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Pipelineistan Goes Af-Pak

An immense energy battlefield extends from Iran to the Pacific Ocean. It's there that the Liquid War for the control of Eurasia takes place.

| Tue May 12, 2009 3:01 PM EDT

A Clinton-Bush-Obama Great Game

TAPI's roller-coaster history actually begins in the mid-1990s, the Clinton era, when the Taliban were dined (but not wined) by the California-based energy company Unocal and the Clinton machine. In 1995, Unocal first came up with the pipeline idea, even then a product of Washington's fatal urge to bypass both Iran and Russia. Next, Unocal talked to the Turkmenbashi, then to the Taliban, and so launched a classic New Great Game gambit that has yet to end and without which you can't understand the Afghan war Obama has inherited.

A Taliban delegation, thanks to Unocal, enjoyed Houston's hospitality in early 1997 and then Washington's in December of that year. When it came to energy negotiations, the Taliban's leadership was anything but medieval. They were tough bargainers, also cannily courting the Argentinean private oil company Bridas, which had secured the right to explore and exploit oil reserves in eastern Turkmenistan.

In August 1997, financially unstable Bridas sold 60% of its stock to Amoco, which merged the next year with British Petroleum. A key Amoco consultant happened to be that ubiquitous Eurasian player, former national security advisor Zbig Brzezinski, while another such luminary, Henry Kissinger, just happened to be a consultant for Unocal. BP-Amoco, already developing the Baku-Tblisi-Ceyhan (BTC) pipeline, now became the major player in what had already been dubbed the Trans-Afghan Pipeline or TAP. Inevitably, Unocal and BP-Amoco went to war and let the lawyers settle things in a Texas court, where, in October 1998 as the Clinton years drew to an end, BP-Amoco seemed to emerge with the upper hand.

Under newly elected president George W. Bush, however, Unocal snuck back into the game and, as early as January 2001, was cozying up to the Taliban yet again, this time supported by a star-studded governmental cast of characters, including Undersecretary of State Richard Armitage, himself a former Unocal lobbyist. The Taliban were duly invited back to Washington in March 2001 via Rahmatullah Hashimi, a top aide to "The Shadow," the movement's leader Mullah Omar.

Negotiations eventually broke down because of those pesky transit fees the Taliban demanded. Beware the Empire's fury. At a Group of Eight summit meeting in Genoa in July 2001, Western diplomats indicated that the Bush administration had decided to take the Taliban down before year's end. (Pakistani diplomats in Islamabad would later confirm this to me.) The attacks of September 11, 2001 just slightly accelerated the schedule. Nicknamed "the kebab seller" in Kabul, Hamid Karzai, a former CIA asset and Unocal representative, who had entertained visiting Taliban members at barbecues in Houston, was soon forced down Afghan throats as the country's new leader.

Among the first fruits of Donald Rumsfeld's bombing and invasion of Afghanistan in the fall of 2001 was the signing by Karzai, Pakistani President Musharraf and Turkmenistan's Nyazov of an agreement committing themselves to build TAP, and so was formally launched a Pipelineistan extension from Central to South Asia with brand USA stamped all over it.

Russian President Vladimir Putin did nothing—until September 2006, that is, when he delivered his counterpunch with panache. That's when Russian energy behemoth Gazprom agreed to buy Nyazov's natural gas at the 40% mark-up the dictator demanded. In return, the Russians received priceless gifts (and the Bush administration a pricey kick in the face). Nyazov turned over control of Turkmenistan's entire gas surplus to the Russian company through 2009, indicated a preference for letting Russia explore the country's new gas fields, and stated that Turkmenistan was bowing out of any U.S.-backed Trans-Caspian pipeline project. (And while he was at it, Putin also cornered much of the gas exports of Kazakhstan and Uzbekistan as well.)

Thus, almost five years later, with occupied Afghanistan in increasingly deadly chaos, TAP seemed dead-on-arrival. The (invisible) star of what would later turn into Obama's "good" war was already a corpse.

But here's the beauty of Pipelineistan: like zombies, dead deals always seem to return and so the game goes on forever.

Just when Russia thought it had Turkmenistan locked in…

A Turkmen Bash

They don't call Turkmenistan a "gas republic" for nothing. I've crossed it from the Uzbek border to a Caspian Sea port named—what else—Turkmenbashi where you can purchase one kilo of fresh Beluga for $100 and a camel for $200. That's where the gigantic gas fields are, and it's obvious that most have not been fully explored. When, in October 2008, the British consultancy firm GCA confirmed that the Yolotan-Osman gas fields in southwest Turkmenistan were among the world's four largest, holding up to a staggering 14 trillion cubic meters of natural gas, Turkmenistan promptly grabbed second place in the global gas reserves sweepstakes, way ahead of Iran and only 20% below Russia. With that news, the earth shook seismically across Pipelineistan.

Just before he died in December 2006, the flamboyant Turkmenbashi boasted that his country held enough reserves to export 150 billion cubic meters of gas annually for the next 250 years. Given his notorious megalomania, nobody took him seriously. So in March 2008, our man Gurbanguly ordered a GCA audit to dispel any doubts. After all, in pure Asian Energy Security Grid mode, Turkmenistan had already signed contracts to supply Russia with about 50 billion cubic meters annually, China with 40 billion cubic meters, and Iran with 8 billion cubic meters.

And yet, none of this turns out to be quite as monumental or settled as it may look. In fact, Turkmenistan and Russia may be playing the energy equivalent of Russian roulette. After all, virtually all of Turkmenistani gas exports flow north through an old, crumbling Soviet system of pipelines, largely built in the 1960s. Add to this a Turkmeni knack for raising the stakes non-stop at a time when Gazprom has little choice but to put up with it: without Turkmen gas, it simply can't export all it needs to Europe, the source of 70% of Gazprom's profits.

Worse yet, according to a Gazprom source quoted in the Russian business daily Kommersant, the stark fact is that the company only thought it controlled all of Turkmenistan's gas exports; the newly discovered gas mega-fields turn out not to be part of the deal. As my Asia Times colleague, former ambassador M.K. Bhadrakumar put the matter, Gazprom's mistake "is proving to be a misconception of Himalayan proportions."

In fact, it's as if the New Great Gamesters had just discovered another Everest. This year, Obama's national security strategists lost no time unleashing a no-holds-barred diplomatic campaign to court Turkmenistan. The goal? To accelerate possible ways for all that new Turkmeni gas to flow through the right pipes, and create quite a different energy map and future. Apart from TAPI, another key objective is to make the prospective $5.8 billion Turkey-to-Austria Nabucco pipeline become viable and thus, of course, trump the Russians. In that way, a key long-term U.S. strategic objective would be fulfilled: Austria, Italy, and Greece, as well as the Balkan and various Central European countries, would be at least partially pulled from Gazprom's orbit. (Await my next "postcard" from Pipelineistan for more on this.)

IPI or TAPI?

Gurbanguly is proving an even more riotous player than the Turkmenbashi. A year ago he said he was going to hedge his bets, that he was willing to export the bulk of the eight trillion cubic meters of gas reserves he now claims for his country to virtually anyone. Washington was—and remains—ecstatic. At an international conference last month in Ashgabat ("the city of love"), the Las Vegas of Central Asia, Gurbanguly told a hall packed with Americans, Europeans, and Russians that "diversification of energy flows and inclusion of new countries into the geography of export routes can help the global economy gain stability."

Inevitably, behind closed doors, the TAPI maze came up and TAPI executives once again began discussing pricing and transit fees. Of course, hard as that may be to settle, it's the easy part of the deal. After all, there's that Everest of Afghan security to climb, and someone still has to confirm that Turkmenistan's gas reserves are really as fabulous as claimed.

Imperceptible jiggles in Pipelineistan's tectonic plates can shake half the world. Take, for example, an obscure March report in the Balochistan Times: a little noticed pipeline supplying gas to parts of Sindh province in Pakistan, including Karachi, was blown up. It got next to no media attention, but all across Eurasia and in Washington, those analyzing the comparative advantages of TAPI vs. IPI had to wonder just how risky it might be for India to buy future Iranian gas via increasingly volatile Balochistan.

And then in early April came another mysterious pipeline explosion, this one in Turkmenistan, compromising exports to Russia. The Turkmenis promptly blamed the Russians (and TAPI advocates cheered), but nothing in Afghanistan itself could have left them cheering very loudly. Right now, Dick Cheney's master plan to get those blue rivers of Turkmeni gas flowing southwards via a future TAPI as part of a U.S. grand strategy for a "Greater Central Asia" lies in tatters.

Still, Zbig Brzezinski might disagree, and as he commands Obama's attention, he may try to convince the new president that the world needs a $7.6-plus billion, 1,600-km steel serpent winding through a horribly dangerous war zone. That's certainly the gist of what Brzezinski said immediately after the 2008 Russia-Georgia war, stressing once again that "the construction of a pipeline from Central Asia via Afghanistan to the south... will maximally expand world society's access to the Central Asian energy market."

Washington or Beijing?

Still, give credit where it's due. For the time being, our man Gurbanguly may have snatched the leading role in the New Great Game in this part of Eurasia. He's already signed a groundbreaking gas agreement with RWE from Germany and sent the Russians scrambling.

If, one of these days, the Turkmenistani leader opts for TAPI as well, it will open Washington to an ultimate historical irony. After so much death and destruction, Washington would undoubtedly have to sit down once again with—yes—the Taliban! And we'd be back to July 2001 and those pesky pipeline transit fees.

As it stands at the moment, however, Russia still dominates Pipelineistan, ensuring Central Asian gas flows across Russia's network and not through the Trans-Caspian networks privileged by the U.S. and the European Union. This virtually guarantees Russia's crucial geopolitical status as the top gas supplier to Europe and a crucial supplier to Asia as well.

Meanwhile, in "transit corridor" Pakistan, where Predator drones soaring over Pashtun tribal villages monopolize the headlines, the shady New Great Game slouches in under-the-radar mode toward the immense, under-populated southern Pakistani province of Balochistan. The future of the epic IPI vs. TAPI battle may hinge on a single, magic word: Gwadar.

Essentially a fishing village, Gwadar is an Arabian Sea port in that province. The port was built by China. In Washington's dream scenario, Gwadar becomes the new Dubai of South Asia. This implies the success of TAPI. For its part, China badly needs Gwadar as a node for yet another long pipeline to be built to western China. And where would the gas flowing in that line come from? Iran, of course.

Whoever "wins," if Gwadar really becomes part of the Liquid War, Pakistan will finally become a key transit corridor for either Iranian gas from the monster South Pars field heading for China, or a great deal of the Caspian gas from Turkmenistan heading Europe-wards. To make the scenario even more locally mouth-watering, Pakistan would then be a pivotal place for both NATO and the SCO (in which it is already an official "observer").

Now that's as classic as the New Great Game in Eurasia can get. There's NATO vs. the SCO. With either IPI or TAPI, Turkmenistan wins. With either IPI or TAPI, Russia loses. With either IPI or TAPI, Pakistan wins. With TAPI, Iran loses. With IPI, Afghanistan loses. In the end, however, as in any game of high stakes Pipelineistan poker, it all comes down to the top two global players. Ladies and gentlemen, place your bets: will the winner be Washington or Beijing?

Pepe Escobar is the roving correspondent for Asia Times and an analyst for the Real News. Parts of this article draw on his new book, Obama does Globalistan. His first "postcard" from Pipelineistan, "Liquid War," was posted at TomDispatch.com in March. He may be reached at pepeasia@yahoo.com.

Copyright 2009 Pepe Escobar

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