Kazakhstan has long indicated an interest in exporting oil and natural gas through the Caspian and the South Caucasus. It has, in fact, pledged to do so via the Baku-Tbilisi-Ceyhan pipeline. Follow-through has not been particularly great though. Almost all of Kazakhstan’s oil and natural gas is still exported through Russia. But Kazakhstan is talking investment in energy export projects with officials from Turkey, Georgia, and Azerbaijan. Kazakhstan has mentioned the possibility of building a refinery in Turkey, and just the other day in a meeting between Mikheil Saakashvili and Nursultan Nazarbayev, in Batumi. Another project under discussion is Kazakhstan’s involvement in a Baku-Tbilisi-Erzerum gas pipeline.
IWPR’s coverage contains the following:
“Kazakstan is not a leading producer of gas in Central Asia,” said political scientist Nikolai Kuzmin. “It does not sell large volumes [abroad], and all of it goes through Russia. A project to take Kazak gas to Europe via Turkey is not going to be relevant.”
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“This project has a clear anti-Russian colouring to it,” said Kuzmin. “It’s less about what makes sound economic sense than about political horse-trading, and Kazakstan has no direct interest in this.”
But that is kind of the point and exactly why it is in Kazakhstan’s interest. It is hard to say how interested Kazakhstan really is in exporting oil and gas through the Caucasus. It certainly seems like it wants to, but it is not rushing things. Kazakhstan’s energy industry relies on Russia’s pipeline system, but having alternatives gives it a better bargaining position and keeps Russia on better behavior.
Kazakhstan has come a long way, and among Central Asian states, it is the only one that can credibly explore large investments of this sort. Exporting through the Caucasus is not about the Kazakh government thumbing its nose at Russia politically at all. It is about pursuing its own interests and getting a fair price, which is something Russia understands.
This post was written by...
Nathan Hamm – author of 2974 posts on Registan.net.
Nathan is the Founding Editor and Publisher of Registan.net, which he launched in 2003. He was a Peace Corps Volunteer in Uzbekistan 2000-2001 and received his MA in Central Asian Studies from the University of Washington in 2007. Since 2007, he has worked full-time as an analyst, consulting with private and government clients on Central Asian affairs, specializing in how socio-cultural and political factors shape risks and opportunities and how organizations can adjust their strategic and operational plans to account for these variables. Nathan is currently seeking research, analysis, and consulting opportunities. He can be contacted via Twitter or email.
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