Gas Pipeline Bounces Between Agendas
By David B. Ottaway and Dan Morgan
The 100-acre complex is the collection facility for one of the world's largest gas fields "a jewel given to us by God," as one Turkmen gas official described it. But for more than a year Dauletabad has been as silent as the half-buried cities that lie along the abandoned caravan route between China and the Mediterranean.
In August 1997, in a bold move that conjured up memories of 19th-century Turkmen khans staving off would-be Russian conquerors, President Saparmurad Niyazov halted gas deliveries to the Russian-controlled pipeline system that was built during the Soviet era. Niyazov said he "smelled old Soviet ambitions" in Russia's use of its pipeline monopoly to keep Turkmenistan's gas from competing with Russian gas in European markets. Soon, he hinted, Turkmen gas could be shipped south through Iran.
For Niyazov, a product of the Soviet system, the closing of the valves was a dramatic declaration that business as usual was over. The sudden availability of 2.8 trillion cubic feet per year of gas previously committed to the Russian pipeline system propelled Niyazov from an obscure Central Asian strongman to a central figure in an intricate geopolitical drama that has drawn in Washington, Tehran, Moscow and assorted regional capitals.
While the prize in the Caspian is an energy patch whose size is believed by many to exceed those in Alaska and the North Sea, the overarching issue is how to get the commodity out of landlocked Central Asia. The politics of pipelines seems as tangled as the routes themselves, and each route carried its own treacherous obstacles. But a simple ambition had come to unify American policy in the region: Tap the Caspian mother lodes while giving as little leverage as possible to Russia in the north and Iran in the south.
Across the Caspian, Azerbaijan had already enlisted U.S. oil companies and pulled the Clinton administration into a crusade to build pipelines that would skirt Russia on the way to the Black Sea and the Mediterranean. In Kazakhstan, the Clinton administration was about to risk provoking Moscow again by promoting pipelines that would carry Kazakh oil to western markets without Russian interference.
Now Turkmenistan had entered the game. By defying the Russians and hinting at a partnership with Iran, Niyazov was suddenly someone to be reckoned with. From Washington's perspective, the stakes were high enough to put this remote nation of 4 million people on the U.S. policy agenda. Niyazov was a player, and he had anted up one of the biggest gas reserves on Earth.
Choice Fields Sold Off
In the first years after winning independence in 1991, Turkmenistan seemed as obscure and unobtrusive as ever. Naive Turkmen officials auctioned off choice oil and gas fields for as little as $100,000 to foreign opportunity seekers. Among those who picked up cut-rate concessions were a Dubai car salesman, a Swedish real estate magnate and Roger E. Tamraz, the Lebanese American entrepreneur who subsequently became entangled in a U.S. Senate investigation of his donations to the Democratic National Committee.
Turkmenistan's potential was enormous. Just inland from the Caspian shore were some of the world's oldest oil fields, and Soviet-era geological surveys indicated that the prospect for offshore finds was good. In the trackless Garagum Desert, away from a thin line of irrigated valleys, geologists had discovered one gas field after another beginning in the 1960s. By 1990, Dauletabad and the adjoining Sovietabad field were producing 1.6 trillion cubic feet a year, rivaling the gigantic gas fields of Siberia.
Almost all of this gas was pumped north across Uzbekistan and Kazakhstan into a Russian pipeline and on to markets in Europe and the former Soviet republics.
Alexander M. Haig Jr., a businessman who had served as NATO commander and secretary of state, was one of the first Westerners to propose that Niyazov end his dependence on Russian pipelines. Haig arrived in Turkmenistan in 1992 representing a U.S. investment company. The retired general stood apart from other foreign businessmen courting Niyazov's favors. As a denizen of boardrooms and executive suites, he seemed an unlikely comrade for Niyazov, a former Communist party boss partial to boisterous evenings of vodka-drinking. But Niyazov believed that in Haig he had access to the U.S. power structure, according to sources who observed the relationship.
Haig became an unofficial Niyazov adviser and confidant, screening foreign companies and helping arrange a Niyazov visit to Washington in 1993. But the autocratic Turkmen leader was still being shunned by the new Clinton administration, and the closest Niyazov got to the White House was his room at the Madison Hotel five blocks away.
That same year Haig formed a consortium with the idea of building a small pipeline to carry modest amounts of Turkmen gas across Iran to Turkey. But the project did not involve U.S. companies; Haig's pipeline enterprise was registered in the British Virgin Islands.
Haig's consortium won endorsements from the energy ministers of Kazakhstan, Iran and Turkey, and the sultan of oil-rich Brunei was ready to invest, according to Charles D. Hartman, a Haig associate. But in Washington, economic initiatives involving Iran were still poison. The Clinton administration, like its predecessors, favored relentless international isolation of the Tehran regime for allegedly supporting terrorism.
In March 1995, the White House stepped in to block a $1 billion oil deal between Conoco Inc. and Iran. Soon afterward, National Security Council officials let Haig know that the government opposed his project, too, and the idea died.
© Copyright 1998 The Washington Post Company