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Two
News Reports on Supposed Oil Pipeline
These
Are Supporting Documents for the Article “The
Great Afghan Oil Pipeline Disaster,”
at
http://emperor.vwh.net/articles/jared/relief.htm
[Posted 6 March 2003]
========================
A)
Australian Financial Review:
"Pipeline Plan Another Casualty"
B)
World Gas Intelligence:
"Gazprom Plans New Turkmenistan Pipe"
========================================================
[ www.tenc.net ]
========================================================
A) "Pipeline Plan Another Casualty"
By Nick Hordern
Australian Financial Review; February
28, 2003 Friday; SECTION: News; International News; Pg. 28; LENGTH: 590
words; Copyright 2003 John Fairfax Publications Pty Ltd
* Posted for educational use only
========================================================
The death of Juma Mohammad Mohammadi,
Afghanistan's Minister for Mines and Industries, in a plane crash on
Tuesday cast a pall of gloom over TAP, the proposal for a gas pipeline
from Turkmenistan through Afghanistan to Pakistan.
The light plane carrying Mohammadi and four Afghan officials crashed as it
flew from Pakistan's port city of Karachi to south-western Baluchistan
province, where he was to inspect mining projects.
Mohammadi's death was one more bad augury for TAP.
He had been in Pakistan for last weekend's meeting between the three
countries in Islamabad.
After the meeting, the three invited India to participate in the $US3.2
billion ($5.3 billion) project as a customer for Turkmen gas.
"Since the viability of the project depends upon the extension of the
pipeline to India, it was agreed to formally forward the documents of the
TAP to the government of India, inviting them to join the project," a
joint communique said.
On the face of it, Indian involvement in TAP makes sense for all four
countries.
Although it has the world's fourth-largest gas reserves, Turkmenistan is
dependent on customers in the former Soviet Union and is seeking other
markets.
After 24 years of war, Afghanistan's economy is in ruins and Kabul is in
dire need of the sort of revenue TAP would generate.
Pakistan has no urgent need to import gas, but its own reserves will not
last for ever.
And Islamabad is keen to build economic links with Afghanistan and the 'Stans
the five former Soviet Muslim republics of Central Asia.
India's demand for gas is expanding at 6 per cent a year and cannot be
supplied from domestic reserves. India suffers from horrific pollution, so
has an environmental imperative: gas is a cleaner fuel than the coal that
provides the bulk of India's power.
Despite these common interests, TAP is unlikely to proceed because India
will not countenance the use of energy piped across the territory of
arch-enemy Pakistan.
Twice in the past 15 months, Delhi and Islamabad have been on the brink of
war over the disputed Himalayan territory of Kashmir.
The problem is not that India is opposed to closer economic ties with
Afghanistan and the other states of Central Asia.
Tomorrow, for example, Afghan President Hamid Karzai is due in New Delhi
to sign an agreement with India that will slash tariffs in bilateral
trade.
And Delhi is urging Tehran to improve road links between Central Asia and
the Iranian port of Chah Bahr, to boost seaborne trade with India and so
avoid Pakistan.
But the likelihood that Delhi will reject TAP can be inferred from its
plans to buy Iranian gas.
India has been considering a pipeline from Iran's South Pars gas field
since 1994.
The two countries signed a memorandum of understanding on the purchase of
gas during last month's visit to Delhi by Iran's President Mohammad
Khatami.
"In view of huge reserves of energy in Iran and [the] increasing
requirement of India [for] energy, the two nations are natural
partners," Indian Prime Minister Atal Behari Vajpayee said at the
time.
But India will not take the simple option of piping Pars gas across
Pakistan.
"We have not spoken to Pakistan on this and we are not going to talk
to them," India's Petroleum Minister, Ram Naik, said last week.
Instead, India intends to pursue the more expensive and technically
challenging option of an undersea pipeline.
This is a striking demonstration of the cost of the Kashmir dispute not
just to India and Pakistan but to other countries in the region.
***
========================================================
B) Gazprom Plans New
Turkmenistan Pipe
World Gas Intelligence; February 28,
2003; SECTION: WHAT'S NEW
LENGTH: 627 words; Copyright 2003 Energy Intelligence Group, Inc.
========================================================
As part of a campaign to pull Turkmen
gas back into the supply-short Russian system after years of excluding the
Central Asian producer, Gazprom is trumpeting a plan to build a new 700
kilometer, 30 billion-40 billon cubic meter per year pipeline to carry the
volumes that the Russian gas company aims to purchase from Turkmenistan
beginning in 2007.
This would provide an alternative to the proposed but problem-ridden
scheme to build a 1,400 km gas pipeline from Turkmenistan through
Afghanistan to Pakistan and perhaps on to India (WGI Jan.8,p5).
The Gazprom-proposed line would run from the gas fields to Turkmenistan's
border with Kazakhstan, bypassing Uzbekistan, and then on to the
Kazakh-Russian border -- potentially providing another outlet for Kazakh
gas on top of the planned Shah Deniz pipeline to Turkey (p1).
Although the system would cost each partner an estimated $1 billion even
if it is split 50-50, Turkmenistan would prefer to build the stretch to
the Kazakh border without Gazprom's assistance, in order to keep full
control over the transport infrastructure on its territory. Gazprom says
that it is ready to help in building the entire line, but given the
Turkmen position, its participation would probably be limited to the
segment running from Kazakhstan to the Russian border. Before the pipeline
can progress, however, Gazprom and Turkmenistan must firm up an
intergovernmental agreement initialed by Moscow with Turkmenistan last
September, which calls for the delivery of 10 Bcm/yr (967 million cubic
feet per day) of Turkmen gas to Russia beginning in 2005, with volumes
rising to 20 Bcm/yr in 2008-20 (WGI Dec.4,p4).
Turkmenneftegas and Gazprom were expected to sign a 15-year contract by
the end of 2002, but have yet to do so. Gazprom officials now say that a
final agreement on this and the pipeline is expected in the first half of
this year, allowing for completion of the pipeline by 2007.
Currently, Gazprom is in intensive dialogue with Ashkhabad, arguing that
the new gas pipeline would allow Turkmenistan to increase its gas
shipments to Europe. The Russian company says that, in return, it wants
guarantees on gas volumes that Turkmenistan would be able to pump via
Russia's territory. This would allow Gazprom to benefit from gas
transportation tariffs, as well as to fulfill its export and domestic gas
contracts, possibly under some arrangement similar to that by which
Gazprom handles sales of Kazak gas on the UK and continental North
European spot markets (WGI Feb.26,p6).
A deal with Turkmenistan would also allow Gazprom to cut gas production
costs, since Turkmenistan offers more favorable tax terms than Russia.
Separately, Gazprom plans to increase shipments to a growing market in
southern Europe and is pressing ahead with expansion of its presence in
Bulgaria, a strategically important transit hub. Following a preliminary
accord in February, Gazprom Chief Executive Alexei Miller and Bulgarian
Minister of Energy and Energy Resources Milko Kovachev on Mar. 2 signed a
memorandum on expanding Bulgarian-Russian cooperation in gas supplies and
transit, during a visit to Sofia by Russian President Vladimir Putin.
The parties agreed to extend for another 10-15 years the contract on gas
transportation via Bulgaria to Turkey and Southern Europe, as well as to
improve the terms and conditions. Putin says that Russia is ready to
increase its gas shipments to the Balkans to 18 Bcm/yr from 12 Bcm/yr
currently.
The parties also agreed to prepare proposals for expanding gas
transportation facilities inside Bulgaria and building new ones by the end
of 2003. Gazprom is expected to invest $50 million in the effort, with the
Russian government providing another $150 million.
***
========================================================
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