Drillbits and Tailings , (an electronic monthly on the mining & oil industries), Volume 6, Number 8, October 31, 2001  February 2002

Centre for Research on Globalisation (CRG),,   10  February 2002


 We have synthesized a number of current analyses into some key facts about how oil ties into the US government's long time involvement in Central Asia and its hopes of accessing the oil and gas riches of the area. Oil is clearly not the only force operating, and this is not a comprehensive analysis, but it is an important piece of a complicated political and economic struggle.

The United States has yet to provide concrete evidence that Osama bin Laden was behind the attacks, but has pursued a bombing campaign anyway against the Taliban and bin Laden with millions of innocent Afghanis caught in the middle. Some analysts are projecting a post-war Afghanistan where the US military is used as "pipeline police." Following are some key points in how US oil interests play into the current so-called "war on terrorism."

CENTRAL ASIA includes Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Turkmenistan, Afghanistan and Pakistan, parts of India and China. For a map of the area go to:

THE CASPIAN BASIN includes the Caspian Sea and surrounding countries, Azerbaijan, Iran, Turkmenistan, Kazakhstan, Turkey and Georgia. For a map of the area go to:

THE PERSIAN/ARABIAN GULF STATES include Saudi Arabia, Iraq, Iran, Kuwait, Qatar, United Arab Emirates, Oman. For a map of the area go to:

The Central Asian Republics and the Caspian Basin are Staggeringly Resource Wealthy:

The Caspian Basin has an estimated US$5 trillion of oil and gas resources. (1)

Central Asia has enormous quantities of undeveloped oil resources including 6.6 trillion cubic meters of natural gas and 10 billion barrels of undeveloped oil reserves. (2)

Uzbekistan and Turkmenistan are the two major gas producers in Central Asia. Turkmenistan contains the world's eighth largest natural gas reserves. (3)

The United States is Resource Poor and the Largest Consumer of Oil:

The United States has only 3% of the world's known oil reserves. (4)

Imports accounts for 60% of America's daily oil consumption, 13% of that comes from Persian/Arabian Gulf States which produce 18% of the world's supply of oil.

With less than 5% of the world's population, the US accounts for over 25% of the world's oil consumption (5).

The United States would like to control Caspian Sea and Central Asian oil in order reduce dependency on oil from the Persian/Arabian Gulf, which it cannot control.

Pipeline Routes are Key to Accessing Oil and Gas Wealth from the Caspian Basin:

"Those who control the oil routes out of Central Asia will impact all future direction and quantities of flow and the distribution of revenues from new production," said energy expert James Dorian in Oil & Gas Journal on September 10, 2001.

The only existing export routes from the Caspian Basin lead through Russia. Investors in Caspian oil and gas are interested in building alternative pipelines to Turkey, Europe and Asia (6). Afghanistan occupies a strategic position between the Middle East, Central Asia and the Indian Subcontinent and lies squarely between Turkmenistan and the lucrative, desirable and growing markets of India, China and Japan.

U.S. oil companies have been negotiating with the post-Soviet republics of Kazakhstan and Turkmenistan for access to the Caspian Basin for years, but have made no progress because of the political instability in the region (7). The United States, Russia and US oil companies are currently struggling with each other to lay down pipeline routes that leverage control of the flow of oil and favor political and profit interests.

"Afghanistan's significance from an energy standpoint stems from its geographic position as a potential transit route for oil and natural gas exports from Central Asia to the Arabian Sea. This potential includes proposed multi-billion dollar oil and gas export pipelines through Afghanistan..." said a US government Energy Information fact sheet in September 2000.

In 1996, a Unocal-led consortium won a contract to build a 1,005 mile oil pipeline and a companion 918-mile natural gas-pipeline, in addition to a tanker-loading terminal in Pakistan's Arabian Sea port of Gwadan. Annual projected income of the project was US2$ billion which in five years would have paid for its costs. The US government and the Unocal consortium feared that they could not build a pipeline as long as Afghanistan, which had been battered by war since the Soviet withdrawal in 1989, was unstable. In 1998, Unocal shelved the project just after the US cruise missile strike against Bin Laden's Afghan camps (8).

The Bush-Cheney Oiligarchy has Long Represented Oil Interests in the Caspian Region:

"Because of the instability in the Persian Gulf, Cheney and his fellow oilmen have zeroed in on the world's other major source of oil - the Caspian Sea. Its rich oil and gas resources are estimated to be worth US$4 trillion by US News and World Report. The Washington-based American Petroleum Institute, voice of the major US oil companies, called the Caspian region, ‘the area of greatest resource potential outside of the Middle East,' according to Marjorie Cohn, a professor at Thomas Jefferson School of Law in the Chicago Tribune, August 2000.

Six US oil giants -- Unocal, Total, Chevron, Pennzoil, Amoco and Exxon -- have invested heavily in the massive oilfield potential in Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. The region's untapped oil reserves are estimated to be worth up to $2,000 billion. (9)

The one serious drawback companies have faced is getting the supplies to the right market, the energy-hungry Asian Pacific economies. Afghanistan -- the only Central Asian country with very little oil -- is by far the best route to transport the oil to Asia.

Enron, the biggest contributor to the Bush-Cheney campaign of 2000, conducted the feasibility study for a US$2.5 billion trans-Caspian gas pipeline which is being built under a joint venture agreement signed in February 1999 between Turkmenistan, Bechtel and General Electric Capital Services.

In 1994, Cheney as CEO of Halliburton, a multi-billion oil and gas services company, helped to broker a deal between Chevron (now ChevronTexaco) and the state of Kazakhstan when he sat on the country's Oil Advisory Board. (10)

On behalf of oil companies, an array of former cabinet members from the Bush Sr. administration have been actively involved in negotiations with Turkmenistan, Kazakhstan, Azerbaijan and Uzbekistan. They include former secretary of state James Baker, Brent Scowcroft, former national security advisor, John Sununu, former chief of staff and Dick Cheney, former secretary of defense and now Vice President. (11)

Everyone who has Oil and Gas Interests in Central Asia Needs Stability in Afghanistan:

As one Russian newspaper described it, "Russia's worries are not hard to understand. They have to do with postwar arrangements in Afghanistan. Economic interests are paramount. urkmenistan and Uzbekistan need stability in Afghanistan so that they can transit their oil/gas independently." Russia has completed talks with the Tajiks on how to share gas revenues after the war is over. They're estimating it will take six years to achieve stability. (12)

SOURCES: 1. "The big game gets bigger Russia will gain wealth and influence if it controls Caspian Sea oil," by Mortimer B. Zuckerman, U.S. News and World Report, May 10, 1994. 2. "Oil, gas in FSU Central Asia, northwestern China," by James P. Dorian, Oil & Gas Journal, September 10, 2001;  3. "The big game gets bigger Russia will gain wealth and influence if it controls Caspian Sea oil," by Mortimer B. Zuckerman, U.S. News and World Report, May 10, 1994; 4. "Fears Again of Oil Supplies at Risk," by Neela Banerjee, New York Times, October 14, 2001; 5. World Petroleum Consumption, 1990-1999, Energy Information Administration/International Energy Annual 1999; 6.ibid; 7.Oil Omissions, Bush Sr., Cheney Have Big Stakes in Saudi Status Quo,, October 18, 2001; 8. ibif; 9. "Prospect of oil riches speeds the wheels of war," by Barry O'Kelly, Sunday Business Post, Ireland, October 28, 2001; 10. Oil Omissions, Bush Sr., Cheney Have Big Stakes in Saudi Status Quo,, October 18, 2001; 11. "Scramble for the Caspian; Big Oil Looks to Divvy Caspian Sea Oil Riches," by Pratap Chaterjee, Multinational Monitor, September 1998; 12. "The God of Fossil Fuels," by James Ridgeway, The Village Voice, October 16, 2001.


Copyright   .  2002. Reprinted for fair use only

The URL of this article is: