BASIN OF INTERESTS

The Caspian Sea and its energy reserves are currently the focus of interest for the European and Asian world. On the geopolitical agenda, there is Azerbaijani and Central Asian gas, ways of delivery, and military capabilities. How will the Caspian cake be divided and how do the littoral countries intend to defend their interests? Our R+ correspondent spoke to the executive director of the American Association for the Advancement of Slavic Studies (AAASS), Dmitry Gorenburg.

- The September statement by the European Union Commissioner for Energy, Gunther Oettinger, that on behalf of EU member states the European Commission will start talks with Azerbaijan and Turkmenistan on the construction of the trans-Caspian gas pipeline has reverberated in Russia. The Kremlin does not agree for the gas pipe to go along the Caspian seabed the legal status of which has yet to be agreed by littoral states. Do you think Moscow can hamper the construction of the gas pipeline?

- This has been the Kremlin's consistent position since the idea of Nabucco was first discussed. Certainly, Moscow has some leverage in both capitals. I don't think Russian objections can stop the construction entirely, but they can certainly complicate it, both in terms of the logistics of construction and the political side. 

- It appears that a keen fight is under way for Caspian oil and gas transit routes. What is the actual state of things?

- This is a very broad question, that can't be completely addressed in a brief response. To my mind, the key development of the last couple of years is China's entry as one of the most significant players in Central Asian energy markets. The completion of oil and natural gas pipelines from Kazakhstan and Turkmenistan to China has definitively broken Russia's monopoly over energy exports from the Caspian region. Since Azerbaijan already had alternative pipelines, now all of the Caspian energy exporting states have a choice of export routes. This means that Russia will no longer have the ability to set terms for these countries. This is far more important for regional energy politics than whether or not the Trans-Caspian pipeline or Nabucco are actually completed. In either case, Turkmenistan will have the ability to set prices and export its gas. Nabucco is important for securing European supply in the short term, but in the long term, shale gas may reduce the European need for import of Caspian gas. So just to sum up, it seems to me that however the fight shakes out, both the countries of the region and the major customers will be ok. Russia, however, may end up as the ultimate loser in the medium to long term.

- Caspian oil and gas resources are not particularly large in global terms. How significant is it to the global economy that there is so much wrangling over these resources? Or is it the geopolitics?

- A lot of it is geopolitics, though the natural gas supplies are potentially significant, especially for China and Europe. By now, of course, energy security is a big part of geopolitics and is hard to separate. The potential profits for specific national and multinational energy companies also plays a role in encouraging the countries where these companies are based to get involved in the wrangling.

- Caspian littoral states decided at their latest summit to keep non-Caspian countries away from the sphere of Caspian security. Do you think the presence of non-Caspian states in the Caspian is possible? And what can this lead to?

- I think it is possible, but only in certain spheres. There is potential for participation by non-Caspian actors in helping local states to enhance their security programmes, particularly outside the military sphere. Areas like protecting energy infrastructure, countering narcotics smuggling and sturgeon poaching, and the policing and intelligence aspects of counter-terrorism are all areas where cooperation with the EU, the United States, and Turkey (and maybe even China down the road) is both feasible and even helpful for increasing security in the region. Cooperation in the military sphere is much more politically sensitive and therefore undesirable for the Caspian states.

- The Russian initiative to establish a joint (five-sided) security mechanism (the so-called KasFor) is not supported by three post-Soviet Caspian littoral states which fear that it may be used by Russia to step up its influence in the region. Can Russia use KasFor as a means of control over the Caspian basin?

- It could, if the other countries agreed to it. But all five Caspian states fiercely guard their independence in foreign policy. The other states see KasFor as a thinly veiled attempt by Russia to take control over Caspian Sea security and for this reason they refuse to support it. They're more willing to participate in bilateral security cooperation with Russia, as Kazakhstan recently did by participating in the maritime component of the Centre-2011 exercise.

- Is a decision on the legal status of the Caspian possible in the foreseeable future? What hampers the littoral states to resolve this issue today? 

- I don't see an overall decision coming soon. Resolution is prevented by the same thing that has stopped it all along -- disputes over natural resources. Any regime that is chosen will benefit some countries and disadvantage others. It seems to me that it is far more likely that the status quo will continue, with some countries making bilateral boundary settlements, as has already occurred in the north, but no real progress towards an overall settlement that would include a decision on the legal status of the sea.