Kazaks Discuss Caucasus Energy Corridor

As Kazakstan reviews proposals to become involved in two oil and gas export projects giving access to European energy markets through the Caucasus and Turkey, analysts say a plan to transport oil by rail and sea is the less risky of the two from a political perspective.



During a visit to Astana in late February, Azerbaijani foreign minister Elmar Mamedyarov invited Kazakstan to participate in building a railway from Baku via Tbilisi and Akhalkalaki in Georgia to the Turkish city of Kars, allowing oil to be shipped across the Caspian and on to European markets. They also discussed possible Kazak involvement in the Baku-Tbilisi-Erzerum gas pipeline, which was launched in February.



Georgian president Mikheil Saakashvili discussed both matters with President Nursultan Nazarbaev when they met on March 5.



Kazakstan-based analysts say the railway project is the more realistic and potentially profitable prospect for their country, given that shipping already plies the route from the Kazak port of Aktau to Baku across the Caspian, so the infrastructure is already partly in place.



“This route… would allow Kazakstan to supply [Turkey] with oil,” said analyst Vasily Lukyanchikov. “Kazakstan has already announced it wants to build a refinery in Turkey, and would supply the crude oil.”



Russia and China could also invest in the project, making it more commercially viable.



Analysts are more sceptical about what Kazakstan stands to gain from joining the gas pipeline project. One way of getting Kazak gas to Baku would be via the undersea Transcaspian Gas Pipeline, but this project is still only at the discussion stage and may well be opposed by Russia.



“Kazakstan is not a leading producer of gas in Central Asia,” said political scientist Nikolai Kuzmin. “It does not sell large volumes [abroad], and all of it goes through Russia. A project to take Kazak gas to Europe via Turkey is not going to be relevant.”



Participating in a project to supply gas to Europe without going through Russia would be politically risky, and laying a pipeline on the Caspian seabed would be complicated.



“This project has a clear anti-Russian colouring to it,” said Kuzmin. “It’s less about what makes sound economic sense than about political horse-trading, and Kazakstan has no direct interest in this.”



(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)