Wednesday, November 20, 2013

Brussels indulges in Trans-Caspian pipe dream again

After the European Commission has finally realized that major investors (RWE) and transit countries (Hungary) are leaving Nabucco, bureaucrats in Brussels are now trying to revitalize a distressed project – the so-called Trans-Caspian gas pipeline. Their goal is obvious – to find the lacking resources for a shorter version of Nabucco (the so-called Nabucco-West) and prevent its complete failure. Even in Europe many specialists in energy policy understand that without the gas of five Caspian littoral states including Iran, Nabucco will be a mere show of empty pipeline.
European experts in public relations haven’t given Trans-Caspian pipeline (TCP) project a pretentious brand name yet. And they had very good reasons to be cautious. Negotiations between Turkmenistan, Azerbaijan, and the EU on the construction of the Trans-Caspian gas pipeline have been ongoing since the late 90s. Despite extensive talks for more than 10 years, all summits and meetings were inconclusive. The European Union has made no financial commitment to the TCP project. What are the bottlenecks of the controversial pipeline? Why many politicians believe it still remains a distant prospect, not to say just another over-advertized pipe dream of Brussels?
First, legal status of the Caspian is currently unregulated. Therefore, territorial arguments among the littoral states are unavoidable. Even worse, two main stakeholders of the Trans-Caspian project, Azerbaijan and Turkmenistan, have unresolved disputes concerning gas fields: Baku and Ashgabat disagree over the ownership of the Kapaz/Serdar hydrocarbon deposit, which is needed to fill the pipe. Such issues are not easy to settle in reality, even if the European “big brother” is turning the heat on and demanding to get all the paperwork done in 2013.............

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