Transcaspian Gas Route Seen as Unrealistic

Discussions on a Transcaspian gas pipeline have resumed with a new sense of urgency this year, yet according to NBCentralAsia energy analysts, much of the talk is just hype as the project is not really feasible.



On October 9, Hugues Mingarelli, who heads the European Commission's directorate for Eastern Europe, Caucasus and Central Asia, told journalists in the Kazak capital Astana that the European Union would back plans to lay a pipeline under the Caspian Sea to take Kazak and Turkmen gas to Europe, via Azerbaijan and Turkey.



The Transcaspian proposal gained a new lease of life because of concerns raised by Russia’s gas dispute with Ukraine last winter, and has been discussed at the highest level. The United States supports the idea, and it was on the agenda during Kazak president Nursultan Nazarbaev’s visit to Washington on September 26-29.



However, NBCentralAsia’s energy analysts say it is too early to invest serious hopes in the scheme, because no new element with the potential to kick-start the project has appeared since it was first conceived back in the mid-Nineties. Instead, they predict that it will remain a political pipe-dream that faces too many obstacles to ever become a reality.



The problems include the technical difficulty of laying a pipeline under the sea, the environmental risk in an earthquake-prone region, the unresolved question of how the Caspian should be divided up among the littoral states, and the likelihood that two of these countries, Russia and Iran, will oppose the plan. Last but not least, there is the high cost of the project, currently estimated at five billion US dollars.



“Because the Caspian is an enclosed sea, it is a very vulnerable ecological system,” said one energy expert, Yaroslav Razumov. “Constructing and operating a pipeline at the bottom of the sea could be dangerous for the entire region’s ecosystem”.



Pumping gas all the way to Europe, traversing immense distances through several countries, will result in a substantial increase to the net price of the fuel. By 2010, Russian gas will be going to western Europe via a north European pipeline under the Baltic Sea, and will be much more keenly priced.



According to NBCentralAsia's experts, the Caspian countries involved in the project - Turkmenistan, Kazakstan and Azerbaijan – would have to bring foreign companies on board since they lack the capacity to handle a project of this technical complexity. However, this would meet with strong opposition from both Iran and Russia, which regard the Caspian region as vital to their own energy security and would not want outsiders involved.



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