Friday, August 8, 2008

BTC pipeline at risk in Georgia-Russia conlict

Would a war between Russia and Georgia be mainly about oil?

More than one percent of world oil (1 million barrels a day) passes through a pipeline that passes near South Ossetia. That's where war appears to have just broken out between Russia and Georgia. The Times reports:
The 1,770km (1,100 miles) Baku-Tbilisi-Ceyhan pipeline, which entered service only last year, pumps up to 1 million barrels of oil per day from Baku in Azerbaijan to Yumurtalik, Turkey, where it is loaded on to supertankers for delivery to Europe and the US. Around 249km of the route passes through Georgia, with parts running only 55km from South Ossetia.
The article mentions that the pipeline was attacked only last week (in Turkey by PKK rebels). It continues:

The latest eruption of violence could easily spur fresh attacks. The BTC pipeline, which is buried throughout most of its length to make sabotage more difficult, was a politically highly charged project. It was firmly opposed by Russia, which views the Caucasus as its own sphere of influence and wants central Asian oil to be exported via its own territory. [. . .]

The BTC pipeline, which cost $3 billion to build, is a key plank of US foreign policy because it reduces Western reliance on oil from both the Middle East and Russia.

Oil prices could rise further on this news. And the oil pipeline may be the source of the whole conflict between Russia and Georgia. At least, that's what DEBKA File reports:

The Russians may just bear with the pro-US Georgian president Mikhail Saakashvili’s ambition to bring his country into NATO. But they draw a heavy line against his plans and those of Western oil companies, including Israeli firms, to route the oil routes from Azerbaijan and the gas lines from Turkmenistan, which transit Georgia, through Turkey instead of hooking them up to Russian pipelines.

Saakashvili need only back away from this plan for Moscow to ditch the two provinces’ revolt against Tbilisi. As long as he sticks to his guns, South Ossetia and Abkhazia will wage separatist wars.

DEBKA claims the Israelis have been training elite units of the Georgian military. Israel has business interests in this pipeline/terminal route that runs via Turkey.

Map: Wikiped
Poster: The BTC pipline was featured in the 1999 Bond movie, The World is not Enough.

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