas from the Turkmen Dauletabad fields,
among the world's largest, to Multan, southwest of Lahore. It is estimated
that Dauletabad could produce 15 billion cubic feet of gas per year for 30
years. [4] - Favored by Iran and oil companies, the Iranian southern routes make economic and commercial sense. They are cheaper to build, pass safer territories, and pose no serious environmental hazard. Significant pipeline and port infrastructure also exists. Extensive oil pipelines south of Iran also exist as do port facilities in the Persian Gulf from where both Europe and big Asian market could be efficiently served. Most notably, the Iranian route also offer the swap option, something no other routes have offered as yet.Oil companies and governments worry that the southern option increases the world's reliance on the Strait of Hormuz, a concern that can be addressed by linking the pipelines to the port of Jask on the Oman Sea. Certain geologists have also argued against the line because of possible seismic problems in Iran. Yet, in the last several decades earthquakes have not posed problems for the pipelines in Iran 1
- The cost of transmitting 30bcm per year of gas from Iran to Indian
sub-continent would be in the onshore of $3 billion considering the land
route. If we consider the option of a combination of land and sea from
Iran to shallow waters of Pakistan and then Indian land it would be about
$4 billion. The pipeline which bypasses Pakistan through deep sea needs
$4.4 billion. It covers $3.6 billion for pipe and $800 million for
compressors. |
In
addition to regional advantages, the pipeline offers specific benefits to
the countries involved. Turkmenistan will reach new markets with its
plentiful gas reserves, while Pakistan gains a reliable source of
clean-burning fuel to drive its economic growth. Afghanistan will earn
extensive economic benefits from the pipeline, both during construction and
over the life of the project. The transit fees seems to be low, at least
during the costly front end years of the operation, because Afghanistan
would rather have a low transit fee than none at all. By contrast, Iran
would be more likely to peg its transit fee closer to the opportunity cost
of moving the gas through Russia or Azerbaijan. While obvious
disadvantageous for project is imaginable . For instance the people of
Afghanistan paid a big price to the environmental and social impacts of the
Red Army's pipelines during 80's. Yet, after many years, the damages, caused
by this pipeline on agricultural lands, water system and other life
sustaining elements of the environment, are not recovered. The black scars
of oil spills, fires and fighting scenes are still visible on the landscape
of Afghanistan. The major environmental and social impacts of cent-gas
project could arise during the exploitation and abandonment stages. It is
speculated that the following environmental factors would be greatly
affected by the extension of this pipeline in the territory of Afghanistan:
the population and habitat expansion, the volume of the social services in
the region, the productivity of farmlands, pastures and other agricultural
activities in the surrounding areas of the pipeline route, soil and
vegetation covers, conservation of water resources and wildlife
conservation. 