Source: Foreign Affairs
There is no better symbol of competition and interdependency than the Caspian Sea, which connects Central Asia and Europe, and Russia to Iran and the Middle East. This inland sea, both a bridge and barrier, contains some of the world’s largest fossil energy reserves, yet the undefined rules of the political game have kept them off limits: the Caspian energy resources are of great interest to Europe, China, and Russia, but the question of how to carry them to their destination or perhaps to the open ocean remains exceedingly complex.
Last spring, I paid a visit to the Caspian Sea to get a sense of the changes taking place there as different projects to connect Europe and Asia picked up speed. Since no passenger boats sail the Caspian, the only way to cross it is by cargo ship. Most will take a handful of passengers to make some extra money, but there are no fixed schedules. You have to wait for a ship to be fully loaded with goods before getting on board. Since there was no timetable, a helpful Russian woman named Vika who worked for the Azerbaijan State Caspian Shipping Company gave me her number. But as I called every two hours, the answer was always the same: no ships today, probably not tomorrow either, and if there are any ships they will be carrying oil, so no passengers are allowed. Turkmenistan also has one cargo ship, the Berkarar, which I am told is more modern and has notably better conveniences for passengers, but no one knows where it is or when it leaves and the company has no offices in Baku.
After a couple of days, I started to wonder if I would ever make the crossing. Then I received a message from Vika: a load of cargo had just been delivered, so a ship would be leaving in two or three hours. I rushed to the Baku port where the tickets were sold, but it turned out that the ship was leaving from Alat, an hour’s drive south. Fortunately, the other passengers purchasing tickets at Baku port gave me a ride in their car. They were young Turkmen, in their early 20s, who had been working in the Azerbaijan oil industry, but were now returning home. They made sure to stop at a supermarket to stock up on alcohol. Anticipating a hearty meal later that evening with the ship crew, I picked up only a bag of raisins.
After a brisk passage through immigration, we retreated to our cabins, which were equipped with only a bunk bed and an old mattress. There were no blankets or pillows. The temperature would quickly fall below zero, and there was no heating on the ship. This would turn out to be a long, sleepless night. The crew was nowhere to be seen, so the idea of a warm meal cruelly dissipated as well. Shortly before sunset, the ship started to rock. That is how I knew we had left the port.
One or two hours after departing from Alat, the lights from Neft Dashlari appeared to our north. This offshore settlement holds hundreds of miles of roads, built on piles of landfill, that connect different oil rigs, most still in use even if the technology is nearly archaic. Nicknamed Stalin’s Atlantis, some of it lies in ruins. But the apartment buildings, partially submerged under water, still host thousands of oil workers. There are also functioning schools, cinemas, hotels, and a tree-lined park. Neft Dashlari was the world’s first offshore oil platform and its central settlement was built upon a foundation made up of seven sunken ships, including the world’s first oil tanker, the Zoroaster, which sailed from Baku in 1878.
As Neft Dashlari disappeared behind us, new lights from newer platforms, beacons of Azerbaijan’s oil empire, shone around us: Chirag, East Azeri, Deepwater Guneshli, and Shah Deniz. There are plans for the straight line that we were taking from Baku to Turkmenbashi to become an energy route, bringing natural gas from Central Asia to Europe. The proposed Trans-Caspian gas pipeline was first suggested exactly 20 years ago. Not much has happened beyond the usual feasibility studies and preliminary negotiations, but the European Union continues to include it among its projects of vital strategic interest, most recently in the updated plans for the Southern Gas Corridor, which was published a little over a month ago.
If Azerbaijan wants to become not just an energy producer but also a global energy hub, it needs this crucial piece of infrastructure. For Turkmenistan, a supply link to the west would be a welcome pathway to energy diversification, as it is currently much too dependent on China. To export natural gas to different markets, Turkmenistan needs to improve its pipeline infrastructure. At the time, there are two pipeline routes: one going to China with a current capacity of 55 billion cubic meters per year and another going to Russia with a capacity of 80 billion cubic meters. The Turkmenistan-China gas pipeline starts at Gedaim, a city at the Turkmen-Uzbek border, and runs through central Uzbekistan and southern Kazakhstan before reaching Khorgas in China’s Xinjiang Uygur Autonomous region. The pipeline has three lines each running in parallel for 1,830 kilometers and it reached a delivery capacity of 30 billion cubic meters per annum by the end of 2011 after several years in operation. According to British Petroleum, Turkmenistan ranks fourth in the world by volumes of gas reserves. However, the country faces a number of obstacles that prevent its reserves from reaching the world market. And since the beginning of 2016, Russia completely stopped importing Turkmen gas, leaving China as practically the only export market.
Predictably, Iran and Russia have criticized the Trans-Caspian project, which would greatly reduce their leverage over Europe. In 2011, for example, when talks to move ahead with construction of the Trans-Caspian pipeline seemed to be getting more serious, Russia stated that the project was a form of “meddling” and would increase tensions in the region. In 2012, Iran warned that the Caspian Sea’s other name—the Sea of Peace and Friendship—would change if construction of the pipeline went ahead. The pipeline would run from Turkmenbashi to Baku, where it would tie into the South Caucasus line, then the Trans-Anatolian line, and connect to the European gas network in Greece. This could well be the only way for Europe to ensure its access to energy in Central Asia without being dependent on either Iran or Russia.
One of the main obstacles has been the legal status of the Caspian. Should it be considered an inland sea, to be fully apportioned between the riparian states? In that case, the pipeline could be built through the Turkmen and Azeri zones. Or should it be considered a lake, in which case everything beyond a narrow fishing area must be jointly administered by all, including Russia and Iran? The geological history of the Caspian reveals a roller coaster of transformations, from the moment it was isolated from the ocean to the vast inland basin’s fracturing into smaller landlocked bodies of water. Its geopolitical history is equally convulsive. Before the fall of the Soviet Union, the Caspian was shared by only two states. A hundred years ago, it was essentially a Russian lake, with northern Persia very much under Russian control. Today, these two countries look at their three new neighbors—Azerbaijan, Turkmenistan, and Kazakhstan—with thinly disguised contempt as each year, they gain a new measure of independence that adds to the region’s geopolitical complexity.
Indeed, Eurasian pipeline politics is an occult science. Projects are announced and cancelled multiple times. Take the recent example of TurkStream, which seeks to link Russia with Turkey under the Black Sea. It is, arguably, a route that is capable of replacing the projected Tran-Caspian Pipeline. TurkStream had been at first considered after the European Union blocked progress on the development of South Stream, a pipeline designed to transport Russian natural gas from the Krasnodar region through the Black Sea to Bulgaria and onto Central and Western Europe. At the time, Turkey displayed a high level of diplomatic subtlety and nous: it managed to negotiate an understanding with Russia while gently prodding it to abandon the South Stream, thus gaining plaudits from the European Union as well. Afterward, the TurkStream ran into difficulties and was abandoned after the downing of a Russian bomber by the Turkish Air Force and relations between the two countries soured.
But later, the TurkStream deal resurfaced and was signed on October 10 during a meeting in Istanbul between Erdogan and Putin. It is enormously significant. No doubt, technical and financial challenges persist. I have been told, for example, that the sort of compressors needed to pump gas in the Black Sea can no longer be procured in Europe or the United States, since they fall under the existing sanctions regime, leaving only Japan as a possible, but likely reluctant, supplier. The investment in such technology is considerable and could be prohibitive if there is no firm guarantee that the gas can be sold in Europe as well as in Turkey. Since the same competition rules that doomed the South Stream are still in place, that guarantee is hard to obtain. Still, it would be a mistake to say that any of these projects will ever be completed. The world still needs oil and gas, so eventually there will be a winner, after governments and multinationals jostle to sabotage each other or to influence future projects with the cutting weapons of investor confidence. Pipelines are the continuation of war by other means.
It is no surprise, then, that the five riparian countries continue to build up their Caspian navies, anticipating a time of increasing competition for resources. In October 2015, Russia flaunted its considerable superiority in the area by ordering a Caspian Flotilla frigate and three destroyers to launch cruise missiles at 11 targets in Syria. The missiles traveled nearly a thousand miles, first through Iranian and then Iraqi airspace, before hitting sites in Raqqa, Aleppo, and Idlib provinces. This was at the very beginning of the Russian intervention in Syria, and the Flotilla has continued to play a strategic role in the conflict. Kalibr-armed missile boats that were deployed in the Caspian Sea have come to the aid of the Aerospace Defense Forces a number of times.
Shortly before sunrise, I left my freezing cabin and walked to the bridge of the ship, not before getting my hands on a full loaf of bread in the kitchen. We were now more or less in the middle of the Caspian near the disputed Kapaz oilfield. It was discovered by Azerbaijani oil workers during the Soviet period and has been a point of tension between Baku and Ashgabat due to its location on the median line between Turkmenistan and Azerbaijan. Azerbaijan has repeatedly demanded that no explorations be conducted in areas whose legal status has not yet been defined. As a result, the parties signed an agreement to refrain from exploratory or extraction activities in the field until the dispute is resolved.
The early light of the sky, which was stormy when we had left Alat, now promised a beautiful, clear day. Around noon, a second ghostly city appeared on the horizon, filled with tall, white marble buildings. I later learned that this was Avaza, one of the most improbable tourist resorts in the world. It consists of 30 or 40 hotels, a yacht club, and a congress hall, all built over the last decade and all in immaculate white marble. When I visited, there were no yachts or people in sight. In a country where electricity is provided for free, a stay in Avaza is also offered as a prize to a few exemplary state workers. Turkmenistan President Gurbanguly Berdymukhamedov has posed for pictures on his yacht, which is named Galkynysh, after the giant gas field in the country’s south. But Avaza is not just a bizarre seaside resort. If the Caspian Sea is a puddle of oil, it may just as well be a puddle with a yacht club and serve as a sophisticated mechanism to redistribute oil wealth among the elite, or as a receptacle for overseas wealth.
When we finally reached Turkmenbashi, a wonderfully picturesque city, nestled between the sea and low rocky mountains, it was a relief to see that it had been very much preserved as the Russian colonial outpost it once was—as the first station on the Trans-Caspian Railway, following the path of the old Silk Road all the way to Andijan in the Fergana Valley, the birthplace of the conqueror Babur. I also managed to take a look at the cargo that I had been riding alongside during the trip: used oil pipes, which originally came from Georgia, according to members of the crew who have finally made an appearance.
When looking at the Caspian Sea from a map, the cold distance it imparts might give the impression that it is a mere major transportation hub, connecting east to west, north to south. But up close, the small bizarro worlds on both sides of the Caspian shore are laboratories for economic and social transformation in an unstable but critically important region of the world.