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Article Excerpt
The Caspian Sea is estimated to be the world's third largest reservoir of oil and natural gas after the Persian Gulf and Russia. But, since the disintegration of the USSR in 1991, its rich resources have generated disagreement among the littoral states (Russia, Iran, Azerbaijan, Kazakhstan and Turkmenistan) over ownership of its resources. In addition, the region's huge energy potential has sparked intense competition among both the producer and the consumer countries regarding the final export routes of its oil and natural gas. This article will discuss different aspects of the rivalry among the coastal states, on the one hand, and foreign powers, on the other. Areas of cooperation among them will also be described.
GEOGRAPHY
The Caspian Sea is the largest enclosed body of water on the earth, larger than the American Great Lakes or Lake Victoria in East Africa. It is a saltwater lake situated where Southeastern Europe meets Southwestern Asia. The Caspian borders Azerbaijan and Russia on the west, Kazakhstan on the northeast and east, Turkmenistan on the east, and Iran on the south. It is approximately 1,030 kilometers long, while its width ranges from 435 km to 196 km. The water level varies from year to year. At 26.5 meters below mean sea level, its coastline is approximately 7,000 km in length and its surface area is about 386,400 square kilometers. The water volume of the sea at this level is about 78,700 cubic kilometers. (1)
Historically the water level of the Caspian Sea has been 26 m below sea level. (2) But a decline resulted in a reduction of its surface area from 430,000 [km.sup.2] in 1930 to 382,000 [km.sup.2] in 1957, leaving it at approximately 28 m below sea level. Within the last 160 years, the level of the sea has fluctuated between 25.2 m (1882) and 29 m below sea level (1977). The decline amounts to 3.8 m and 3.2 m in the last 100 years. As a result of a rise in the water level from 1975 to 1995, an area of 12,500 [km.sup.2] of land was flooded. (3) Scientists predict that the Caspian will continue to rise another one to one-and-a-half meters until 2020 and will then stabilize for the following 40-50 years at 26 meters below sea level. But this one-meter rise would flood many oil wells, pipelines and refineries along the Azerbaijan coast. (4)
According to Xavier de Planhol, the sea's estimated surface area in 1986 was 378,400 [km.sup.2] and its water volume 78,600 [km.sup.3]. It consists of three distinct sections. A shallow northern basin (91,942 [km.sup.2]), never more than 25 m deep and less than 5 m deep over two-thirds of its area, accounts for nearly 25 percent of the sea's total surface area but only 0.5 percent of total volume. The central and southern basins are deep. The central basin, with a surface area of 137,812 [km.sup.2], a maximum depth of 788 m and an average depth of 192 m, contains 33.9 percent of the total volume of water. The southern basin, with a surface area of 148,646 [km.sup.2], a maximum depth of 1,025 m and an average depth of 345 m, contains 65.6 percent of the volume. (5)
The sea's water is three times less saline than ocean water because it is a remnant of the ancient ocean Tethis. About 50-60 million years ago, Tethis connected the Atlantic and the Pacific Oceans, but, due to a gradual shift of continental plates, it lost its connection with the Pacific and later with the Atlantic. Approximately 130 large and small rivers flow into the Caspian Sea, almost all into the northern and western coasts. Over 90 percent of the inflow of freshwater is supplied by five large rivers: the Volga (the largest), Kura, Terek, Ural and Sulak. The Iranian rivers and the smaller streams on the western shores supply the rest. There are no permanent inflows on the eastern coast. (6)
The southern and southwestern coasts of the sea are bordered by the Elburz and Caucasus Mountains, respectively. Navigation is frequently dangerous due to violent southern storms. During the winter months, the northern parts of the sea are closed by ice. The chief ports are Krasnovodsk, Turkmenistan; Baku, Azerbaijan; and Makhachkala, Russia. (7)
The Caspian Sea has no outlet; however, it is linked to the Sea of Azov, the northern section of the Black Sea, through the Volga-Don and Manych Canals. The Sea of Azov is connected to the Black Sea through the Kerch Strait. The Volga and Don Rivers are connected at the closest locations between them by the 101-km-long Volga-Don Canal completed in 1952. (8)
OIL AND GAS RESERVES
The Caspian fields began producing oil near Baku, Azerbaijan, in 1871 and accounted for half of the world's limited production in 1900. (9) From 1872, the oil companies of Europe had been interested in Baku oil; Robert Nobel, along with his brothers Ludwig and Alfred, spent 25,000 rubles to develop Caspian fields and started an oil company in 1879. The first oil tanker in the world was commissioned on their orders in 1877. However, the industrial production of oil in the sea started in 1949 during the Soviet era. (10) The sea contains six separate hydrocarbon basins, most of which have not been developed yet. Most Azerbaijani oil resources, proven and potential, are located offshore, as are perhaps 30-40 percent of the total oil resources of Kazakhstan and Turkmenistan. In the tables below, proven oil and gas reserves are defined as 90 percent probable; possible oil and gas reserves are defined as 50 percent probable (see tables 1 and 2). (11)
OIL
Azerbaijan and Kazakhstan
Development of the region's oil resources has been led by three projects: the Tengiz and Karachaganak fields in Kazakhstan and the Azeri, Chirag and deepwater Gunashli (ACG) fields in Azerbaijan. These three projects produced an average of 693,000 barrels per day (b/d) from January to September 2006, roughly 30 percent of the regional total. Development of these decade-old key projects gave rise to an influx of new investment and infrastructure development that constitutes the "second Caspian oil rush," the first having occurred in the late 1800s. (12) The Tengiz field, Tengizchevroil, is being developed in a 50-50 joint venture worth $20 billion, begun in 1993 by Chevron and Kazakhstan. It is estimated that the field contains recoverable oil reserves of 6-9 billion barrels. Tengizchevroil produced 190,000 b/d in 1999 and 340,000 b/ d in 2002. It is expected to reach its peak of 750,000 b/d by 2010. In September 1994, the Azerbaijan International Operating Company (AIOC) signed an $8 billion 30-year contract to develop Azeri, Chirag and the deepwater portion of Gunashli, with proven reserves estimated at 3-5 billion barrels. Almost all of Azerbaijan's increase since 1997 has come from AIOC. The production from these fields is expected to reach 800,000 b/d by 2010. (13) Major discoveries were announced in Azerbaijan at Shah Deniz in 1999 (600 million barrels of condensate and 15 trillion cubic feet of natural gas) and in Kazakhstan at Kashagan in 2000 (7-9 billion barrels of recoverable oil with further potential totaling to 9-13 billion barrels using secondary-recovery techniques). (14)
Turkmenistan
Proven oil reserves in Turkmenistan are considerably smaller and markedly less developed than those in Azerbaijan and Kazakhstan. Some companies have been...
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