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10/16/07

Caspian Summit Fails To Resolve Key Question

By Bruce Pannier
 
October 16, 2007 (RFE/RL) -- The heads of state of all five Caspian littoral states -- Azerbaijan, Kazakhstan, Iran, Russia, and Turkmenistan -- arrived with pressure mounting to finally solve the problem of whether the biggest inland body of water is a sea or a lake.


The five leaders at the the Caspian Summit

 
That issue is key to clarifying the Caspian's legal status and establishing how to best exploit -- and export -- the vast energy reserves that lie under the Caspian seabed.

In their declaration at the end of today's summit, they simply pledged closer cooperation but left any specifics for future talks. They also pledged to refrain from some unilateral activities "until there is a definition of the new legal status of the Caspian."

The question of the Caspian's legal status has aggravated relations among the five states since the collapse of the Soviet Union in 1991 -- when suddenly five, not two, countries' shores were washed by its waters. In the absence of any new deal, relations and cooperation is still guided by treaties signed in 1921 and 1940.

Moscow was essentially able to call all the shots in both of those treaties, and there was little attention devoted to any eventual exploitation of fossil fuels like natural gas and oil.
 


A Sea Or A Lake?

The central question -- whether it is a lake or a sea -- quashed any real progress at the first Caspian summit more than five years ago.

If it's classified as a sea, then the bigger a country's coastal area, the greater the share it can expect to control and develop. Such a deal would greatly favor Kazakhstan -- not simply because it has the longest Caspian coastline but also because the rich Kashagan oil field and other potentially lucrative fields would presumably lie within its territorial waters. Kashagan is regarded as the largest oil field to have been discovered in decades.

Iran would be the biggest loser if the Caspian is defined as a sea, because its sector in the southern Caspian would be among the smallest and -- according to exploratory work -- its most energy-poor.

Not surprisingly, Tehran favors its definition as an inland lake. That would leave all littoral states sharing equally in the riches of the Caspian. As a result, profits from Kazakhstan's multibillion-dollar Kashagan oil field would be distributed equally among all five countries.

Moscow has traditionally favored labeling the Caspian a sea -- not merely because Russia's sector is the largest after Kazakhstan but also because Russian businesses are active on Kazakhstan's Caspian shore. But as indications emerged at today's summit that the sides failed to fully agree on all issues, Russian President Vladimir Putin said that the Caspian's "territory should not be covered with state borders, sectors, and exclusive zones. The less area they occupy, and the more the waters and the surface remain for common use by the Caspian states, the better."

Putin's comment appear to signal that Moscow would like each country to retain limited territorial waters extending only a few kilometers from the shore, not to a midpoint where it met another country's territorial waters.

Blocking Off National Interests

Also speaking at today's summit, Turkmenistan's President Gurbanguly Berdymukhammedov said that his country "has always followed the path of seeking mutually acceptable solutions, based on international law, that promote understanding and take measures to ensure the sovereign rights and lawful interests of the Caspian Sea states."

Berdymukhammedov became Turkmen president in December 2006. It was joked that his predecessor, Saparmurat Niyazov, changed his view on the Caspian frequently -- sea or lake -- depending on which other Caspian leader he had met with most recently. One constant in Niyazov's approach was that no disputed sector should be developed until an agreement was reached about who controlled that sector. This was due to a dispute with Azerbaijan about who owned an oil field that is called by Azerbaijan "Kapaz" and by Turkmenistan "Serdar," which lies somewhere along the midpoint between the two countries' coasts.

A further comment by Berdymukhammedov indicated that despite a warming of relations with Azerbaijan since Berdymukhammedov came to power, his country's policy regarding the disputed Caspian oil field has not changed. "The practice of unilateral actions in the Caspian Sea remains unacceptable for Turkmenistan," he said, "primarily the conducting of oil operations at sites that are not covered by agreements between the parties."


Putin and Ahmadinejad at the Caspian Summit
 

Russian President Putin also represented his country's interests today when he spoke about larger projects that would involve two or more Caspian neighbors. "I believe that projects that could be ecologically harmful to the entire Caspian Sea should not be, and must not be, implemented without mandatory preliminary discussion [by] the Caspian 5 and by adopting consensus decisions in the interest of the common Caspian Sea," he said.

Putin's statement appears clearly aimed at talks of trans-Caspian pipelines to carry oil and natural gas from eastern Caspian states Kazakhstan and Turkmenistan to Azerbaijan and further west. Such projects are backed by foreign businesses, not the least of whom are countries from the United States and Western Europe.

Another of Putin's comments again aimed at outside influence in the Caspian region, where currently Russian military might is undisputed. "It is also important that we talk about the impossibility of providing our own territory for other countries in case of aggression or some other military actions against one of the Caspian Sea states," he said.

The United States and other countries have been contributing to the fledgling naval forces in Kazakhstan and Azerbaijan, and to a far lesser extent Turkmenistan and the United States just a few years ago identified the Caspian as an area of strategic interest for Washington.
 

Copyright (c) 2007 RFE/RL, Inc. Reprinted with the permission of Radio Free Europe/Radio Liberty, 1201 Connecticut Ave., N.W. Washington DC 20036. www.rferl.org

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