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rfmcdonaldThe business section of today's The Globe and Mail prominently features Mark MacKinnon's article about the oil of the Caspian Sea. After the collapse of the Soviet Union, many oil firms eagerly looked to the Caspian Sea area as a promising untapped area. The region of Baku in Azerbaijan was the historical centre of the Russian and Soviet oil industries, after all. If (as many argued) the littoral region hosted almost as much oil as Saudi Arabia. the potential for diversifying the developed world's sources of oil was vast. This idea excited many, even becoming the central feature of the script of a James Bond movie, the 1999 The World Is Not Enough.
The film was mildly controversial among fans for certain plot reasons. As it turns out, the movie was flawed for the much more fundamental reason that there isn't enough oil in the Caspian Sea to "see us through the next century."
It doesn't help matters any that the division of the Caspian Sea among the littoral states is hotly debated, or that Azerbaijan is one of the most corrupt countries in the world as ranked by Transparency International (read this report (PDF format) on corruption in the Azerbaijan oil industry for more), or that the pipeline running from Baku to the Turkish Mediterranean port of Ceyhan via Georgia has been criticized as uneconomical, or that much of the fuss seems to have been encouraged as much by the Clinton administration's desire to pull the South Caucasus out of the Russian orbit via investment as anything else. So much for all that.
ROBINSON: [. . .] Largest landlocked body of water on Earth. Oil-rich. Hitler wanted it. Stalin beat him to it.
M: And now it's up for grabs, a goldrush. Far more oil than anyone thought.
ROBINSON: Latest estimates, six trillion dollars. It'll make the Gulf look like a puddle, see us right through the new century. The problem is getting the oil out of there.
The film was mildly controversial among fans for certain plot reasons. As it turns out, the movie was flawed for the much more fundamental reason that there isn't enough oil in the Caspian Sea to "see us through the next century."
But just as the crude is finally starting to creep westward, it's becoming clear that there's much, much less oil than had been originally trumpeted. Instead of the 200 billion barrels predicted in 1995, most estimates now place the figure at somewhere between 17 and 32 billion, most of it on the other side of the Caspian from Azerbaijan, in the waters off Kazakhstan(B6).
It doesn't help matters any that the division of the Caspian Sea among the littoral states is hotly debated, or that Azerbaijan is one of the most corrupt countries in the world as ranked by Transparency International (read this report (PDF format) on corruption in the Azerbaijan oil industry for more), or that the pipeline running from Baku to the Turkish Mediterranean port of Ceyhan via Georgia has been criticized as uneconomical, or that much of the fuss seems to have been encouraged as much by the Clinton administration's desire to pull the South Caucasus out of the Russian orbit via investment as anything else. So much for all that.
