The European Union announced on its website europa.eu on September 12 that it had adopted a mandate to negotiate a legally-binding tripartite treaty among the EU, Azerbaijan and Turkmenistan to build the Trans Caspian Pipeline System -- the first EU treaty of its kind to support an infrastructure project. The decision was a direct follow-up to visits by President José Manuel Barroso and Energy Commissioner Günther Oettinger to Baku and Ashgabat in January 2011, and involves acceptance by all 27 members states of the EU that the European Commission will lead the negotiations.
Of course, the EU getting its own act together doesn't mean that Ashgabat is yet ready to make a deal -- those countries that have successfully negotiated pipeline deals with Turkmenistan, notably China as well as the other nations in the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, have come prepared to invest financial and political capital in Turkmenistan. The EU's own commitments and capacity aren't exactly yet clear yet.
While there is now an EU mandate backed by 27 countries, certain strains within the EU alliance regarding Central Asia and the Caucasus won't necessarily disappear overnight. Some EU members have a presence in Turkmenistan’s gas fields already, and others have projects that appear either to conflict with Nabucco or at least run parallel to it in ways that might sap resources needed for its ever-growing cost, now estimated at $19 billion, UPI reports.
Italy's Eni, a multinational oil company and Italy's largest industrial company, has had a strategic partnership since 2006 with Russia’s state-owned monopoly Gazprom. In 2007, Eni signed an agreement with Gazprom to develop the South Stream pipeline which is generally viewed as a competitor to Nabucco. and diverts some energy for Ukraine. Recently, Eni sold half of its 33.3% stake in Libya's El Feel (Elephant) oil field to Russia's Gazprom, Reuters reported. This month Gazprom and its partners in the South Stream pipeline signed an agreement parceling out its offshore section; 50 percent for Gazprom, 20 percent for Eni and 15 percent each to France's energy company EDF and Germany's Wintershall.
The French EDF entered into a trilateral memorandum of understanding in June 2010 to join South Stream as shareholders through a reduction of Eni's share in the joint project, where Eni agreed to keep at least 10 percent in shares. gazprom.com reported. Last year, former Italian prime minister Romano Prodi turned down the offer to head South Stream, but Marcel Kramer of the Netherlands, chairman of the Dutch Gasunie and a former NATO official, accepted the position. Bulgaria and Hungary are also involved in South Stream.
South Stream is planned to run from Russia’s port of Novorossiysk to Bulgarian port of Varna where it would split into two branches for South and Central Europe. Just as Nabucco is designed to end dependency on Russian routes, so South Stream is ultimately about reducing dependency on Ukrainian and Turkish suppliers and could become even more expensive, currently estimated between $25 to $35.5 billion.
In January of this year, US diplomats went so far as to discuss the prospect of having Nabucco and South Stream merge or at least coordinate. Yet Italian Industry Minister Paolo Romani said South Stream and, Interconnection Turkey-Greece-Italy (ITGI) are incompatible with Nabucco, given European financing, Bloomberg News reported.
“Sooner or later Europe will have to face the problem either by making a choice or by making the three gas pipelines compatible,” Romani said at the time. “We need more clarity on the strategy of the European Commission and in particular of Commissioner Guenther Oettinger." he added.
Now, with the mandate of 27 countries, Oettinger has sought to bring that clarity, calling South Stream an attempt by Russia to hamper the realization of the alternative Nabucco gas pipeline, actively supported by Europe," news.am reported, citing BBC's Russian Service reported.
The Nabucco consortium members in Nabucco are Germany's RWE, Hungary's Mol, Bulgaria's Bulgargaz, Romania's Transgaz SA and Turkey's Botas.
While in the spring of this year, Russia initially failed to gain permission from Turkey to build South Stream along the Black Sea bed, by August it had clinched the deal with Ankara, and Gazprom can now proceed with construction, euronews.net reported. Eni remains a leading partner in this project conflicting with Nabucco, although Turkey's Prime Minister Tayyip Erdogan tried to spin the issue as claiming "it would be more correct to describe Nabucco and South Stream as parallel rather than alternatives to each other."
In a move that essentially called out the political nature of Russia's goals with South Stream to bypass Ukraine, Ukrainian President Viktor Yanukovych suggested this month at the Yalta European Strategy 8th Annual Meeting that costs could be reduced for the more expensive Turkish route by building South Stream on dry land in southern Ukraine instead.
Ukraine has also made a major push to position itself to purchase Turkmen gas. After some diplomatic shuttling this summer, President Yanukovych visited Ashgabat to make various trade and cultural agreements with Turkmen President Gurbanguly Berdymukhamedov. Ukraine faces competition for Turkmen gas with China, Iran, the US and others, and there is currently no way to deliver the gas except via pipelines across Russia
Yet according to an unidentified source in the Ukrainian delegation cited in a September 13 report from the opposition web site gundogar.org, Turkmenistan is prepared to sell Ukraine its gas for $200 per thousand cubic meters (tcm) -- $5 less per tcm than it agreed to charge China three years ago. According to gundogar.org's source, Ashgabat is ready to give Kyiv other breaks "including having Ukraine drill for gas itself on the Turkmen [Caspian] shelf." Ukraine is already being offered up to 5 billion cubic meters, said the source.
All told, until construction has actually begun and Ashgabat formally agrees to pump gas westward, the various pipeline projects remain political tokens, as the various great and small powers jockey for an advantageous position.
Five years have passed since the death in prison of journalist and human rights activist Ogulsapar Muradova, the Kazakh Service of Radio Liberty/Radio Free Europe reminds us. Yet the Turkmen authorities continue to refuse to permit an independent investigation into the circumstances of her death. Muradova was a correspondent for the Turkmen Service of RFE/RL. She and two other Turkmen reporters and human rights activists who remain in prison -- Annakurban Amanklychev and Sapardurdy Hajiev-- helped a French film crew to make a documentary about life under past dictator Saparmurat Niyazov, were accused of “espionage” and sentenced to long terms. Then on September 14, 2006, Turkmen security agents informed her children of her death in prison. Human rights groups continue to demand an independent inquiry due to signs of torture on her body.
Dunja Mijatović, the Representative on Freedom of the Media for the Organization for Security and Cooperation in Europe (OSCE), made her first visit to Ashgabat this month, offering assistance in liberalizing media legislation and calling for greater Internet access. She was expected to privately raise the cases of imprisoned journalists, but publicly, however, her strategy was to engage the Turkmen leadership by taking seriously their proclamations of intentions to reform their media. OSCE is organizing media training for senior officials and discussions on reform of the media law – exercises that are unlikely actually to liberate the
Catherine A. Fitzpatrick compiles the Turkmenistan weekly roundup for EurasiaNet. She is also editor of EurasiaNet's Sifting the Karakum blog. To subscribe to the weekly email with a digest of international and regional press, write [email protected]
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