The Central Eurasian Hydrocarbon Energy Complex: Evolution and Prospects
"From 1989-1994, Russia jockeyed with other regional actors and with the United States for a position in the South Caucasus," stated Robert Cutler, Senior Research Fellow, Institute of European, Russian, and Eurasian Studies, Carleton University, Canada. This continued from 1995 to 2000 as the scope of such competition extended to Central Asia. During this same period, China began to project its influence into Central Asia up to the Caspian Sea as the European Union remained skeptical of American involvement. Then, from 2001 to 2006, the EU's interest deepened sharply, particularly as Russia's energy disputes with Ukraine affected EU member states. By 2008, the South Caucasus and other East European countries had formed the collective intention to work with the EU to develop non-Russian oil and gas pipelines which would circumvent Russia. The major Central Asian producers of Kazakhstan and Turkmenistan also took steps in this direction and implemented practical measures for increased energy cooperation with China as well. At a recent Kennan Institute lecture on 18 May 2009 Cutler, analyzed these developments and projected their continuation into the future.
"From Russia's perspective," Cutler put forth, "the United States, China, and the EU encroach upon its former domain in Central Asia and the South Caucasus." China has established access to oil from eastern Kazakhstan and to gas from Turkmenistan. In the last few years, the EU has become very serious about finding non-Russian energy resources and routes. Since the beginning of the post-Soviet era, the United States has consistently promoted the search for energy resource routes that reach world markets by circumventing Russia, starting with oil in northwest Kazakhstan in the early 1990s. The experience of Azerbaijan, which has shown itself to be a reliable partner, has validated the advantage to countries in the region of developing on multiple export routes.
Vladimir Putin's focus on Central Asia has been qualitatively new in the post-Soviet period. Yeltsin's foreign minister Evgenii Primakov, Cutler explained, attended mainly to traditional Soviet allies such as Iran, India, and China. "An ‘Eurasianist' strand did not enter post-Soviet Russian foreign policy until the mid-1990s," Cutler said. He attributed Russia's growing focus on Central Asia to the necessary consolidation that would inevitably follow the post-Soviet disorder in the region and to U.S. and European involvement in the South Caucasus.
In recent years, it has been the EU, not the United States, acting in its own interest which has provided the greatest assistance to countries seeking to orient their export policies in a non-Russian direction. This is due in significant part to Russia's miscalculations over how its energy disputes with Ukraine, Belarus, and other countries would be interpreted in Europe. The notion that Russia used energy as a weapon made an indelible impression on both mass and elite opinion.
"The on-course westward extension of China's current oil pipeline from Kazakhstan is an especially impressive piece of political-economic engineering," stated Cutler. Chinese geo-economic energy penetration into Central Eurasia is confirmed not only with the entry into service of the oil pipeline from Kazakhstan but also with the construction now under way of the gas pipeline from Turkmenistan, through Uzbekistan and Kazakhstan, to Xinjiang in western China. Cutler believes that both Tengiz and eventually Kashagan oil could conceivably reach China. The result could eventually boost Chinese imports of Kazakh oil from 100,000 to 400,000 bpd. Whether that happens, or how fast, depends crucially on the accessibility of oil from Kashagan. "Kazakhstan's decision in favor of the Kazakhstan Caspian Transportation System (KCTS) and its westward route for Kashagan, however, suggests that the Kazakh leadership may not be too keen to repeat with China its mistake of depending too much on Russia."
Written by Sarah Dixon Klump
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