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THE EMERGING ALLIANCE BETWEEN TURKEY, AZERBAIJAN AND GEORGIA
By Maria Beat*
Today's Zaman, Turkey
June 25 2007
When 15 years ago, following the socioeconomic developments in the
region, the six Black Sea states, Bulgaria, Georgia, Romania, Russia,
Turkey and Ukraine -- joined by their neighbors Albania, Armenia,
Azerbaijan, Greece and Moldova -- established the Black Sea Economic
Cooperation Organization (BSEC), an organization for regional economic
cooperation in the wider Black Sea area, the world at large had a vague
idea about the better part of the newly emerged post-Soviet economies.
Being for some 70 years a part and parcel of the Soviet communist
empire, those countries had national specifics, cultural peculiarities
and natural resources that remained all those years a puzzle to the
world at large.
Back in 1992 the international community had still to discover that
Russian oil or gas could have origins in Azerbaijan, Kazakhstan or
Turkmenistan. Nevertheless when it did happen, the Caspian region
immediately turned into a focus of international attention and the US
administration announced it a zone of special interest. American energy
experts have quickly come to believe that the landlocked Caspian Sea
holds a projected 3 percent of world's energy supplies, having 170
billion barrels of crude estimated as the world's third-largest oil
deposits after the Persian Gulf and Siberia.
Of the Black Sea states Turkey was the only country 15 years ago not
to have passed through the transformation processes experienced by
the former Soviet countries and the European people's democracies. As
such it became a natural center of an emerging regional integration
to replace the old ties of economic cooperation prevailing in the
Black Sea region in Soviet times. Enjoying an organic bond with the
post-Soviet Turkic republics, Turkey quickly established mutually
beneficial and fiduciary relations with the new states of Central
Asia and the Caucasus.
Though not a country of the southern Caucasus, Turkey for many
centuries has had close historic and cultural ties with the region,
specifically with Azerbaijan and Georgia. Their mutual links of
economic cooperation started actively developing after the Soviet
Union disintegration, and in a short time Turkey became a leading
trading partner both of Azerbaijan and Georgia. In addition Turkey
became greatly interested in the exploration and development of the
Azeri energy resources.
Regional integration gained its first success with the Baku-Supsa
oil pipeline, establishing a route for Azeri crude to the Black Sea
coast, passing through Georgia. The pipeline's completion proved
to Western companies -- who hadn't been to the region since 1917 --
that Azerbaijan and Georgia could ensure a safe operation of their
regional pipelines regardless of the unresolved conflicts existing
in their territories. That was an important development, since the
accomplishment took away any remaining doubt about the feasibility of
the construction of the Baku-Tbilisi-Ceyhan (BTC) crude oil pipeline
and later on the Baku-Tbilisi-Erzurum (BTE) natural gas pipeline.
Further on and in line with that development, Azerbaijan, Georgia and
Turkey had come to an agreement to build a new railroad connecting
Baku with Kars in Turkey via Tbilisi.
In the mid '90s Turkey offered an innovative solution to build a
1,700-kilometer-long pipeline from Baku through the territory of
Georgia and Turkey, terminating on the shores of the Mediterranean
Sea. The project received a boost with the US administration rendering
its strong support for the BTC's construction.
Turkey took a part in the BTC pipeline construction through the Turkish
Petroleum Corporation (TPAO), holding a 9 percent participation
stake. The BTC was successfully completed and later inaugurated in
July 2006 to become the longest oil exporting pipeline in the world;
an event of paramount importance for the world community.
For the world at large the BTC commissioning terminated Russia's
monopoly on crude exports to the West from the post-Soviet democracies,
while ensuring hopes for energy supply diversification.
For Azerbaijan it opened a direct way for selling Azeri crude to
the Western consumers, establishing a southern export route for oil
transportation through Turkey instead of Russia and forming a major
success in the independent development of Azerbaijan. In spring 2007,
following up on the BTC successfully gaining operational capacity,
President Ilham Aliev announced Azerbaijan's decision to stop using
Russian oil export transportation networks, resorting instead to the
Azeri national system.
No doubt the BTC brings the greatest benefit to Azerbaijan: In a couple
of years it will be pumping up to 80 percent of the oil belonging
to Azerbaijan and originating from the Azeri Chirag-Guneshli oil
fields. Azerbaijan is expected to be collecting about $30 billion
per year in oil revenues, while as transit countries Georgia
will be collecting transit fees of $600 million, and Turkey $1.5
billion. According to the Anatolia news agency, by June 2007, Turkish
revenue from the BTC reached $620 million for the period starting
June 4, 2006.
Turkish-Azeri active cooperation has resulted in a number of
broad-scope initiatives to become transnational projects of paramount
importance. The BTC oil pipeline, to bear a major impact on regional
developments, was followed by the BTE natural gas pipeline that
started in March 2007, bringing gas from the Shah Deniz offshore
Caspian block to northern Turkey.
As a participating partner in the project and when the pipeline
reaches its full operational capacity, Turkey will be receiving 6.6
billion cubic meters of gas annually from Azerbaijan. By the end of
2007 Turkey will receive 3 billion cubic meters at a fixed price of
$120 per thousand cubic meters -- half the price of Russian gas --
from Shah Deniz.
The BTC and BTE are the two pet US projects in the Caspian to have
reached success in terms of establishing an alternative export route to
the West from Azerbaijan. Actually, the only two projects -- increasing
Russian activity in the Caspian region seems to leave no room there
for any more foreign initiative. Those realized during the past decade
will most probably remain the only Western accomplishments in the
Caspian region for the foreseeable future. At least as long as Russia
is determined to dominate the oil and gas sector of the Caspian region.
Successful construction and commissioning of the BTC and BTE pipeline
projects have further contributed to the regional integration
processes in the wider Black Sea area and given shape to the emerging
politico-strategic integration between Azerbaijan, Georgia and
Turkey. Nevertheless skeptics believe that Azerbaijan, Georgia and
Turkey are not equal partners within their emerging regional alliance.
Azerbaijan's position is substantially stronger than Georgia's due to
its possession of the energy resources trans-shipped through Georgia.
Turkey also outweighs Georgia, by means of its terminal on the
Mediterranean coast, while Georgia remains a transit country. Still
it is Georgia that ensures the viability of the projects by allowing
them transit through its territory, be it via pipeline or railroad.
Georgia's strategic location on the way from the Caucasus to the West
through Turkey is its asset in terms of regional politics.
BSEC, an established institutionalized infrastructure for regional
development, is a natural framework for a successful development of
an emerging alliance of Turkey, Azerbaijan and Georgia. It has become
even more logical in the light of the EU's increased attention on
the Black Sea area and the EU Black Sea neighborhood policy unveiled
in April. Providing a platform for multilateral cooperation to its
member countries and the only regional institutionalized organization,
BSEC is successfully developing its own relations of cooperation with
the EU. As such it finds itself in a good position to organically
supplement the ongoing integration processes in the Black Sea region.
*Maria Beat is an international journalist and writer who specializes
in the CIS countries. Her email address is [email protected]
By Maria Beat*
Today's Zaman, Turkey
June 25 2007
When 15 years ago, following the socioeconomic developments in the
region, the six Black Sea states, Bulgaria, Georgia, Romania, Russia,
Turkey and Ukraine -- joined by their neighbors Albania, Armenia,
Azerbaijan, Greece and Moldova -- established the Black Sea Economic
Cooperation Organization (BSEC), an organization for regional economic
cooperation in the wider Black Sea area, the world at large had a vague
idea about the better part of the newly emerged post-Soviet economies.
Being for some 70 years a part and parcel of the Soviet communist
empire, those countries had national specifics, cultural peculiarities
and natural resources that remained all those years a puzzle to the
world at large.
Back in 1992 the international community had still to discover that
Russian oil or gas could have origins in Azerbaijan, Kazakhstan or
Turkmenistan. Nevertheless when it did happen, the Caspian region
immediately turned into a focus of international attention and the US
administration announced it a zone of special interest. American energy
experts have quickly come to believe that the landlocked Caspian Sea
holds a projected 3 percent of world's energy supplies, having 170
billion barrels of crude estimated as the world's third-largest oil
deposits after the Persian Gulf and Siberia.
Of the Black Sea states Turkey was the only country 15 years ago not
to have passed through the transformation processes experienced by
the former Soviet countries and the European people's democracies. As
such it became a natural center of an emerging regional integration
to replace the old ties of economic cooperation prevailing in the
Black Sea region in Soviet times. Enjoying an organic bond with the
post-Soviet Turkic republics, Turkey quickly established mutually
beneficial and fiduciary relations with the new states of Central
Asia and the Caucasus.
Though not a country of the southern Caucasus, Turkey for many
centuries has had close historic and cultural ties with the region,
specifically with Azerbaijan and Georgia. Their mutual links of
economic cooperation started actively developing after the Soviet
Union disintegration, and in a short time Turkey became a leading
trading partner both of Azerbaijan and Georgia. In addition Turkey
became greatly interested in the exploration and development of the
Azeri energy resources.
Regional integration gained its first success with the Baku-Supsa
oil pipeline, establishing a route for Azeri crude to the Black Sea
coast, passing through Georgia. The pipeline's completion proved
to Western companies -- who hadn't been to the region since 1917 --
that Azerbaijan and Georgia could ensure a safe operation of their
regional pipelines regardless of the unresolved conflicts existing
in their territories. That was an important development, since the
accomplishment took away any remaining doubt about the feasibility of
the construction of the Baku-Tbilisi-Ceyhan (BTC) crude oil pipeline
and later on the Baku-Tbilisi-Erzurum (BTE) natural gas pipeline.
Further on and in line with that development, Azerbaijan, Georgia and
Turkey had come to an agreement to build a new railroad connecting
Baku with Kars in Turkey via Tbilisi.
In the mid '90s Turkey offered an innovative solution to build a
1,700-kilometer-long pipeline from Baku through the territory of
Georgia and Turkey, terminating on the shores of the Mediterranean
Sea. The project received a boost with the US administration rendering
its strong support for the BTC's construction.
Turkey took a part in the BTC pipeline construction through the Turkish
Petroleum Corporation (TPAO), holding a 9 percent participation
stake. The BTC was successfully completed and later inaugurated in
July 2006 to become the longest oil exporting pipeline in the world;
an event of paramount importance for the world community.
For the world at large the BTC commissioning terminated Russia's
monopoly on crude exports to the West from the post-Soviet democracies,
while ensuring hopes for energy supply diversification.
For Azerbaijan it opened a direct way for selling Azeri crude to
the Western consumers, establishing a southern export route for oil
transportation through Turkey instead of Russia and forming a major
success in the independent development of Azerbaijan. In spring 2007,
following up on the BTC successfully gaining operational capacity,
President Ilham Aliev announced Azerbaijan's decision to stop using
Russian oil export transportation networks, resorting instead to the
Azeri national system.
No doubt the BTC brings the greatest benefit to Azerbaijan: In a couple
of years it will be pumping up to 80 percent of the oil belonging
to Azerbaijan and originating from the Azeri Chirag-Guneshli oil
fields. Azerbaijan is expected to be collecting about $30 billion
per year in oil revenues, while as transit countries Georgia
will be collecting transit fees of $600 million, and Turkey $1.5
billion. According to the Anatolia news agency, by June 2007, Turkish
revenue from the BTC reached $620 million for the period starting
June 4, 2006.
Turkish-Azeri active cooperation has resulted in a number of
broad-scope initiatives to become transnational projects of paramount
importance. The BTC oil pipeline, to bear a major impact on regional
developments, was followed by the BTE natural gas pipeline that
started in March 2007, bringing gas from the Shah Deniz offshore
Caspian block to northern Turkey.
As a participating partner in the project and when the pipeline
reaches its full operational capacity, Turkey will be receiving 6.6
billion cubic meters of gas annually from Azerbaijan. By the end of
2007 Turkey will receive 3 billion cubic meters at a fixed price of
$120 per thousand cubic meters -- half the price of Russian gas --
from Shah Deniz.
The BTC and BTE are the two pet US projects in the Caspian to have
reached success in terms of establishing an alternative export route to
the West from Azerbaijan. Actually, the only two projects -- increasing
Russian activity in the Caspian region seems to leave no room there
for any more foreign initiative. Those realized during the past decade
will most probably remain the only Western accomplishments in the
Caspian region for the foreseeable future. At least as long as Russia
is determined to dominate the oil and gas sector of the Caspian region.
Successful construction and commissioning of the BTC and BTE pipeline
projects have further contributed to the regional integration
processes in the wider Black Sea area and given shape to the emerging
politico-strategic integration between Azerbaijan, Georgia and
Turkey. Nevertheless skeptics believe that Azerbaijan, Georgia and
Turkey are not equal partners within their emerging regional alliance.
Azerbaijan's position is substantially stronger than Georgia's due to
its possession of the energy resources trans-shipped through Georgia.
Turkey also outweighs Georgia, by means of its terminal on the
Mediterranean coast, while Georgia remains a transit country. Still
it is Georgia that ensures the viability of the projects by allowing
them transit through its territory, be it via pipeline or railroad.
Georgia's strategic location on the way from the Caucasus to the West
through Turkey is its asset in terms of regional politics.
BSEC, an established institutionalized infrastructure for regional
development, is a natural framework for a successful development of
an emerging alliance of Turkey, Azerbaijan and Georgia. It has become
even more logical in the light of the EU's increased attention on
the Black Sea area and the EU Black Sea neighborhood policy unveiled
in April. Providing a platform for multilateral cooperation to its
member countries and the only regional institutionalized organization,
BSEC is successfully developing its own relations of cooperation with
the EU. As such it finds itself in a good position to organically
supplement the ongoing integration processes in the Black Sea region.
*Maria Beat is an international journalist and writer who specializes
in the CIS countries. Her email address is [email protected]