Web review

 

The BTC pipeline

 

 

The BTC pipeline is perhaps the most important project in the Caucasus seen so far. Several pipelines have been already constructed in the region but the BTC would (and will) revolutionize the Caspian Sea oil exploitation, as it will bring oil straight to the Mediterranean area. This huge project gathers the biggest oil companies in a consortium let by British Petroleum (BP) and the states of three countries: Azerbaijan, Georgia, and Turkey.  The BTC should give a high return on money and be a heavy weight in the south Caucasus economy (except from Armenia which is not involved in the project).

Nevertheless the BTC is a controversial project. NGOs and other independent observers keep on pointing out environmental and social weaknesses, dangers, the lack of transparency and the non observance of different commitments. Moreover, the BTC is about to change the geopolitical balance of the region with Russo-European/American struggles.

 

 

 

 

I  Presentation

 

A)    The project

 

Title: Baku – Tbilisi – Ceyhan project directorate

Link: http://www.btc.com.tr/eng/project.html

Source: “BTC project directorate” has been created, in 2000, within BOTAS in order to conduct all activities of BOTAŞ related with the design, engineering, land acquisition and construction works for the Turkish Section of the BTC P/L Project. Botas, Petroleum Pipeline Corporation is an affiliated company of Turkish Petroleum Corporation (TPAO) which is a part of the BTC consortium. This source can be seen as a Turkish official source as it comes from a company involved in the BTC project, however it is still Turkish oriented. 

Summary: This link explains the historic of the project, how it came out, its geopolitical and strategic context. Several studies had been done to elaborate the best way, negotiations had been discussed. In 1999 an "Intergovernmental Agreement of the Project" has been signed. Sponsors are organised, everything is made to proceed with the project in the most robust way. Botas will realise the BTC project in three phases. Three certificates are granted to the “BTC project directorate”. Investments costs are estimated to US$ 2.4 billion while the estimated cost for Turkish section, including land costs, is US$ 1.4 billion. Benefits of the project for Turkey are important.  Turkey will assume in the near future a major role in the transportation of rich reserves of 200 billion barrels crude oil and 18 trillion m3 natural gas of the Caspian Region to the world markets and to the European markets in particular.  

Lexicon:

·  Crude: Brut

·  Prominent: Proéminent, saillant, important

·  Feasibility: Possibilité (de realisation)

·  Pursue: Poursuivre

·  Vicinity: Environs, proximité

·  Apt: Enclin à, susceptible de, apte à

·  Sound : En bon état, sain, bon, solide

·  Increasing : Croissant

 

B)     Key fact

 

Title: BTC in brief

Link: http://www.caspiandevelopmentandexport.com/ASP/BTC_KeyFacts.asp

Source: “Caspian development and export” is the official web site concerning the BTC pipeline. BP is the main source, with a representative manager of the program from each country (Azerbaijan, Georgia, Turkey + USA). The BTC Company is a reliable source on a certain point of view. We have to expect from this source to reduce impact of several issues. Here, the link is completely reliable, as an objective key fact.

 

Summary: This very short link gives the main data of the pipeline: his length, his diameter, his design life, his capacity and other technical information.

Lexicon:

·  Pumping station: Station de pompage

·  Metering station: Station de mesure / de métrage

·  Length : Longueur

·  Design life : projet de vie

 

 

C)    Who is involved?

 

Title: The BTC partners

Link: http://www.caspiandevelopmentandexport.com/ASP/BTC_ProjectParticipants.asp

Source: “Caspian development and export” is the official web site concerning the BTC pipeline. BP is the main source, with a representative manager of the program from each country (Azerbaijan, Georgia, Turkey + USA). The BTC Company is a reliable source on a certain point of view. We have to expect from this source to reduce impact of several issues. Here, the link is completely reliable, as an objective key fact.

 

Summary: This very short link shows who are the partners in the BTC pipeline. It illustrates the consortium meaning which oil company is involved in the project. We can see on the diagram how much owns each company. As we can read it on the diagram BP is the main stakeholder with 30,1% followed by the state oil company of Azerbaijan. 

Lexicon: None

 

 

II  BTC pipeline meaning important stakes

 

A)    “The contract of the century”

 

Title: You can’ call this pipeline a pipedream now

Link: http://www.israeleconomy.org/strategic/socor5.htm

Source: This article first appeared in the Wall street journal Europe in 2002. The author, Vladimir Socor is a Senior Fellow of the Washington-based Institute for Advanced Strategic and Political Studies. The Institute for Advanced Strategic & Political Studies (IASPS) is a Jerusalem-based think tank with an affiliated office in Washington, D.C.  Its main focus is "limited government". Accordingly, IASPS pursues the limitation of Israeli socialist statism supported by US aid, by means of free market reform and a robust missile defence. The link between these economic and geostrategic policies reflects a critique of those policies which stand in opposition to limited government and affect an undermining of the elementary truths of human order.  At the purely political level, IASPS policies stand in opposition to those supportive of statism and the diminution of the balance of power.

 

Summary: Bringing Caspian fuels directly to consumer countries is the most important development in international energy economics and politics in the last 30 years. As the Middle East turns increasingly unstable now, Caspian reserves can make a critical difference, (both in terms of pricing and in diversification of energy supplies) to the enlarging Euro-Atlantic world. The oil pipeline from Baku to Ceyhan on Turkey's Mediterranean coast is designed to supply mainly the southern European markets in the first stage, and additional European markets afterward. With an operating life projected at 40 years, the Azeri-Chirag-Guneshli (ACG) offshore oilfields in Azerbaijan's sector of the Caspian Sea, valued at more than $10 billion. Of that sum, $ 5.2 billion is earmarked to bring these fields to full production at some 50 million tons annually by 2008. Initially, Moscow opposed both the extractive project and the pipeline. Once it realized that the Western companies were determined to go ahead with ACG, Russia reconciled itself to the development of those fields and allowed Lukoil to get a piece of that action. But it grew harsh in opposing the Baku-Tbilisi-Ceyhan pipeline, hoping in this way to discourage Western investment in that project, and to promote instead a pipeline route to Russia's Black Sea port of Novorossiisk. Only recently Moscow accepted the inevitable and softens its opposition to BTC. Clearly, the BTC project has acquired an unstoppable momentum. The pipeline could cement the Caspian producer countries' independence, anchoring them irreversibly to the Western consumer countries. 

Lexicon:

·  To launch: Lancer

·  Thereby: Par là, de cette façon

·  Volatile : Instable, versatile

·  Flow : Courant, cours, passage, écoulement

·  Downstream : En aval

·  To tone down : Atténuer, édulcorer, ménager, adoucir

·  Scope : Envergure, portée, limites

·  To circumvent : Circonvenir, contourner

·  Leverage : Force de levier, prise

·  Shrill : Aigu, aigre, perçant

·  Momentum : élan

 

B)     Strategic significance to the Western world

 

Title: From the Caspian to the Mediterranean: The East-West Energy Corridor is becoming a Reality                                                                                                                          Link:  http://www.inthenationalinterest.com/Articles/Vol2Issue8/vol2issue8baran.html Source: In the National Interest is an online weekly, a partnership between The National Interest and The Nixon Centre, designed to provide insight and analysis of American foreign policy and world events from a realist perspective. The National Interest is a prominent quarterly international affairs journal, founded in 1985 and published by Irving Kristol. The National Interest is not restricted in content to “foreign policy” in the narrow, technical sense, but attempts to pay attention to broad ideas, and the way in which cultural and social differences, technological innovations, history, and religion impact the behaviour of states. It is often critical of positions taken by its rival journal, Foreign Affairs, which many see as reflecting the dominant position within the U.S. State Department.

Summary: According to Azerbaijan’s president, and many other politics, the BTC pipeline is an East-West energy corridor. Supported by the United State, the project will allow Azerbaijan and Georgia to strengthen their independence, as the oil export route will not be run through Russia anymore. However the export routes to Turkey should not be viewed as anti-Russian. In fact, we can suppose that there will be increased cooperation between Georgia, Russia and Turkey concerning oil exports. Iran is as well isolated from the BTC pipeline. For the BTC countries the big challenge is to use the project to promote transparency and accountability. The hope is that the pipeline will help, and not hamper, the regional stability and security. This East-West corridor should help to ensure the energy security of the western world as well as benefit to the nations of the region 

Lexicon:

·  To strengthen: Renforcer, fortifier

·  Engine: Machine

·  Hub: Moyeu, plaque tournante

·  Increment: Augmentation

·  To handle: Manier, manipuler, traiter, s’occuper de

·  To hinder : Gêner, entraver, retarder

·  To broaden : S’élargir, élargir, étendre

·  To predict : Prédire

·  To deliver : Livrer, distribuer, délivrer

 

 

 

 

Title: Iran the "only and biggest" loser in the BTC pipeline project

Link:            http://www.iranpressservice.com/articles_2002/sept_2002/btc_%20pipeline_%20inked_18902.htm

Source: Iran Press Service is a fully independent and private news gathering and disseminating service from Iran. This source has to be taken carefully in the BTC view, as Iran is not involved in the project and seems to be very disappointed about it.

 

Summary: Teheran stands to be the absolute loser and the United States the foremost winner. The historic opening ceremony day it is a big victory for Washington’s diplomacy and a black day for Iran. With an isolationist policy, continuing hostilities with the United States and neglecting development of relations with its new neighbours in Central Asia and Caucasus, Iran has lost all opportunities for becoming the main highway of transfer of the region’s energy to outside world. This situation would help both the United States and Europe to become less dependent on the Persian Gulf oil and gas.

Lexicon:

·  Shameful: Honteux

·  Treachery: Traîtrise

·  Betrayal: Trahison

·  Tale: Conte

·  Component: Partie constituante, composant

·  To rank: Ranger, classer, compter

·  To enhance: Rehausser, mettre en valeur, relever

 

 

III The BTC issues

 

 

A-    The environmental risks

 

 

Title: WWF alarmed at World Bank inaction on BTC pipeline decision

Link: http://www.panda.org/news_facts/newsroom/news.cfm?uNewsId=9504&uLangId=1

Sources: Established in 1961, with almost five million supporters distributed throughout five continents, WWF has a global network active in over 90 countries and has played a major role in the evolution of the international conservation movement. They are currently funding 2,000 conservation projects and provide work for almost 4,000 people around the world. They have prioritized areas around the world which represent globally outstanding examples of biodiversity and that they call these the "Global 200" ecoregions. In a selection of these, WWF is working with local communities, government agencies, partner NGOs, and key businesses to implement programmes to ensure the long-term security of these very special places.

Summary: WWF has called for a NO vote in a vital IFC (International Finance Corporation, member of the World Bank group) Board meeting in November 2003 to prevent the funding of a potential ecological and social disaster. WWF has gathered evidence that demonstrates that the World Bank, particularly the IFC, has not applied its own environmental and social standards in assessing the viability of the pipeline. The conservation organization believes the World Bank has a responsibility to ensure it only supports projects that meet the highest environmental and social standards. Failure to do so in relation to BTC sets an unacceptable precedent for future pipeline approvals and could encourage commercial banks and investors to support similarly controversial pipeline projects elsewhere.

 

Lexicon:

·        Stakeholder:

 

 

 

Title: “BP, its pipeline, and an environmental timebomb” By Philip Thornton, Economics correspondent the Independent.                                                                                             Link: http://www.foe.org/camps/intl/institutions/bakuceyhan.html                                        Sources: Friends of the Earth is the U.S. NGO of an influential, international network of grassroots groups in 70 countries. Founded in San Francisco in 1969 by David Brower, the headquarter are based now in Washington, Friends of the Earth has been for decades at the forefront of high-profile efforts to create a more healthy, just world. They are now the world's largest federation of democratically elected environmental groups, Friends of the Earth International.

 

Summary: In this article the author argue that the safety of the BTC pipeline has been jeopardised by cost-cutting, incompetence and shoddy workmanship by contractors. A dossier, seen by The Independent, include evidence given by former senior workers which reveal a catalogue of failures they say could lead to a major oil leak that would devastate one of the world's most environmentally sensitive areas. Observers record that builders cut off villages' water supplies, flooded farmland and allowed oil leaks, there were insufficient checks for the risk of the pipe buckling in earthquake zones, crucial welding work often failed inspections, those who complained were sacked or made to leave and at last that workers handled toxic coating materials without proper health and safety equipment. Furthermore it is quite obvious that BP is not in control of the Turkish section of this pipeline.

Lexicon:



 

B- The social impacts

 

Title: Social impacts of the BTC pipeline

Link: http://www.bakuceyhan.org.uk/more_info/social.htm 

Sources: The Baku Ceyhan Campaign is a project; settle in oxford, to raise public awareness of the social problems, human rights abuses and environmental damage that will be caused by the Baku-Tbilisi-Ceyhan oil pipeline. This project has been set up by the Llisu Dam Campaign which worked to stop British involvement in the Ilisu Dam and to highlight the wider implications of Britain's ethical foreign policy, sustainable development and its effect on peace and security in the region. The Ilisu Dam Campaign was set up by the Kurdish Human Rights Project, The Corner House, Friends of the Earth and Mark Thomas. These campaign are working with international NGO like CEE Bankwatch Network, Friends of the Earth International, all working individually on issues connected with BTC, but also collaboratively to achieve those ends describes above.

 

Summary:

According to this article the social impact of the BTC can be expected on different sides.

In first the land lost or destroyed which concern 20 000 families in turkey alone. While BP says it will compensate people for their land, in practise the company is used to pay (as it has been seen for other pipeline) only for the narrow corridor, and generally undervalued. Beside there is another deeper problem, the compensation regime in turkey deciding to compensate the officially registered title-holders of the land taken by the company whereas a very large proportion of the land along the route of the pipeline are actually in the name of people who are now dead, the villagers preferring to use informal methods of land titling.

In Azerbaijan the economy might suffer from Dutch disease – the name for the phenomenon where an economy regresses rather than grows due to oil investment. One of the main reasons is that the economy’s capacity is all taken up by the oil development, sucking resources out of other sectors. The export of almost all of the oil produced in Azerbaijan has led to severe restriction of the petrochemical industry, and the loss of jobs.

Whereas BP claims the main potential benefit to communities from the BTC pipeline is the opportunity of jobs during construction these ones appear to be few, short-term and poorly paid. NGOs in Azerbaijan also complain of discriminatory labour practices by BP with jobs going to non-Azeri staff despite the local availability of the required skills, and with foreign workers being paid far more than locals.

On the political level the Host Government Agreements for Azerbaijan, Georgia and Turkey commit all three governments to insure the full costs of ensuring security for the pipeline and the costs of compensating the BTC consortium for any losses incurred as a result of the introduction of new social and environmental laws over the next 40 years. As no budgetary provisions appear to have been made by any of the host governments to cover such expenditure, we can expect raising the prospect of future national debt further harming the prospects of their populations.

In the social impacts of the BTC pipeline we can also count the corruption problems. Azerbaijan is ranked by Transparency International as the world’s third most corrupt country. High levels of corruption have also been reported in Georgia, and in Turkey the World Bank says that contractors have traditionally been asked to pay up to 15% of the value of state contracts to politicians as "state contributions". The lack of transparency, against a background of extensive corruption, will lead to an unfair distribution of any benefits that do come from the pipeline.

 

Lexicon:

 

 

 
C-The militarization and human right question

 

Title: Conflict, militarization, human rights and the Baku-Tbilisi-Ceyhan pipeline

Link: http://www.bakuceyhan.org.uk/more_info/humanrights.htm

Sources: The Baku Ceyhan Campaign is a project; settle in oxford, to raise public awareness of the social problems, human rights abuses and environmental damage that will be caused by the Baku-Tbilisi-Ceyhan oil pipeline. This project has been set up by the Ilisu Dam Campaign which worked to stop British involvement in the Ilisu dam and to highlight the wider implications of Britain's ethical foreign policy, sustainable development and its effect on peace and security in the region. The Ilisu Dam Campaign was set up by the Kurdish Human Rights Project, The Corner House, Friends of the Earth and Mark Thomas. These campaign are working with international NGO like CEE Bankwatch Network, Friends of the Earth International, all working individually on issues connected with BTC, but also collaboratively to achieve those ends describes above.

 

Summary:

One of the most important arguments feeding the controversy around the BTC pipeline is that its route passes through or near seven different war-zones, which makes very credible to see the pipeline, at some point in the next 40 years, caught up in a conflict inflamed by its own activities.

Therefore the BTC pipeline would pass just 10 miles from Nagorno-Karabakh, the area of Azerbaijan occupied by Armenia, where a bloody conflict killed at least 25,000 people and created at least a million refugees.

It would pass also through Georgia, which remains unstable, with separatist movements in Abkhazia and South Ossetia – movements which the Georgian government tried to violently suppress during the 1990s.

Besides just across the border into Russia, and still only 70 miles from the BTC pipeline route, the conflict in Chechnya continues. The region also saw related conflict in neighbouring Dagestan in 1999, and fighting between the Russian republics of North Ossetia and Ingushetia in 1992.

At last in Turkey, the BTC route passes through the edge of the area where still recently the ceasefire between the Turkish state and the Kurdistan Workers Party (PKK) was fragile. Meanwhile there is already evidence that some groups in these different areas may be disposed to sabotage the pipelines system. If these fears are realised, the human toll could be devastating.

Against this background of persistent conflict, Azerbaijan, Georgia and Turkey are heavily – and increasingly – militarised. There are effectively clear indications of the host states’ plans to militarise the region of the pipelines system, which would carry grave risks for stability in the region and for human rights.

Lexicon:

 

 

 

 

CONCLUSION

 

 

The BTC pipeline will allow additional export of one milion barrels of oil per day from the Azeri-Chirag-Gunashli (ACG) oilfield in the Caspian sea to the Mediteranean, for shiping to world market. Many issues suround the project and BTC Co has made considerable effort to understand them. Management of these issues will reduce adverse impact and risks to a minimum, and enhance the environmental and social benefits from the project. There will inevitably be some residual impacts despite the extentive mitigation measure that are planed. It is the opinion of BTC Co that these impacts are outweight by the benefits the project will bring to the region. The benefits of the project will be to bring substantial revenue to the economies of Azerbaijan, Georgia, and Turkey, to provide a model for transparent buisness in the region, to provide direct economic benefits to communities along the pipeline route, to invest in environmental protection and community development, and to increase the body of knowledge about the environment and society in the region.

 

But behind the official project and statements from BTC and the three host countries, environment and human right groups and NGOs have discovered a lot of irregularities in the realisation of a building site already very controversial for the potentially high dangers it could create by its geopolitical situation and the unfair distribution of wealth from the Caspian exploitation. These observers record the lack of transparency about the politics of compensation for the inhabitants living in the pipeline zone, the conditions of protection and militarization of the corridor in high tension area and the weakness of the precaution measure against a natural or criminal incident which would make an ecological catastrophe in a very rich and fragile ecosystem. They try therefore to attract the attention of the journalists on a grave topic widely under media coverage so as the international opinion could create a control to avoid drifts and warm from other petroleum consortium abuse in the future with the next pipelines projects.