Comments on: Win-win-lose?

By: Jean

Jean — Fri, 02 Nov 2007 18:05:35 +0000

Ruminator is exaggerating the risk from earthquakes. Modern technology makes this risk manageable. Example: Alyeska pipeline in Alaska was designed to withstand tremors of up to 8.5 on the Richter scale. In 2002, the pipeline withstood a 7.9 quake which was the largest on the Denali Fault since at least 1912 and among the strongest earthquakes recorded in North America in the last 100 years.
The 1948 Ashkabad earthquake was of 7.3 magnitude. According to scientists at Schmidt Institute of Physics of the Earth, Russian Academy of Sciences, earthquakes of that magnitude are likely to happen once in 900-1,000 years.

Links:
Alyeska pipeline earthquake protection, http://www.alyeska-pipe.com/Pipelinefacts/EarthquakeProtection.html
Seismogenic Zones of the Trans-Caspian Region: Characteristics of Sources of the Largest Earthquakes by Schmidt Institute of Physics of the Earth, Russian Academy of Sciences, http://www.maik.ru/cgi-bin/search.pl?type=abstract&name=physeth&number=10&year=5&page=775

Ruminator says “vastly under-priced C.Asian gas is increasingly not the case.” So? Why should C.Asian energy producers be at the mercy of Russia’s decision on when their gas exports will get fair pricing? Especially, given that this past summer EU has expressed willingness to pay world market prices at Turkmenistan’s border once the Trans-Caspian Pipeline is built?

If Russia is so concerned about environment, then, perhaps, Moscow could do something about Sakhalin II project which “has been met with heavy criticism over the potential environmental impact, which could include driving the world’s last 100 remaining Western Pacific gray whales to extinction.”
Link: http://en.wikipedia.org/wiki/Sakhalin-II

Every energy-producing nation has the right to build export routes in whatever direction they wish. Incidentally, that’s what Russia is doing. In the case of the Trans-Caspian pipeline, the interests of C.Asian states happen to coincide with those of the EU and the US. But that is not a crime and the coincidence doesn’t make the project a hostile act directed at Russia.

By: The Ruminator

The Ruminator — Fri, 02 Nov 2007 08:58:59 +0000

Also this is fairly illumination on Trans-Caspian

http://www.rzd-partner.com/news/2007/10/29/313784.html

By: Beyond the River » Blog Archive » Terror Plots for Fun and Profit

Beyond the River » Blog Archive » Terror Plots for Fun and Profit — Fri, 02 Nov 2007 00:40:34 +0000

[…] indeed, Craig Murray makes the Nordstream connection, which our fellow bloggers have been going on about recently. None of this is hard evidence that Uzbekistan might directly […]

By: The Ruminator

The Ruminator — Thu, 01 Nov 2007 16:30:09 +0000

Some thoughts on this debate:

1. Vastly under-priced Central Asian Gas: Increasingly not the case. Turkmenistan under its newly-enlightened leadership is asking for $140/mcm at the Russian border for onward delivery to Ukraine (ignoring the fact that gas is fungible) is greater than or equal to netback parity for Gazprom’s western sales. At $275/mcm (next years expected price to Europe) the equivalent price in European Russia is ~$135/mcm.
Because spot and long-term gas prices are all over the place due to the non-existence of winter last year not everything price wise is crystal clear but that its a good approximation.

2. Impact of Nordstream / Trans-Caspian. These are not just two sub-oceanic pipelines. Given that this was written by Central Asian specialists - you may have noticed the destruction caused by the fact that the Turkmenistan equivalent of the San Andreas fault runs through the caspian and close to Ashgabat. This makes sub-sea/lake pipelines very dangerous indeed. Logically gas should flow N through Russia or S through Iran - it does not it flows W through the Freedom Corridor (yes coined by a US Ambassador).

And the good news for Central Asian gas regarding Nordstream; there is already a deficit of gas in Russia because GAZP makes way more selling it to Europe than internally. Electricity demand is growing at 3-4% p.a. (as a proxy for gas demand). Nordstream and Shtockman have to be paid for. Long term contracts with Europe are the principal funding conduit.

Thus demand in Russia will be met by non-Gazprom producers and C. Asian gas. As Turkmenistan increases its sales options then Russia will be forced to pay market prices for C. Asian gas to compete. Good news for C. Asia.

The battle being fought right now in Turkmenistan to “control” Turkmen gas between China/Russia/US/EU (the latter 2 ought to be one but they are not) is both fascinating and very dangerous - not a great game any longer.

By: Abdulgamid

Abdulgamid — Thu, 01 Nov 2007 09:39:21 +0000

“Russia’s inevitable re-emergence as geopolitical power has unsettled the West because we wanted a client state led by a Boris Yeltsin-like political class. Western leaders branded Russian behaviour as unacceptable when Moscow interrupted natural-gas supplies to Ukraine. The only acceptable behaviour, apparently, was that the Russian taxpayer should have continued to subsidize Ukraine’s natural-gas consumers.”
Newsweek October 22 2007

Quotation from Economist on this entire issue would be more respectable but I didn’t find any

By: Andrew Yim

Andrew Yim — Wed, 31 Oct 2007 23:54:38 +0000

Just one point on Peter’s response.

A critical difference between US oil and gas interests and Russian interests is the extent to which private and public agents act in concert. Western policy makers can formulate all the policy they want, but in the end it is the companies themselves that must make the contracts and extract the resources.

In the former Soviet States, and to an extent China as well, the degree of confluence between the state and the oil/gas industry is much closer and even supervised.

And, so, efforts to link “western-centric” values of democracy and human rights (and one could argue that, in this day and age, it is difficult to claim those as distinctly “western” values) have only so much traction. While Russian efforts to link their oil and gas industry with any larger geo-political agenda are more viable and, in the end, effective.

By: turkmenistan.neweurasia.net » Russia, Europe, Turkmenistan - whose interests value the most?

Wed, 31 Oct 2007 10:59:22 +0000

[…] comments Ben’s post on neweurasia.net Homebase and highlights real economic and political roots of “The Great Battle […]

By: Siberian Light

Siberian Light — Tue, 30 Oct 2007 22:43:58 +0000

Russia, the EU, pipelines and Central Asia…

Two blogs about Central Asia, writing about Russia’s energy relations with the European Union. Yes, there is a reason behind their madness.
First up is Josh over at Registan, quickly followed by Ben at NewEurasia.
……

By: Peter

Peter — Tue, 30 Oct 2007 21:59:36 +0000

Russophobic and Western-centric logic invariably skews analysis of this entire issue.
The grotesque caricature of Russia’s energy resource export policy exemplified by Josh’s post at Registan is typical. He maintains, with little by way of actual evidence, that Moscow is interested exclusively in wielding its gas reserves for geopolitical advantage. Nord Stream, as Josh sees it, is a self-evident exercise in loss-making to the end of subjugating former Soviet satellite states. He tries to justify the argument with the unsubstantiated claim that Russia intends to sell its gas to Germany at a discount.
The analysis is woefully hindered by recognition of facts. If Russia were not our geopolitical antagonist, we would not bat an eyelid at the Nord Stream project. The pipeline would assures guaranteed supplies to Western European markets at regular prices, while giving Moscow the knowledge it did not have to rely on potentially antagonist. Nothing would stop Poland or Ukraine entering into direct negotiations with Gazprom, or German gas trading companies for that matter, but they would have to do so in the knowledge that they were operating on a truly open and competitive market. Was that not what Warsaw and all the Baltic States were seeking when they sought accession to the European Union and the community of Western economies, after all?
It would be naïve to suppose that there is not a dimension of geopolitics to Russia’s energy strategy, but the fact remains that they are entitled to do with their resources as they wish provided they do use them to breach the sovereignty of foreign states. So long as this remains the case (and developments in Russia’s interest in the energy infrastructure of neighbours Belarus and Ukraine are not encouraging this respect), there is no case to be made. Nord Stream undermines blackmailing strategies, not to speak of outright theft, on the part of transit states, which should only come as a relief to gas-hungry Western European states.
Where the arguments against Nord Stream are anti-competitive at best, and hypocritical at worst, prevailing attitudes to Central Asian gas resources are just plain dishonest. In the clamour for urging Turkmenistan and Kazakhstan to embrace the costly and technically problematic solution of a Trans-Caspian pipeline, there is absolutely no recognition that this strategy is essentially no different from Nord Stream. It is expensive and will result in worthwhile returns only over decades, unless Western states are actually willing to financially underwrite the entire exercise that is. While the mythical transit is being created, long-standing difficulties will arise in negotiating reliable gas supply contracts with Russia, not to speak of end-users in Eastern Europe such as Ukraine. The situation is not a dilemma, as some want to see it, but a technical and commercial nightmare.
Western-centric observers make facile associations between democracy, sovereignty and energy-wealth, but Central Asian states inevitably see matters in much more sanguine terms. If Turkmenistan could sell every last bit of its gas to the Chinese at competitive rates, they would do so without the slightest bit of compunction. China has vastly more to offer in real economic terms to offer Central Asia than the United States and Europe.
The brutish truth is that Western policymakers are far more interested in undermining the interests of their global antagonists than the genuine well-being of former Soviet states. These are the real terms of any discussion of energy reserves, not the glib and sweeping statements about democratic values and civil liberties.
What the West, or serious-minded citizens, should be truly be concerned be occupied with is constructing an ethical and consistent policy of engagement with Central Asia and the surrounding region. That would involve subordinating economical self-interest to genuine stability and sustainable development, which would be virtually unprecedented in the recent history of the Western world.