Analysis: Post-Niyazov Turkmen energy

By JOHN C.K. DALY, UPI International Correspondent

ANNAPOLIS, Md., Aug. 1 (UPI) -- The death of Turkmen leader Saparmurat Niyazov last Dec. 21 set off an unseemly but discreet scramble among a number of nations eager for access to the world's fourth-largest reserves of natural gas. Seven months later, the clear winner for the race to control Turkmenistan's energy is Russia, with China as also-ran, while the United States and other Western nations essentially lost.

What happened? The answer might be the Realtors' creed, "location, location, location."


Russia had the advantage of the existing, if decrepit, Soviet network of energy pipelines, which, if pricing issues were to be resolved, would allow an immediate flow of revenue and to Ashgabat's coffers.

The U.S. and Western plans, in contrast, proposed hugely expensive Caspian undersea pipelines toward Azerbaijan, across a sea whose offshore waters have yet to be delineated in a decisive manner 16 years after the collapse of communism. Four of the new Caspian coastal powers are former Soviet republics: Russia, Azerbaijan, Kazakhstan and Turkmenistan.


Iran, with whom the United States still has no formal diplomatic relations, is the fifth Caspian coastal power. The United States, promoting its undersea pipelines bypassing both the Russian Federation and Iran, the regional oil super-states, only generated substantial political pressure on the other three riparian states from both Russia and Iran, competitors for both Caspian assets and global market access.

The pressure not only affects rising pro-Western oil-producing states Azerbaijan and Kazakhstan but stymies any potential Western engagement with Turkmenistan.

All of Turkmenistan's suitors offered policy advantages: Russia, pre-existing transport network, allowing for immediate revenue flow; China, investment for pipelines and guaranteed markets; and the United States, access to cutting-edge technology.

The prize? While Turkmenistan produces modest amounts of oil, the country's real energy asset is its natural gas reserves estimated to be the fourth-largest in the world after Russia, the United States and Iran, gauged during the Soviet era to be 10 trillion to 14 trillion cubic meters. Turkmenistan's natural gas reserves are the second-largest in the former Soviet Union, exceeded only by Russia's.

In retrospect, however, the United States lost the race for Turkmenistan's energy riches at Niyazov's funeral. Central Asian Kremlinologists took careful note of the delegations assembled in Ashgabat, and in retrospect they are of interest.


Most Western obituaries of Turkmenbashi, or "leader of the Turkmen" as Niyazov came to identify himself, (or, in Turkmen Beyik Serdar, "Great Leader") emphasized the more outlandish aspects of his personality cult. His mourners, however, were of a much more pragmatic nature.

Crestfallen heads of state included Afghan President Hamid Karzai, Kazakh President Nursultan Nazarbayev and Tajik President Emomali Rakhmon. Iran's First Vice President Parviz Davoudi and Foreign Minister Manouchehr Mottaki were also present.

The Russian delegation included Russian Prime Minister Mikhail Fradkov, accompanied by former Prime Minister Viktor Chernomyrdin, now Russian ambassador to Ukraine.

Chinese President Hu Jintao sent special envoy State Councilor Tang Jiaxuan to Ashgabat for Niyazov's funeral. In June 1999 while deputy chairman of State Council, Tang visited Ashgabat and gave Niyazov a $12 million credit for Turkmenistan's oil and gas industry.

The most interesting "non-governmental" mourner was Alexei Miller, head of Russia's Gazprom, who led a delegation of high-ranking officials from the gas giant. The Russian delegation was by far the largest and most impressive, consisting both of high-ranking government officials and top businessmen.


In contrast, the United States saw fit only to send Assistant Secretary of State Richard Boucher. The U.S. State Department has 24 assistant secretaries of state, and in status-conscious post-Soviet Central Asia, the Turkmen leadership noticed what it saw as a diplomatic snub.

This combined with the fact the proposed U.S. undersea pipeline to Azerbaijan would necessarily involve Turkmenistan in not only the complex unresolved issue of Caspian offshore delineation; hostility from Russia and Iran, who share a common interest in negating any U.S. proposal, doomed Boucher's efforts from the outset.

Not that Turkmenistan was always in Russia's orbit. In January 2005 Turkmenistan cut off gas supplies to Russia and Ukraine over pricing disputes, in a pattern dating back to 1993 with former Soviet states. The high point in Niyazov's gas-pricing brinkmanship came in June 2006, when he forced Gazprom to agree to a 54-percent gas price increase in a 25-year bilateral accord under which Turkmenistan would supply Russia with 162 billion cubic meters of gas at $100 per 1,000 cubic meters.

Russia apparently learned its lesson. Washington, lecturing Turkmenistan on human rights and not even having an ambassador in Ashgabat when Niyazov died, is still on a steep learning curve.


Not that Russia is necessarily secure, as China is waiting in the wings.


(e-mail: [email protected])

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