Turkmenbashi reaches out


	January 24, 2002	atimes.com

Central Asia/Russia

Turkmenbashi reaches out
By Sergei Blagov

MOSCOW - Turkmenistan's leader visited Moscow this week, indicating that the isolationist Central Asian nation is keen to reach an agreement on dividing the Caspian Sea, as well as to clinch new energy deals with Russia.

The Russian and Turkmen positions "have become considerably closer", the official RIA news agency quoted Russian President Vladimir Putin as saying at his meeting with Turkmenistan's President Saparmurat Niyazov in Moscow on Monday.

However, the two leaders failed to achieve any breakthroughs. Putin and Niyazov just signed a joint statement and witnessed a largely ceremonial inking of minor deals on tax cooperation and on the launch of a Russian high school in Ashgabat, the Turkmen capital. The joint statement said that both nations were preparing a new major bilateral treaty as well as continued negotiations over long-term gas deal. The statement also urged other littoral states to reach an agreement on the status of the Caspian Sea.

Russia is urging the Caspian littoral states - including Azerbaijan, Iran, Kazakhstan and Turkmenistan - to reach agreements on how the Caspian Sea is to be formally divided among them. The Caspian, the world's largest inland sea, is a focal point of the accelerating clash of interests among Russia, the three other former Soviet republics and Iran - mainly because the 1,100-kilometer-long sea contains six separate hydrocarbon basins.

Continued disputes over the Caspian could entail violent conflicts, according to Viktor Kalyuzhny, Russia's special envoy on the Caspian. Russia has no claims to dominate the region, argued Kalyuzhny, who is also Russian deputy foreign minister.

The Caspian Sea region has been widely viewed as important to world markets because of its large oil and gas reserves. It has almost become an article of faith that the Caspian Basin is the Persian Gulf of the 21st Century. Potential oil reserves for the entire Caspian Sea region have been estimated at more than 235 billion barrels. However, in recent years the myth of Caspian riches has begun to fade as some oilfields seem not as lucrative as originally expected.

As an inland sea, the Caspian has never been subject to international maritime laws and its status was regulated by bilateral treaties of 1921 and 1940 between the former Soviet Union and Iran. In the wake of the Soviet collapse, Iran has suggested that the Caspian should be divided equally, with the five littoral states getting 20 percent of the sea each. According to the treaties of 1921 and 1940, Iran controls just 13 percent of the sea and is poised to benefit greatly from an equal division, but its post-Soviet neighbors disagree with such a formula.

Russia currently controls 19 percent of the Caspian - according to the length of its shore - and was also to gain from equal division. Not surprisingly, Kazakhstan (which holds 29 percent) and Azerbaijan (21 percent) were against the idea. Russia eventually changed its view and backed Azerbaijan and Kazakhstan, which argued for the delineation of the seabed but not the water itself. The surface of the sea should remain shared, while the seabed needs to be divided on the principle of equal distance or median line, basically according to the length of the shore, according to the Russian experts.

Turkmenistan and Iran have disagreed with Russia's plan for splitting the Caspian bottom along a "modified median line" while keeping the waters in common. Kazakhstan and Azerbaijan have agreed. Iran objects, seeking a larger share of the resources. Ashgabat's wavering stance has saved Iran from isolation.

On January 9, Niyazov predicted that the Caspian summit would be held this year, RIA reported. However, he warned that the summit could only be "an exchange of views", while the actual settlement of the status of the Caspian Sea remained some time off.

Niyazov has a long history of mercurial behavior. Notably, he has proved an unreliable negotiating partner on regional issues, including the development of Caspian Basin natural resources and in talks to determine the Caspian Sea's status.

When Putin visited Ashgabat in May 2000 it was his first visit abroad as president of Russia, yet Turkmenistan, an ex-Soviet Central Asian state of 4 million people, appears moving toward a bizarre, North Korea-like life-long presidency system. Turkmenistan is a one-party state dominated by its president and his closest advisers. Saparmurat Niyazov, head of the Turkmen Communist Party since 1985 and president of Turkmenistan since its independence in October 1990, is known in his republic as Turkmenbashi, or head of the Turkmens.

Niyazov, who builds huge statues of himself, is the focus of an increasingly bizarre personality cult. Also prime minister, he lives in a palace with a helicopter landing pad. His portraits are displayed on most buildings and streets in Ashgabat.

Turkmenistan is largely desert with cattle and sheep raising, intensive agriculture in irrigated oases. Agriculture, notably cotton cultivation, is responsible for roughly half of total employment.

On Monday, Putin announced that the first meeting of a Russo-Turkmen intergovernmental commission was to be held in Ashgabat next month. Bilateral economic ties would also include Turkmen cotton shipments to Russia. Gas, oil and cotton account for almost all of the country's export revenues. Russian pipelines are the main outlet for Turkmenistan, which is believed to hold the fourth-largest natural-gas reserves in the world and depends heavily on revenues from gas exports.

Therefore, Russia has several ways to pressure Turkmenistan. For instance, gas exports were halted in March 1997, when Niyazov suspended the Turkmen-Russian gas venture Turkmenrosgaz. Russia retaliated by blocking the pipeline and as a result Turkmenistan's gas output more than halved compared with 1996, and the country suffered huge losses.

"Some think that Turkmenistan should crawl to Russia because of its difficulties, but we shall cover our losses with sales of cotton, grain, oil and by speeding up other projects," Niyazov reportedly said then. However, eventually Turkmenbashi had to "crawl" to Moscow, because the Central Asian state has few options but to export gas.

Russian gas trader Itera recently renewed its contract to buy up to 10 billion cubic meters of gas and to transport larger volumes to Ukraine this year. But Russian purchases from Turkmenistan are well below the 30-year deal for 50 billion cubic meters annually that Putin discussed during his May 2000 visit to Ashgabat.

On Monday, Putin also suggested setting up a new economic body, a "Eurasian Alliance of Natural Gas Producers", to include Turkmenistan, Kazakhstan and Uzbekistan, around the nexus of Russia's system of gas pipelines.

It is no surprise that Turkmenistan, keen to reduce its heavy reliance on pipelines belonging to Russia, is considering construction of new gas export pipelines to or through a number of countries, including neighboring Iran and Afghanistan.

Niyazov said some time ago that Turkmenistan planned to ask the United Nations to provide security guarantees for a planned $2 billion pipeline to Pakistan via Afghan territory. More than half of the planned 1,500-km pipeline will be laid across Afghanistan. After the international peace-keeping operation in Afghanistan, pipeline plans could have new chances to materialize. Turkmenistan also plans to deliver up to 10 billion cubic meters of gas to Iran, compared with 2 billion cubic meters in 1999.

Thus, Turkmenistan's self-sufficiency and independence in terms of gas exports remains a matter of concern in Ashgabat. Nonetheless, increasing exports of Turkmen energy resources seems just a way of helping to sustain Niyazov's authoritarian regime.

Tomorrow: PIPELINEISTAN: The rules of the game
Part 1 of a two-part report by Pepe Escobar