TRANS-BALKAN PIPELINE FOR KAZAKHSTANI OIL CONSIDERED.

The United States government and several Balkan countries are taking under active consideration a proposal to transport Kazakhstani oil to Europe through a pipeline across Bulgaria, Macedonia and Albania. The proposed line would, in effect, extend the pipeline, which is already under construction, from Kazakhstan’s giant Tengiz oilfield to the Russian port Novorossiisk on the Black Sea. The Chevron and Mobil companies are the main interested parties in the Tengiz project. These two American companies are also involved, along with Russian and Western companies, in the Caspian Pipeline Consortium (CPC), which has begun laying the Tengiz-Novorossiisk pipeline. That line’s annual throughput capacity is projected at 28 million tons in the first stage and a huge 64 million tons in a follow-up stage.

The CPC’s pipeline project suffers from a number of inherent weaknesses, including the initial planning assumption that tankers loaded at Novorossiisk would use the Turkish Straits for shipping the oil out of the Black Sea to international markets. The Turkish government, however, has made it clear that it would not allow any additional tanker traffic through the already overcongested Bosporus. To some extent, Turkey’s position reflects its interest in routing Caspian oil through the proposed Baku-Ceyhan pipeline, as opposed to the Novorossiisk-Bosporus route. But few would deny that the Turkish Straits can not accommodate any more oil traffic without posing unacceptable ecological and safety risks to the Bosporus and the urban agglomeration of Constantinople.

That situation has led the Chevron-led CPC consortium to seek an alternative exit from the Black Sea. The option currently under consideration involves tanking Kazakhstani oil from Novorossiisk across the Black Sea to Bulgaria and piping it westwards to the Adriatic coast in Albania, whence the route can continue to Italy by tanker. Washington’s interest in this option has increased suddenly and exponentially in connection with its plans for economic reconstruction in the Balkans following the Kosovo conflict. The United States Trade and Development Agency has just allocated US$600,000 to a feasibility study of the trans-Balkan pipeline for Kazakhstani oil (Anatolia news agency, Turkish Daily News, June 18-19).

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