Tokayev looks to the Caspian Sea to diversify oil export routes – the diplomat

Asia crossroads | Economie | Middle Asia

Kazakhstan is once again looking at the possibility of constructing a Trans-Caspian pipeline, but will plans to diversify oil export routes only lead to linking the Kazakh economy with the doomed fossil fuel industry?

Kazakh President Kassym-Jomart Tokayev described diversification of oil export routes, in particular the Trans-Caspian option, as a “priority” in Government meeting on July 7. Although Tokayev did not directly mention Russia, these comments came days after a Russian court ordered Suspension of operations In Novorossiysk, the Russian port that handles the majority of Kazakh oil exports.

Although CPC has filed an appeal, which reportedly delayed the suspension of operations, the incident followed a number of turmoil in Novorossiysk in the past year, demonstrating just how turbulent Kazakhstan’s most lucrative industry is.

as such Paolo Sorbillo explained earlier this year“Currently, [CPC] It transports two thirds of Kazakhstan’s oil exports. This represents about 40 percent of Kazakhstan’s total exports.” It is a huge responsibility for such an important sector to depend on the foreign choke point. From Spills to me stormsThere are many risks that can disrupt operations before political impact is often taken into account, but they are difficult to measure.

Diversification may seem like the obvious answer, but the difficulties in achieving it are just as obvious. As a landlocked country, Kazakhstan depends on the territory of other countries to see its oil reach global markets, regardless of the direction of the oil flow. In addition to CPC, which transports oil from the Atyrau province of Kazakhstan through southern Russia, Kazakhstan can transport oil via Ozen Atyrawi Samara Pipeline to Russia and from there via the Russian pipeline network to the Baltic terminal at Ust-Luga or Novorossiysk on the Black Sea. Then there is the pipeline network between Kazakhstan and China. Kazakhstan ships too Oil via rail and tankers across the Caspian Sea, but in much smaller quantities.

Trans-Caspian routes for both oil and gas have long been contemplated, but none have yet been realized.

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Luca Anchchi, a senior lecturer in Central Asian Studies at the University of Glasgow, told The Diplomat that Tokayev’s call for rapid diversification of export routes is an “unrealistic goal that can be reached in the short term.” “[P]ipelines are expensive energy infrastructures, which, to be built and brought into line, require lengthy rounds of negotiations with transport partners and, most importantly, buyers.”

Tokayev’s urging that the “priority direction” of oil diversification be the Trans-Caspian route is reviving the efforts of his predecessor Nursultan Nazarbayev to transport more oil across the Caspian Sea to Azerbaijan and then to Europe. in 2006Kazakhstan and Azerbaijan signed a framework agreement on the Trans-Caspian Oil Transportation System, although that left open details about whether the envisioned system would include a seabed pipeline or increased tanker transportation. by 2009State energy companies in both countries agreed to conduct further feasibility studies and During a visit by Nazarbayev to FranceThe then Kazakh president declared,Share the French side In the project of constructing the main oil export pipeline from the Caspian Sea to Baku and Europe.

More than a decade later, there is still a pipeline across the Caspian Sea. It is unclear whether Tokayev’s recent focus on diversifying oil export routes can actually move the process, but it is unlikely to be said.

More importantly, diversification of oil export routes is only crippling the Kazakh economy in an industry many see inevitably doomed, as climate change spurs a hoped-for global shift away from fossil fuels.

Anchisky warns that “the regime’s insistence on keeping the entire economic structure dependent on the energy sector will one day collide with the reality of the post-oil world.” “At this point, it is reasonable to expect a dramatic economic crisis: the leaders of the new Kazakhstan must prepare to mitigate the risks associated with this scenario, because the post-rental economy is not only more stable, but also – and perhaps crucially, given the social and economic grievances that It still arises from Kazakh society – a more just economy. ”

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