Caspian: Experts Urge U.S. Policy Change

[Michael Pugliese <debsian@xxxxxxxxxxx>]

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#2
Caspian: Experts Urge U.S. Policy Change
By Andrew F. Tully

The oil and natural gas waiting to be extracted from beneath the Caspian Sea
is a subject of great interest among policy analysts in the U.S. as
Americans
contend with their current energy pinch. It was the subject at a forum on 24
May in Washington. RFE/RL correspondent Andrew F. Tully reports that the
analysts attending the event believe that the American government must
modify
its foreign policy or its citizens will not benefit from that wealth of
energy.

Washington, 25 May 2001 (RFE/RL) -- Participants in a forum on Caspian Sea
energy agree that the U.S. should modify its policy on the Caucasus and
Central Asia. They say this would benefit not only the energy-hungry U.S.,
but also the two Eurasian regions.

U.S. Senator Chuck Hagel (R-Nebraska) began a forum on 24 May at the
Brookings Institution -- a Washington think tank -- by urging what he called
fundamental change in Washington's foreign policy toward the two regions.

Hagel said it should begin by repealing Section 907 of the Support of
Freedom
Act, which forbids U.S. aid to Azerbaijan because members of the U.S.
Congress accuse Baku of ignoring its people's civil and political rights.

"We should repeal 907. In fact, I think it exacerbates the problem, it
allows
us limited influence [in Azerbaijan] and it's counterproductive to what we
claim we would like to see over there."

Hagel said Washington also should reconsider economic sanctions against
other
countries, including Iran. He noted that Iran and Libya are the subject of
one set of sanctions, the Iran-Libya Sanctions Act of 1996. But he argued
that these two countries should not be equated. Besides, he said, unilateral
sanctions seldom achieve their stated goals.

The senator said it is time to explore ways of improving relations with both
Iran and Libya -- particularly with Iran. But he stressed that such
improvement cannot come quickly or easily.

"Now I realize that this is a two-way street. We can't will that, we can't
invent that, we can't unilaterally say, 'This is the way it will be.' But we
can be more resourceful and more imaginative than we have been in the past."

Another participant was Suzanne Maloney, a Brookings analyst of Iranian and
Central Asian issues, who said the U.S. might be pleasantly surprised if it
made further positive overtures to Iran. She said she believes that Iran's
reformist president, Mohammad Khatami, has made his country far more
pragmatic than anyone expected. Therefore, if he is re-elected in next
month's elections, she said he may very well be receptive to U.S. goodwill.

Maloney emphasized that her opinion is not shared by many other analysts.
But
she agreed that a positive approach to Iran is an essential part of a new
U.S. foreign policy.

All the participants in the forum agreed that the best way to improve
relations with countries in the Caucasus and in Central Asia is to help them
improve their economies. And the best way to do that, they said, is to help
them develop their most valuable natural resources -- Caspian oil and
natural
gas.

A third participant was S. Frederick Starr, chairman of the Central
Asia-Caucasus Institute at Johns Hopkins University's campus in Washington.
He said the most efficient way to develop Caspian energy is to move quickly
to build the proposed Baku-Ceyhan oil pipeline. The conduit would carry oil
from Baku -- Azerbaijan's capital on the Caspian -- through Georgia,
terminating at Turkey's Mediterranean port of Ceyhan.

But Starr and others said this pipeline and other ways of developing the
region's oil wealth are hampered by instability in the region. This includes
not only Georgia's internal strife in the Ossetia region -- which threatens
to destabilize the Caucasus -- but also the continuing fighting in
Afghanistan, which threatens Central Asia's stability. And they cited the
long-standing friction between India and Pakistan, both of which have
nuclear
arsenals.

Starr said the pipeline's benefits to the energy-producing countries in the
Caucasus and Central Asia go far beyond developing their oil wealth.

"We should be greatly concerned with issues of economic development as such.
And why? Because the dominant, the overwhelming issue in the region -- and
it's deepened [become more of an issue] -- is poverty, especially rural
poverty."

According to Starr, this is the only way to ensure long-term stability in
the
region.

Starr agreed with Hegel that the U.S. must change its approach to the two
regions. He said Washington should not be concerned that Azerbaijan and the
Central Asian states are centers of Islam. In fact he said, the U.S. should
disregard its negative experience with many other Muslim states and work
with
these countries within their Muslim context.

"The U.S., it seems to me, has a very real interest in helping these states
as they seek a way of being Muslim, moderate, and modern."

But a fourth participant -- Stephen Cohen of the Brookings Institution --
told the audience that he is not optimistic that the Baku-Ceyhan pipeline
will soon be a reality. He said the region is still too unstable,
particularly because of Afghanistan and the antagonism between India and
Pakistan.

"I'm not optimistic that we're going to see much movement on pipelines soon.
It is, I think, still a pipe dream."

And all the participants said that whenever the Baku-Ceyhan pipeline becomes
operational, they should not assume that Caspian energy will be destined
mostly for the West. For example, Kazakhstan has indicated that it will
continue exporting some of its oil through a pipeline in Russia. And there
will be other customers seeking the petroleum products from the region:
India, Pakistan, and even China.

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http://www.nixoncenter.org/Program%20Briefs/vol7no3bjones.htm

"Caspian Policy and the Future of the BTC Pipeline"
A Presentation by Ambassador Beth Jones
Special Advisor to the President and Secretary of State for Caspian Basin
Diplomacy

The Nixon Center, Washington, DC
January 31, 2001

"The Bush Administration has clear and assertive objectives guiding its
policy on the Baku-T’bilisi-Ceyhan (BTC) pipeline, which will transport oil
west from the Caspian Sea into Turkey." Special Advisor to the President and
Secretary of State for Caspian Basin Diplomacy Elizabeth Jones outlined
these objectives at a luncheon held January 31 at The Nixon Center.
Ambassador Jones expressed her enthusiasm toward the progress of the BTC
pipeline, its possibilities, and the role of the United States in its
success. Geoffrey Kemp, Director of Regional Programs at the Nixon Center
moderated the discussion.

Pipeline Investment

Ambassador Jones reported that basic engineering planning for the BTC
pipeline has already started. She explained that this is a positive first
step because it means private companies, responsible to their boards of
directors and shareholders, are "willing to put money on the table." During
the next phase the United States will persuade the eight sponsor companies
to commit to detailed engineering proposals which will require greater
financial investment. Ambassador Jones specified that commercial viability
must be evident before the next stage of development can be decided. The
sponsor companies must show they have the necessary financing to ensure a
functional commercial framework.

Ambassador Jones added that the principal advantage of the BTC pipeline to
investors is its route, which enables it to bypass the Turkish Straits. She
said that while Turkey will not restrict traffic through the Straits, there
is a limit to the quantity of material that can be transported through the
Bosporous. In addition to the large number of vessels that travel through
this crucial waterway, geographic obstacles include twelve sharp and rocky
curves, rapid currents, and narrow channels. The BTC pipeline will bypass
this "geopolitical chokehold."

Pipeline Future

In addition to promoting the continued investment of companies in Caspian
energy, Ambassador Jones said that the United States will continue to
support the sovereignty and independence of the Caspian countries and to
promote their economic interdependence.

The current focus of the United States in this respect is Kazakhstan,
considered the "east anchor of the east-west transportation corridor."
According to Ambassador Jones, by signing the Istanbul Declaration,
Kazakhstan has indicated serious interest in the new pipeline which would
include a trans-Caspian section linking Kazakhstan’s oil fields to the BTC
pipeline. In order to facilitate good will among the Caspian countries and
possibly incorporate Kazakhstan into the design, the US is assisting
Kazakhstan’s effort to join the new pipeline and will assure transparency
throughout the process. In addition, Ambassador Jones reported on plans for
a multilateral agreement, soon to be produced by Turkey, Georgia, and
Azerbaijan, which will further facilitate economic interdependence among the
Caspian countries.

Ambassador Jones also stressed the importance of maintaining contact with
Russia throughout the construction process of the pipeline. She said that
this communication will help demonstrate to Russia and Russian oil companies
the potential for alternate exit routes for Caspian oil. It is not US policy
to exclude Russia from pipeline opportunities, but rather to encourage
Russian companies to participate.

Finally, Ambassador Jones noted that talks focusing on transporting Caspian
energy to Europe through new pipelines have been renewed. She said that
demand for gas is particularly high in Europe and will continue to grow.
Therefore, Europe will, in all likelihood, need to find additional sources
of gas to satisfy its energy requirements. Ambassador Jones predicted that
the trans-Caspian gas pipeline could be an additional resource for supplying
this extra gas to southern Europe by way of Turkey.

This Program Brief was prepared by Nixon Center intern Chelsea Petersen.

http://www.nixoncenter.org/Program%20Briefs/vol7no3.pdf

http://www.cpusa.org/articles/The%20name%20of%20the%20game%20is%20oil.htm

Former Yugoslavia:


The name of the game is OIL!

& the prize is profits

By Karen Talbot

People's Weekly World

www.pww.org


The Bush administration, with its spectacular connections to oil and energy
corporations, is telling the U.S. people they need more oil, gas and nuclear
power to meet the so-called "energy crisis." It is becoming unmistakeable
that events in the Balkans, including the recent terrorist attacks in
Macedonia, have been directly related to this drive for ever greater sources
of oil and profits.

Not only do the people of the former Yugoslavia continue to pay an enormous
human price, but U.S. consumers and taxpayers are shelling out huge sums
that ultimately enrich these corporations. The intensifying civil war in
Macedonia is a case in point.

Terrorist assaults in the Former Yugoslav Republic of Macedonia (FYROM) by
the so-called "National Liberation Army" (NLA) have resumed and greatly
escalated in recent days with major ambushes, including against security
forces near Kumanova. The FYROM government troops have responded with a
major offensive to counter the terrorists.

The ethnic Albanian terrorists have been engaging in fierce attacks in the
rugged mountains of Macedonia, not only targeting Serbs and Macedonians, but
also Albanians who oppose them. Their actions have been criticized by
Western powers as threatening to ignite a wider Balkan conflict. But is
there a hidden agenda?

Though the U.S. administration says it opposes the recent terrorism in this
region, they have not stopped these attacks, which are initiated from the
Serbian province of Kosovo. This is despite the overwhelming KFOR presence,
including U.S. forces stationed at Camp Bondsteel the huge military base in
Kosovo, conveniently located in this vital area.

The NLA forces are openly acknowledged to be connected with the Kovoso
Liberation Army (KLA), which has consistently been backed by the U.S. and
NATO troops occupying Kosovo. This alliance has persisted despite the KLA's
continuing widespread attacks on Serbs and other non-Albanians in Kosovo and
its widely known criminal and drug-trafficking activities.

The KLA was nominally transformed into the Kosovo Protection Corps (KPC),
which is trained by Military Professional Resources, Inc. (MPRI), made up of
former U.S. military officers, based in Alexandria, Va. The MPRI also had
been involved in the training and command of the Croatian military that
forced over 200,000 ethnic Serbs from the Krajina region of Croatia in 1995.

It is curious, therefore, that NATO Secretary-General George Robertson
described the ethnic Albanian NLA fighters as "a bunch of murderous thugs
whose objective is to destroy a democratic Macedonia and who are using
civilians as human shields." Are they not thugs when engaging in similar
behavior in Kosovo?

The current attacks in Macedonia have centered very near the boundaries
between Macedonia, Kosovo and the Presevo Valley in southeast Serbia. This
valley is a narrow strip of land between high mountain ranges that border
Kosovo on the west and Bulgaria on the east. It is a strategic route that
has been used for centuries for commerce and passage for armies between
Europe and the Middle East.

It is now becoming clearer than ever that a primary reason the U.S. has been
so involved in Kosovo, Bosnia and throughout Yugoslavia, has much to do with
the immense wealth to be gleaned from oil.

Construction of a major "trans-Balkan" pipeline is underway from Burgas in
Bulgaria on the Black Sea, through Macedonia, to the Albanian Adriatic port
of Vlore. It is being built by U.S.-owned Albanian-Macedonia-Bulgarian Oil
Corporation (AMBO) and is scheduled to be operational by 2005.

The trans-Balkan pipeline passes through what is known as corridor 8 -
traversing very near the borders between Macedonia, Kosovo and the Presevo
Valley (see map). Furthermore, it is to be connected with another series of
pipelines, some of them Soviet-era pipelines. A major one of these will pass
down the Presevo Valley - known as corridor 10 - connecting with the AMBO
pipeline precisely at these same critical borders.

This system of pipelines is designed not only to transport petroleum to
seaports for shipping abroad, but extends into the heart of Europe. Two
branches of the AMBO line jut into Greece - one to Thessalonika, the other
to a terminal on the west coast.

All of this has to do

with the enor-

mously rich petroleum fields of the Caspian Sea basin. In order to get that
oil to market, one of the best routes is to pipe it to the Black Sea, ship
it in tankers across the sea and then pipe it again across the Balkans to
the Adriatic Sea. This bypasses the treacherously narrow Bosporous Straits
near Istanbul, which Turkey claims could not safely accommodate the heavy
tanker traffic from the Black Sea to the Mediterranean.

By restricting this route, Turkey is also limiting Russian oil transport
through the straits and boosting its own interest in the construction of a
pipeline from Baku on the Caspian Sea to the Turkish terminal at Ceyhan,
which would also by-pass Russia.

This route has fluctuating support by the United States. The AMBO
trans-Balkan pipeline will make all countries from the Caspian Sea to the
Balkans politically and economically dependent on the U.S.

The transport of oil through the Balkans is not the only consideration for
the giant oil cartels. They are also pursuing the development of rich
petroleum fields in various parts of the Balkan region itself, especially in
Albania.

The feasibility study giving the green light to the AMBO project was largely
paid for by U.S taxpayers. Was it mere coincidence that the terrorist
attacks in Macedonia began just after the successful completion of the study
and the go-ahead was given for the pipeline?

Journalist Richard Norton-Taylor, writing in The Guardian of London, put it
this way: "While the U.S. and NATO - and now the [European Union (E.U.)] -
hold out the prospect of untold wealth for the Caucasian states of the
former Soviet Union, the West will also have an important economic stake in
Albania and Macedonia ... The implications for Kosovo, a Serbian province
with an overwhelming ethnic Albanian population, and for Macedonia, with
armed groups from Kosovo stirring up trouble among the ethnic Albanian
population, are potentially immense."

General Michael Jackson, who eventually took over command of KFOR in Kosovo,
when speaking of Macedonia, said: "[W]e will certainly remain here a long
time so that we can also guarantee the security of the energy corridors
which traverse this country."

Somehow it comes as no surprise that the AMBO pipeline project is headed by
AMBO CEO E.L. "Ted" Ferguson, former director of oil and gas development for
Europe for Brown and Root, which is part of Halliburton, Vice President Dick
Cheney's old company.

Interestingly, the gargantuan Camp Bondsteel was also built by Halliburton.
It is the largest U.S. military base constructed since Vietnam. Furthermore,
the troops stationed in the Balkans are being serviced by Halliburton and
the feasibility study for the AMBO pipeline was conducted by Brown and Root.

There is a tremendous pot of "Black Gold" at the end of this pipeline
rainbow. The oil giants already moving into place to operate under the
umbrella of AMBO are Texaco, Chevron, Exxon, Mobil, BP, Amoco, Agip and
TotalElFina.

A project as massive as the trans-Balkan pipeline requires enormous amounts
of U.S. government money in the form of investment guarantees from the
Export-Import Bank, loans from the World Bank and other backing. It needs
the sword to march along with the dollar, even if that sword is wielded by
surrogate forces. It needs NATO troops and the massive U.S. "Fort" Bondsteel
in the "frontier" outpost of Kosovo, to protect the investments. Who better
to guarantee all of these things than the Bush administration team with its
connections to corporations like Halliburton, and big oil? They are dripping
in oil and energy profits.

The E.U., with Germany leading the way, has been projecting several
corridors since the early 1990s. These are not only energy corridors, but
also will provide a vast complex of communications - highways, railroads,
airports, maritime ports and rivers - critical to the economy and corporate
profits in Europe. The U.S. has balked at several of the pipeline and
corridor plans that would carry oil from the Caspian and Russia (including
through Ukraine) into Europe.

Another pipeline competing with the AMBO corridor is projected to carry
crude from Russia to Greece via Bulgaria. Hundreds of billions of Euros are
at stake. However, it appears that the AMBO pipeline, with its connection to
the corridor 10 pipeline, will give the U.S. control over a considerable
amount of the oil coming into Europe from the Caspian basin.

These plans have created one of a number of substantial rivalries between
the U.S. and the E.U. This competition has been reflected in recent years in
differences over Kosovo, Bosnia and Macedonia, among other disputes.

The goal of the ongoing terrorism, led by the KLA, has been, and now is
openly proclaimed to be, the establishment a "Greater Albania." The only
time such an entity ever existed was under the fascist rule during World War
II. This objective is being espoused by the neo-fascists of today. Is the
success of the AMBO pipeline project dependent on going along with this aim?

The map of "Greater Albania" includes parts of Greece. Is it mere
happenstance that the AMBO line includes branches into Greece and that the
Presevo Valley is the only possible route for a pipeline between Europe and
the Greek port of Thessalonika? (see map)

The agony of the people of Yugoslavia, who were steadily bombed by the U.S.
and NATO for 78 days and hard hit by the severest economic sanctions for
years, coupled with the fragmentation of the former Yugoslavia, must be
viewed against the backdrop of corporate profits, particularly oil profits.

Upon close examination, one discovers that the giant oil companies continue
to be deeply involved in most of the conflicts in the world, including in
efforts to destroy national sovereignty and break up nations. More often
than not, U.S. government and military policies back them up. In the case of
the southern Balkans, the intent may well be to establish a "Greater
Albania" to advance the interests of the oil conglomerates.




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In response to the so-called "energy crisis," Vice President Richard Cheney
brushed aside energy conservation and renewable energy and announced that
the Bush-Cheney administration favors a sharp increase in oil and gas
production as the answer.

Cheney is the ramrod for oil drilling in the fragile Arctic National
Wildlife Refuge. He favors opening federal lands and offshore sites for oil
exploration. Cheney also announced that the administration will push for the
construction of 1,300 new power plants by the year 2020, fired by fossil
fuels that will pump out millions of tons of greenhouse gases, adding to the
crisis of global warming.

In opting for an energy-intensive policy, Cheney rejected a report by
scientists at five national laboratories that a vigorous energy conservation
program could reduce electricity demand by as much as 47 percent. That is
the equivalent of the energy produced by between 265 and 610 big 300
megawatt power stations, depending on how effective people are in saving
energy.

Some of the conservation proposed by the Lawrence-Berkeley National
Laboratory were common sense measures like encouraging people to turn off
lights, installing heat pumps and converting to energy-efficient fluorescent
lamps. The U.S. government itself, with 500,000 buildings, is the biggest
energy consumer and could save $1 billion each year through adoption of
energy conservation measures.

President Bush and Cheney scorn these proposals because they are Texas oil
men ever loyal to their cronies in gas and oil business. Conservation would
do nothing to add to the bottom line of companies like Halliburton and Enron
that put them in the White House. It has taken less than five months for the
Bush administration to preside over gasoline prices at $3 per gallon and
home heating bills that have doubled and tripled. George W. Bush has earned
the chant heard at so many marches and rallies, "Hail to the Thief."


- Tim Wheeler