Analysis: Forum in Iran to discuss energy
Washington (UPI) Mar 4, 2009 The Tehran meetings of the Economic Cooperation Organization represent a critical mass of decision makers, and as the development of the region's energy potential tops the meetings' agendas, the discussion on the Caspian seabed undoubtedly will be, to use diplomatic parlance, "frank and candid." Summit organizers nonetheless already are informing the media that the ECO sessions are expected to conclude by passing a "Tehran Declaration" delineating the progress achieved by the organization in various areas and enumerating potential future projects. Whether the Tehran Declaration will embody some genuine accomplishments or represent simply another photo-op at this point remains to be seen. The ECO was founded in 1985 by Iran, Pakistan and Turkey to promote economic, technical and cultural cooperation. Since then the ECO has grown to 10 members, as Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan joined the organization in 1992. The ECO is notable for the fact that all its member states are Muslim nations. The states range from major energy exporters Azerbaijan, Iran and Kazakhstan through the rising natural gas states of Turkmenistan and Uzbekistan to the consumer states of Afghanistan, Kyrgyzstan, Pakistan, Tajikistan and Turkey. Religious solidarity aside, the economic disparity between the energy "haves" and "have nots" ranges from Kazakhstan and Azerbaijan, whose economies have flourished on a rising tide of petrodollars, to Afghanistan, still enmeshed in civil war after 30 years of conflict. Significant tensions exist beneath the veneer of cordiality, including rising energy rates from the former Soviet republics causing friction with their neighbors, varying approaches on foreign investment, and squabbles over transit routes and rights between producers and consumers. The global economic recession has affected all industries, including energy. Western hopes remain high, however, for staying a major player in the Caspian basin, the most intensively developed hydrocarbon region since the 1991 collapse of the Soviet Union, which unexpectedly opened the area to foreign development. The implosion of the Soviet Union in opening up the Caspian led U.S. Vice President Dick Cheney to remark in 1998, "I can't think of a time when we've had a region emerge as suddenly to become as strategically significant as the Caspian." But if the Soviet Union's demise offered possibilities to Western energy firms, it multiplied the political complexities, as in place of the Soviet Union, Iran acquired as shoreline neighbors the new nations of Turkmenistan, Azerbaijan, Kazakhstan and Turkmenistan, all squabbling over a major issue that has remained unresolved for 18 years -- the equitable division of the Caspian seabed and its attendant riches into mutually recognized national sectors. Accordingly, the world's energy companies will be focused on an upcoming series of meetings of ECO in Tehran. The proceedings start with the March 7-8 gathering of ECO senior officials, followed by a gathering of the ECO Council of Foreign Ministers on March 9, culminating in a March 11 summit attended by all the presidents of ECO member states. One Caspian coastal state is noticeably absent -- Russia. As Russia is currently the sole transit route for Turkmen and Uzbek natural gas, as well as the bulk of Kazakh oil exports, Moscow's absence at the discussions leaves significant areas of discussion offline. The biggest issue at the heart of further untrammeled development of the Caspian's energy riches is the conclusion of a definitive agreement about the Caspian seabed to replace the 1921 Iran-Soviet Treaty of Friendship and the 1940 Convention on Commerce and Navigation agreements that the Soviet Union concluded with Iran, the only bilateral state conventions that specifically delineated the Caspian's waters between the two states. The lack of a definitive treaty signed by all five Caspian nations stymies offshore mid-Caspian development and thwarts the construction of various proposed undersea pipelines. Since 1991 the five coastal states have all operated on an ad hoc basis on developing their close inshore waters, most notably Azerbaijan and Kazakhstan in their respective spheres, but the lack of a treaty clearly delineating seabed sovereignty has precluded up to now a number of proposed projects that remain on the drawing board, including a proposed subsea Turkmenbashi-Baku Trans-Caspian natural gas pipeline and various Kazakh-Iranian schemes. As Cheney observed, the region's potential is immense. According to the U.S. government's Energy Information Administration, the Caspian's 143,244 square miles and attendant coastline could contain as much as 250 billion barrels of recoverable oil and more than 200 billion barrels of potential reserves, quite aside from up to 9.2 trillion cubic meters of recoverable natural gas; even with oil at $40 a barrel, the region's recoverable oil alone is worth $10 trillion. The differing opinions crystallized around Russian assertions that a final division of the Caspian's seabed should be based on a country's shoreline, while Iran has consistently maintained since 1991 that all five nations should equitably receive a 20 percent share of the Caspian's resources, which is significantly more than its sector of 12 percent to 14 percent under the Russian formula. Kazakhstan and Azerbaijan support the Kremlin's position. While Turkmenistan's position under its late President Saparmurat Niyazov wavered between Tehran and Moscow, his successor, Gurbanguly Berdimuhamedov, is increasingly tilting toward the Russian position, which means that all four former Soviet republics' policies on the issue are largely in sync, giving the appearance of solidarity on the issue in Tehran and lessening the importance of Russia attending the meetings. In the absence of agreement, the possibility for armed clashes exists. On July 23, 2001, an Iranian warship and two fighters forced a BP-Amoco research vessel chartered by the State Oil Co. of the Azerbaijani Republic to cease prospecting in Azerbaijan's offshore Caspian Araz-Alov-Sharg field, a confrontation that Baku claimed occurred 60 miles north of Iranian waters. Further to the west, last August's brief military confrontation between Georgia and Russia highlighted the risks of associating one's energy development too closely with Western powers, leading both Kazakhstan and Azerbaijan to engage in oil swaps with Iran to get their product to global markets, Azerbaijan for the first time. Both incidents point to the value of resolving disputes internally rather than seeking outside funding and influence. Besides facing a united front from its northern Caspian neighbors, what may pressure Iran to resolve the issue is the presence of fellow energy-poor ECO colleagues Afghanistan, Pakistan, Kyrgyzstan, Tajikistan and Turkey, fully half the ECO membership, and their potential willingness to support Iran in return for increased energy flows that a resolution of Caspian territorial issues would produce. As Iran looks for international support for its civilian nuclear program, climbing down on the Caspian division issue undoubtedly would garner it support from its ECO colleagues, while Russia, assuming that its position prevailed, would be in Tehran's debt as well. Such possibilities make the upcoming ECO summit of more than passing interest, as it is in all the member states' interest for the gas and oil to flow. Only time will tell if the global recession, a new American administration and rising international concern over Iran's nuclear program lead to breakthroughs or if the session remains, like so many earlier Caspian energy gatherings, yet another opportunity for a group photograph. Share This Article With Planet Earth
Related Links Powering The World in the 21st Century at Energy-Daily.com
Analysis: Mexico offers new oil fields Miami (UPI) Mar 4, 2009 Mexico has allocated more than 170 new sites for petroleum development amid falling production in its traditionally bountiful Cantarell oil field, where officials have revised production estimates for the year to reflect the forecast for further decreasing output. |
|
The content herein, unless otherwise known to be public domain, are Copyright 1995-2007 - SpaceDaily.AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement |