By Antoine Blua, RFE/RL

Oil derricks on the shore of the Caspian Sea just outside the Azerbaijani capital, Baku.

For years, the race to tap into the Caspian Sea's vast oil and gas resources has outweighed any desire to protect its delicate environment.

All five littoral states -- Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan -- have plans to further exploit the sea's estimated 44 billion barrels of oil reserves.

Such projects mean drilling new wells, highlighting risks for an incident that could cause a catastrophic oil spill in the landlocked sea -- the largest inland body of water on earth.

Mais Gulaliyev, co-chairman of Azerbaijan's Green Party, tells RFE/RL's Azerbaijani Service he has called for measures to prevent such a threat from becoming reality.

"The accident in the Gulf of Mexico shows us that such a disaster could happen anywhere. The United States, with its super-modern technologies, is barely capable of stopping this disaster," Gulaliyev says. "You can imagine the scale of the damages to the environment from such incidents in countries like Azerbaijan."

At least 5,000 barrels of oil a day have been gushing into the Gulf of Mexico since an April 20 explosion destroyed a drilling rig leased and operated by BP, threatening unique wildlife refuges, beaches, and fishing grounds along the southern U.S. coast.

History Of Environmental Damage

The dangers of the Caspian Sea's oil fields gained international attention during the last days of the Soviet Union, when a well at Kazakhstan's huge Tengiz oil field blew out in 1985. The well burned for more than a year before it was eventually put out.

Makhamet Khakimov tells RFE/RL's Kazakh Service that little has been done since the incident in which 3 million tons of oil and tens of billions of cubic meters of different kinds of gases were burned, harming the population and wildlife in the Atyrau region.

Dozens of platforms are currently operating across the Caspian Sea, mainly in Kazakhstan and Azerbaijan, which have been the focus of Western investment.

Oil exploration and production work have also developed in the remaining three littoral states. LUKoil last month kicked off commercial oil production in the Russian sector of the sea, launching the Yury Korchagin platform. Iran earlier this year started drilling its first exploratory well in the southern Caspian Sea -- the deepest part of the sea -- to search for oil. Meanwhile, Turkmenistan is continuing exploration of Caspian shelf deposits along with foreign partners.

Environmentalists say investments in energy projects have often been made to the detriment of local communities.

On May 13, Kazakh Deputy Minister for Environmental Protection Eldana Sadvakasova acknowledged that with the oil price decreasing, oil-extracting companies had "stopped performance of some measures or postponed them for the later periods."

In February, a Kazakh court fined the onshore Karachaganak natural-gas venture, which includes BG, Eni, Chevron, and LUKoil, for environmental violations including excessive waste dumping. The village of Berezovka, which is situated less than 5 kilometers from the field and is exposed to the field's toxic emissions, has been fighting for justice for years.

Environmentalists say energy development is also threatening already endangered species of fish such as the Beluga, Stellate, and Russian sturgeon, the kilka (Caspian sprat), as well as the Caspian seal. In Turkmenistan, energy development is causing particular risk to the Krasovodsk Nature Reserve, home to hundreds of thousands of birds and more than 40 mammal species.

Caspian Sea region

Greater Supervision, Transparency Needed

Energy firms operating in the region, however, argue that they are doing their utmost to ensure the safety of their infrastructure.

"I assure you that we have done and will continue to do everything possible to ensure the full technical security of all our operations in the Caspian," says Tamam Bayatli, public relations manager for BP Azerbaijan, which is involved in a number of exploration and production projects in the country.

"It has been and will remain our No. 1 priority to ensure technical safety and security of the people as well as to protect the environment."

Environmentalists and civil-society activists say the authorities should better supervise the energy companies' work and call for the terms of production-sharing agreements between energy companies and host governments in the Caspian region to be made public.

Kate Watters, executive director of Crude Accountability, a Virginia-based nongovernmental organization that focuses on environmental justice, says the public should be informed about the investments being made and about the environmental and social protection needed to be put in place to safeguard the environment and the health of the local inhabitants.

"The oil companies need to be held to the highest standards, and those standards maybe need to be reexamined," Watters says. "We have a case [in the Gulf of Mexico] where governments are relying on the expertise of private corporations and putting at risk entire populations and ecosystems based on promises that need to be demonstrably fulfilled before a project starts."

Improving Regulation, Or Just Talk?

At a conference in Astrakhan on April 28, Russian Prime Minister Vladimir Putin said all work related to the development of fields in the Russian sector of the Caspian is being conducted "in strict compliance with international environmental standards," applying zero discharge technology. This means that waste resultant of production activities is not discharged into the sea, but is collected before being rendered harmless and reprocessed. Putin also voiced hope that companies from other countries operating in the region will join in this initiative.

On the regional level, the five countries around the Caspian Sea have ratified the Framework Convention for the Protection of the Marine Environment of the Caspian Sea, or Tehran Convention, and thus established a framework to jointly address and solve environmental problems in and around the sea.

But Watters is skeptical, saying the absence of public participation in the convention's preparation resulted in a relatively meaningless document.

As BP and the U.S. authorities battle to contain the spill in the Gulf of Mexico and issues of responsibility are being investigated, the U.S. administration has said it will review environmental procedures for offshore drilling.

And in Russia, the State Duma, or lower house of parliament, is considering the need for drafting a law on "environmental control and protection of seas from oil spills."

The head of the Duma's Committee for Natural Resources, Nature Management, and Environment, Yevgeny Tugolukov, announced the move on May 5 in comments on what conclusions Russia should make in the wake of the environmental disaster in the Gulf of Mexico.

And at a cabinet meeting on May 4, Kazakh Prime Minister Karim Masimov instructed the ministries for oil and gas and for environmental protection to inspect the country's oil-drilling platforms.

But Crude Accountability's Watters doubts the Kazakh measure will be effective. She notes that while BP "has this reputation all over the world for having the best technology, for being green, for being sustainable," the company is responsible for the spill in the Gulf of Mexico "and had absolutely no plan in place if something like this were to happen. So we have no guarantees that any Western company working in the Caspian would act any differently."

So while Watters believes the Kazakh government is acting correctly, "my question would be: 'Do they have the capacity to take care of an accident, should one happen?' And I think the answer is likely 'no.'"

RFE/RL's Azerbaijani and Kazakh services contributed to this report

... Payvand News - 05/25/10 ... --