Generals are consigned to fight the last war, as we know from the 118 million hits that Google turns up on the phrase. But must politicians? Such has been the spectacle this week in Istanbul, where the West and Russia did their best imitation of the uber-dramatic pipeline wars of the 1990s that established the United States as a key player on the Caspian Sea.
Meanwhile, 2,000 miles to the
east, an unchallenged China advanced another rook by signing
a preliminary deal to pipe Uzbek natural gas into Xinjiang, and
supported a fourth round of United Nations sanctions against
Iran on the condition that it could continue its gasoline trade with Tehran.
The
fight is over Europe's natural gas supply, and the perceived economic and
political muscle that goes with it. Russia's natural gas giant, Gazprom,
supplies some 25 percent of Europe's gas -- the figure rises to 100 percent in
Finland and the Baltic states -- and Washington and many former Warsaw Bloc
nations see this as a potent Russian economic and political weapon. Three times
in the last four years, Russia has cut off the natural gas flow in rows with
neighboring Ukraine, and Washington and the Europeans both want to lessen
Russia's market dominance by finding a competing supply.
Enter Nabucco, a proposed $9
billion, 2,100-mile pipeline that would ship some 30 billion cubic meters of
natural gas from the Caspian and elsewhere to Europe. This Western-backed plan
has set Russia on edge, resulting in South Stream, Moscow's retort to
Nabucco. Russia envisions building South Stream along much the same route as
Nabucco, and shipping double the volume.
There
has been much in the way of pyrotechnics because of this rivalry. In a way, it
is a reprise of the 1990s, when the United States and Russia vied to ship
Azerbaijan's oil bounty. The U.S. won that first round of pipeline politics
when the Baku-Ceyhan pipeline began transporting oil in 2006 (interestingly,
the main oil company in Baku, and Washington's main partner in the pipeline is
BP).
But
while both Russia and the West have attempted to replay their 1990s contest,
geology and technology have gotten ahead of them. In the United States, a Texan
named George
Mitchell figured out how to extract natural gas from shale, igniting a
gas-patch boom that is estimated to have provided the country with a 100-year
supply of natural gas. Meanwhile, Qatar has come on the market with the first
economically viable fleet of ocean-going liquefied natural gas tankers.
Together, the shale gas and LNG have
created a new ocean of natural gas. There is such a glut in Europe that,
according to a Bloomberg report today, Qatar has
decided to cut off two-thirds of its exports until the market settles.
All of this means that, unlike Baku-Ceyhan,
neither Nabucco nor South Stream actually have much gas to ship. When the
concept behind the Nabucco project originated in the 1990s, it was intended as
an essential link from the former Soviet states of Central Asia to the outside
world that would break Russia's then-monopoly on pipeline transport in the
region. But on Monday, Turkey and Azerbaijan got together to announce an
agreement that the
Azerbaijanis will ship just 6 billion cubic meters of natural gas a year in the
pipeline by 2019, or one-fifth of the envisioned volume; there is no other
supply in sight. But even if Nabucco's backers could somehow find the gas, it would
still represent just 5 percent of the 540 billion cubic meters that Europe currently uses.
Alexandros
Petersen, a senior fellow in the Eurasia Center at
the Atlantic Council, thinks the clock has not entirely run out on European
pipeline politics. He says the shale gas advances, for instance, "have yet
to revolutionize the heavily restricted European/Eurasian natural gas
markets." "2010 is a year of decision" for the pipelines to go
forward or not, Petersen says.
But Sam Charap, the associate
director for Russia and Eurasia at the Center for American Progress, thinks the
Nabucco-South Stream rivalry is a "distraction" for the Obama
administration. "The unconventional gas revolution has undermined"
the Nabucco project, he told me. Shale gas is known as unconventional gas;
conventional supplies are the stuff you pump out of the ground and deliver by
pipe.
In any case, there is still intrigue
on the Caspian. In December, China opened an 1,100-mile natural gas line starting in Turkmenistan, and
connecting into the Chinese natural gas grid in Xinjiang. Iran has done the
same in a smaller way, but
China is fast replacing the United States as the main geopolitical-balancer in
Central Asia. China's energy policy also undermines U.S. efforts to isolate
Iran, another Caspian Sea state. Here is Michael Klare on that topic.
China's investments are also giving
the country a lasting presence in Central Asia that, so far, the United States
has failed to match. It almost doesn't matter that the U.S. has put down
military bases in the region. The Manas
Air Base in
Kyrgyzstan is ephemeral; pipelines by comparison are forever. China, its eye
affixed on the original prize, has won the second round of pipeline politics.