WTC attack, Caspian oil and the Afghan pipeline connection

[Posted to the Marxism list by Jon Flanders, a trade unionist in the 
Albany area.]

The World Trade Center attack.....Caspian Oil and Gas and the 
Afghanistan Pipeline Connection

By Jon Flanders

In the sound and fury of media coverage following the World Trade 
Center attack, I have yet to see any serious examination of the 
economic forces working behind the scenes in the Middle East and 
specifically South Asia and Afghanistan. This in the United States, 
where every up and down of the stock market makes headlines every 
day, and we have TV channels devoted exclusively to economic 
activity.

Most of us know that the Middle East is a center of activity for 
world oil production. Some of us have heard about the Caspian Sea, 
and the touted possibilities for great oil resources there. But few 
would think that rocky, war torn Afghanistan might be part of this 
energy production picture.Yet it most certainly is. And the 
information about Afghanistan's role is readily available on the 
World Wide Web to anyone who wants to investigate. Indeed, much of 
the information comes from US government sources like the Voice of 
America. 

Michael Klare, author of the book "Resource Wars", which has a major 
focus on the Caspian region, was interviewed by Radio Free Europe / 
Radio Liberty, Inc.,http://www.rferl.org on May 28, 2001. Klare is 
the Director of the Five College Program in Peace and World Security 
Studies based at Hampshire College in Amherst, Massachusetts. In his 
book, Klare argues that it is not only the United States that is 
preparing for resource conflicts. He contends that all regional 
powers are focusing increasingly on how to protect or enlarge their 
access to vital resources over the next generation. 

Klare tells RFE/RL that vast energy reserves in Central Asia and the 
Caucasus have made the region a priority for the United States 
despite the area's generally poor progress in post-communist reforms. 
"I think in this case this is a national security consideration 
that's driving all of this. The United States has to get that oil 
from that region [Central Asia] and will make a deal with whatever 
governments are there in place that are willing to work with us [that 
is, the US], like the government[s] in Azerbaijan and Kazakhstan and 
Turkmenistan that are far from ideal with respect to human rights and 
democratic procedure. And I think that's a reflection of the view 
that I write about in my book -- we [the US] view oil as a security 
consideration and we have to protect it by any means necessary, 
regardless of other considerations, other values." I will argue that 
the current US government focus on Afghanistan is part of the oil 
security consideration. The following is my attempt to make sense of 
the Afghan energy connection.

The US government Energy Information fact sheet on Afghanistan dated 
December 2000 says that.."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, although these 
plans have now been thrown into serious question........"

These pipelines would begin in the former Soviet Republic of 
Turkemenistan, which may have one of the largest gas deposits in the 
world. The Washington Post reported in a 1998 article that "In August 
1997, in a bold move that conjured up memories of 19th-century 
Turkmen khans staving off would-be Russian conquerors, President(of 
Turkemenistan) Saparmurad Niyazov halted gas deliveries to the 
Russian-controlled pipeline system that was built during the Soviet 
era."

The Post goes on to say that " Turkmenistan's potential was enormous. 
Just inland from the Caspian shore were some of the world's oldest 
oil fields, and Soviet-era geological surveys indicated that the 
prospect for offshore finds was good. In the trackless Garagum 
Desert, away from a thin line of irrigated valleys, geologists had 
discovered one gas field after another beginning in the 1960s. By 
1990, Dauletabad and the adjoining Sovietabad field were producing 
1.6 trillion cubic feet a year, rivaling the gigantic gas fields of 
Siberia. 

Almost all of this gas was pumped north across Uzbekistan and 
Kazakhstan into a Russian pipeline and on to markets in Europe and 
the former Soviet republics. Niyazov said he "smelled old Soviet 
ambitions" in Russia's use of its pipeline monopoly to keep 
Turkmenistan's gas from competing with Russian gas in European 
markets."

Advising Niayzov during the early nineties? None other than former 
NATO commander and US Secretary of State Alexander Haig. In 1993 Haig 
actually formed a consortium to build a pipeline from Turkmenistan 
through Iran. Haig's project did not involve U.S. companies; Haig's 
pipeline enterprise was registered in the British Virgin Islands. The 
idea foundered on the opposition of the Clinton administration. But 
the idea of new routes for the Turkemenistan oil and gas did not end 
with the Haig plan. In an article dated 11/25/97, Voice of America 
reporter Joan Beecher writes that top government officials and oil 
company executives from the United States, Turkey, Great Britain, 
Russia, Azerbaijan, and Central Asia met to discuss an issue of great 
mutual concern: Pipeline routes for Caspian oil and gas.

The Washington Post in 1998 reported that "The initial enthusiast for 
the Afghan route was not an American, however, but Carlos Bulgheroni, 
the short, workaholic chairman of the Bridas Group, an Argentine 
company. In 1993, a Bridas joint venture with Turkmenistan had begun 
laying more than 2,000 miles of seismic lines to map the geology of a 
potential gas field in eastern Turkmenistan. Two test wells confirmed 
a huge gas deposit 150 miles from the Afghan border. 

In the spring of 1995, Turkmenistan and Pakistan commissioned 
Bulgheroni's company to study the Afghan route. But that summer, a 
rival entered the game. John Imle, president of California-based 
Unocal Corp., wooed Niyazov and Benazir Bhutto, then prime minister 
of Pakistan, throughout July with a vision of a Unocal pipeline 
following roughly the same route as the one proposed by Bridas."

By early 1998 a Unocal led consortium had made a deal with the 
Taliban to construct an Afghanistan pipeline from Turkmenistan to 
Pakistan.

On the question of the Afghanistan route VOA's Beecher says 
that........ "the most obvious drawback of a proposed pipeline from 
Turkmenistan, through Afghanistan, to Pakistan and down to the 
Arabian Sea is that there is still a civil war going on in 
Afghanistan. 

Nevertheless, all factions in the civil war have signed agreements 
supporting the proposed pipeline, according to Bob Todor, executive 
vice president of Unocal, the company that is leading an 
international consortium to construct the central Asian pipeline 
through Afghanistan. 

Speaking to the international conference, Mr. Todor argued that the 
basic problem with the existing and proposed western routes, across 
northern Russia, or to ports on the Black Sea, or under the Caspian 
and down to Turkey, is that they all lead to European markets: 

"Western Europe is a tough market. It is characterized by high prices 
for oil products, an aging population, and increasing competition 
from natural gas. Furthermore, the region is fiercely competitive. It 
is now being serviced by fields of course in the Middle East, the 
North Sea, Scandinavia, and Russia... Although there is room for 
Central Asia's oil, on the whole, it [western Europe] is not a very 
attractive market, because substantial infrastructure will have to be 
developed to bring that oil from the Caspian to the Western European 
market, and that market is very competitive." 

Much the same is true of Eastern Europe and the countries of the 
former Soviet Union, according to Mr. Todor. But Asia is a completely 
different story. Many speakers, not just Mr. Todor, argued that Asia 
will be the fastest growing market for Caspian oil, even if the 
region's present financial crisis should lead to a prolonged economic 
slowdown. Three routes to Asian markets have been proposed: Through 
China, through Iran, and through Afghanistan to Pakistan. In Mr. 
Todor's view, the proposed China route is too long, and will probably 
prove to be prohibitively expensive. The major argument against the 
Iran route is, quite simply, that the US government opposes it. Among 
the many advantages of the Afghanistan route, according to Mr. Todor, 
is that it would terminate in the Arabian Sea, which is much closer 
than the Persian Gulf or northern China to key Asian markets: 

"There is tremendous international and regional political will behind 
the pipeline. The pipeline is beneficial to Central Asian countries 
because it would allow them to sell their oil in expanding and highly 
prospective Asian markets. The pipeline is beneficial to Afghanistan, 
which would receive revenues from transport tariffs.... On a regional 
level, the pipeline will promote stability and encourage trade and 
economic development between South Asia and Central Asia. Finally, 
because of the combination of short pipeline distance and the 
relatively low cost of tankerage, this southern route will result in 
the most competitive export route to the Asia/ Pacific market." Yet 
construction of this promising route can only begin if and when an 
internationally recognized government is formed in 
Afghanistan......."

Todor's arguement for the Afghanistan pipeline was also made before 
the US Congress in 1998, by John J. Maresca, Vice President, 
International Relations of the Unocal Corporation in testimony to the 
House Subcommittee on Asia and the Pacific, February 12, 1998. 

Maresca concluded his Congressional testimony with this peroration. 
"Developing cost-effective, profitable and efficient export routes 
for Central Asia resources is a formidable, but not impossible, task. 
It has been accomplished before. A commercial corridor, a "new" Silk 
Road, can link the Central Asia supply with the demand -- once again 
making Central Asia the crossroads between Europe and Asia."

The Unocal led Centgas consortium consisted of the following 
companies.

Unocal Corporation (US), 46.5 percent Delta Oil Company Limited 
(Saudi Arabia), 15 percent The Government of Turkmenistan, 7 percent 
Indonesia Petroleum, LTD. (INPEX) (Japan), 6.5 percent ITOCHU Oil 
Exploration Co., Ltd. (CIECO) (Japan), 6.5 percent Hyundai 
Engineering & Construction Co., Ltd. (Korea), 5 percent The Crescent 
Group (Pakistan), 3.5 percent

The 48-inch diameter pipeline was to extend 790 miles (1,271 
kilometers) from the Afghanistan-Turkmenistan border, generally 
follow the Herat-to-Kandahar Road through Afghanistan, cross the 
Pakistan border in the vicinity of Quetta, and terminate in Multan, 
Pakistan, where it would tie into an existing pipeline system. 
Turkmenistan was to construct a pipeline that will link with the 
CentGas line at the border and stretch approximately 105 miles (169 
kilometers) to the Dauletabad Field. A potential 400-mile 
(644-kilometer) extension from Multan to New Delhi also was under 
consideration. (source, Hazara.net)

The Unocal-led initiative foundered in 1998, after the US cruise 
missile retaliation against Bin Laden's Afghan camps for the bombings 
of its African embassies. Brown University's William O. Beeman wrote 
in 1998 that ... " From the US standpoint, the only way to deny Iran 
everything is for the anti-Iranian Taliban to win in Afghanistan and 
to agree to the pipeline through their territory. The Pakistanis, who 
would also benefit from this arrangement, are willing to defy the 
Iranians for a share of the pot." 

Beeman continues, "Enter Osama bin Laden, a sworn enemy of the United 
States living in Afghanistan. His forces could see that the Taliban 
would eventually end up in the American camp if things proceeded as 
they had been. His(Bin Laden) bombing of US embassies in East Africa 
(since there were none in Afghanistan) was accompanied by a message 
for Americans to get out of ``Islamic countries.'' By this, he meant 
specifically Afghanistan.The American response was to bomb bin 
Laden's outposts while carefully noting that his forces were ``not 
supported by any state.'' This latter statement was an attempt to 
rescue the Taliban relationship, while at the same time giving the 
Taliban leaders the message that they must ditch bin Laden. For good 
measure, American missiles also took out a factory in Sudan - a 
smokescreen for the real target of their action...."(William O. 
Beeman is a Brown University anthropologist specializing in the 
Middle East. The piece first ran in The Providence Journal and was 
distributed by Knight Ridder/Tribune Information Services. Aug 1998.)

At the same time Unocal came under fire from international women's 
organizations for its courting of the Taliban, despite their 
notorious repression of women's rights. The women's rights issue, 
more than the embassy bombings, were used as an excuse to end the 
Unocal led consortium's deal with the Taliban. UNOCAL had entered a 
one million dollar contract with the University of Nebraska to train 
workers in Afghanistan specifically for pipeline construction. 
Women's organizations focused on this arrangement for protests.

Unocal's defection did not end pipeline plans. According to the VOA's 
Sarah Horner "But the pipeline dreams have surfaced again. In May 
2000 there were reports of discussions of the issue involving 
Afghanistan, India, Pakistan, Iran and Turkmenistan. And the Taliban 
newspaper, the Kabul Times, recently reported that the mine and 
industries minister, Mullah Mohammed Isa Akhond, met representatives 
of the Central Asia-based US company, Central Asia Oil and Gas 
Industry. The newspaper quoted company representative, Rafiq Yadgar 
as saying: "Central Asia Oil and Gas Industry is ready to invest in 
Afghanistan in the field of oil and gas extraction and meanwhile is 
willing to build an gas and oil refinery in Afghanistan." He added 
that Turkmen authorities are ready to cooperate with his company."

But any plans still ran afoul of the civil war in Afghanistan. 
According to Horner, "Should any pipeline actually get off the ground 
it will be a prime target for sabotage the United Front whose leader, 
Ahmad Shah Massoud, excels at guerrilla tactics." A few days before 
the WTC attack, Massoud was killed by suicide bombers posing as 
journalists.

So as matters stood before the "election" of George W. Bush, plans 
for Afghanistan's role in world energy production were at an impasse. 
As most of us know, the Bush-Cheney team that took control of the US 
Government in January, 2001, was heavily influenced by the oil 
industry. Bush himself is a veteran of a number of mostly failed oil 
enterprises. Cheney was the CEO of Halliburton, a major player in the 
downstream oil industry.

Cheney described Halliburton's role in a 1998 speech at the aptly 
named "Collateral Damage Conference" of the Cato Institute, a 
conservative Washington think tank. According to Cato "This all-day 
conference explored the current and potential conflicts between US 
foreign policy and the liberty and well-being of American citizens. 
The conference focused on the ways that US foreign policy infringes 
on the freedom of Americans to trade, invest and communicate with the 
rest of the world."

Cheney said in his speech that "Halliburton was founded some 70 years 
ago in Duncan, Oklahoma, by one man and a truck, cementing oil wells 
and casings inside oil wells. Over the years we developed the 
capacity to do everything downhole that is necessary to produce oil 
and gas: we drill wells, we do completions on wells, we cement, we 
stimulate, and we undertake a host of other activities involved in 
the production of oil and gas. We also own Brown & Root Engineering, 
a company that began about 70 years ago with two brothers with a road 
grader in Austin, Texas. Brown & Root is in the business of building 
off-shore platforms, undersea pipelines, refineries, and other 
down-stream facilities. Brown & Root is also heavily involved in the 
operations and maintenance business. They currently have the 
logistics contract for the U.S. Army in Bosnia under which they build 
and operate all the camps for the US Army deployed there. As a 
measure of the company's diversity, I should also mention that we are 
building the new baseball stadium in Houston. 

Halliburton employs about 70,000 people. We are currently a Fortune 
200 company, but are in the process of merging with Dresser 
Industries. Once we do that, part of Haliburton will not only include 
Brown & Root, but also M. W. Kellogg, one of the world's premiere 
engineering and design companies. In addition, Dresser also is 
heavily involved in manufacturing pumps, compressors, and all kinds 
of complex mechanical equipment that services the energy industry. 
Overall, once we complete the merger, we will have about 100,000 
employees. Our sales in 1999 should put us among the top 100 
companies in America in terms of revenue. We'll be the largest 
private employer in Texas and operate in over 130 countries all over 
the globe. About 70 to 75 percent of our business is energy related, 
serving customers like Unocal, Exxon, Shell, Chevron, and many other 
major oil companies around the world. As a result, we oftentimes find 
ourselves operating in some very difficult places. The good Lord 
didn't see fit to put oil and gas only where there are democratically 
elected regimes friendly to the United States. Occasionally we have 
to operate in places where, all things considered, one would not 
normally choose to go. But, we go where the business is."

Where the business is, indeed. In an article by Kenny Bruno and Jim 
Valette in Multinational Monitor magazine, dated May 2001 the authors 
report that "...During Cheney's tenure, Halliburton created or 
continued partnerships with some of the world's most notorious 
governments-in countries such as Azerbaijan, Indonesia, Iran, Iraq, 
Libya and Nigeria.

In order to do business with dictators and despots, Halliburton has 
skirted US sanctions and made considerable efforts to eliminate those 
sanctions. Halliburton's pattern of doing business with US enemies 
and dictators started before Dick Cheney joined the company, and may 
well continue after his tenure as CEO.

Halliburton's dealings in six countries -Azerbaijan, Indonesia, Iran, 
Iraq, Libya and Nigeria-show that the company's willingness to do 
business where human rights are not respected is a pattern that goes 
beyond its involvement in Burma:

* Azerbaijan. Dick Cheney lobbied to remove Congressional sanctions 
against aid to Azerbaijan, sanctions imposed because of concerns 
about ethnic cleansing. Cheney said the sanctions were the result 
only of groundless campaigning by the Armenian-American lobby. In 
1997, Halliburton subsidiary Brown & Root bid on a major Caspian 
project from the Azerbaijan International Operating Company.

* Indonesia. Halliburton had extensive investments and contracts in 
Suharto's Indonesia. One of its contracts was canceled by the 
post-Suharto government during a purging of corruptly awarded 
contracts. Indonesia Corruption Watch named Kellogg Brown & Root 
(Halliburton's engineering division) among 59 companies using 
collusive, corruptive and nepotistic practices in deals involving 
former President Suharto's family.

* Iran. Dick Cheney has lobbied against the Iran-Libya Sanctions Act. 
Even with the Act in place, Halliburton has continued to operate in 
Iran. It settled with the Department of Commerce in 1997, before 
Cheney became CEO, over allegations relating to Iran for $15,000, 
without admitting any wrongdoing.

* Iraq. Dick Cheney cites multilateral sanctions against Iraq as an 
example of sanctions he supports. Yet since the war, 
Halliburton-related companies helped to reconstruct Iraq's oil 
industry. In July 2000, the International Herald Tribune reported, 
"Dresser-Rand and Ingersoll-Dresser Pump Co., joint ventures that 
Halliburton has sold within the past year, have done work in Iraq on 
contracts for the reconstruction of Iraq's oil industry, under the 
United Nations' Oil for Food Program." A Halliburton spokesman 
acknowledged to the Tribune that the Dresser subsidiaries did sell 
oil-pumping equipment to Iraq via European agents.

* Libya. Before Cheney's arrival, Halliburton was deeply involved in 
Libya, earning $44.7 million there in 1993. After sanctions on Libya 
were imposed, earnings dropped to $12.4 million in 1994. Halliburton 
continued doing business in Libya throughout Cheney's tenure. One 
Member of Congress accused the company "of undermining American 
foreign policy to the full extent allowed by law."

* Nigeria. Local villagers have accused Halliburton of complicity in 
the shooting of a protester by Nigeria's Mobile Police Unit, playing 
a similar role to Shell and Chevron in the mobilization of this 'kill 
and go" unit to protect company property. Dick Cheney has been a 
strong advocate for preventing or eliminating federal laws that place 
limits on Halliburton's ability to do business in these countries."

The current hot spot for "where the business is" happens to be the 
Caspian. In a column dated Thursday, August 10, 2000 in the Chicago 
Tribune , Marjorie Cohn, a professor at Thomas Jefferson School of 
Law in San Diego writes.....

"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 at 
$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." Cheney told a gaggle of oil industry 
executives in 1998, "I can't think of a time when we've had a region 
emerge as suddenly to become as strategically significant as the 
Caspian." ..."

Halliburton's Caspian investments include Turkmenistan.

On October 27, 1997, the same time period in which the Unocal 
pipeline plan was in the works, a Halliburton press release announced 
that "Halliburton has received a Letter of Intent from Petronas 
Carigali (Turkmenistan) SDN. BHD. to provide integrated drilling 
services for an exploration and appraisal program in the Caspian Sea 
beginning in late 1997. Halliburton, in conjunction with alliance 
partners, Dresser Industries and Western Atlas, will provide a 
combination of 10 services. Halliburton will be the lead contractor 
and project manager in addition to providing technical services. The 
value of the award is estimated to be U.S. $30 million for the total 
project. "This major new award will expand and solidify the HES 
presence in the Eastern Caspian and position the company well for 
both upstream and downstream projects which are rapidly developing in 
this emerging market," said Zeke Zeringue, president, Halliburton 
Energy Services. Halliburton Energy Services has been providing a 
variety of services in Turkmenistan for the past five years."

P.V. Vivekanand, chief editor of The Gulf Today in the United Arab 
Emirates sums up the pipeline picture in the Caspian/Central Asia 
region in this way..."There are dozens of oil and gas pipeline 
projects in Central Asia, some estimated to cost billions of dollars 
and almost all sparking transborder disputes and controversies. Most 
of the projects have been discussed for decades as the oil giants 
wait for the right political conditions to move in. Because pipelines 
are the best method to transport oil and gas over land, the 
efficiency of such a delivery system is too tempting for energy 
exporters and importers to let go of plans in a hurry. And for many 
potential exporters and pipeline hosts, the realization of such 
projects can mean economic survival."

So where are we in the post WTC disaster period? The Bush-Cheney 
administration has taken full advantage of the shock and horror 
aroused in the US populace by this disastrous attack. On every front 
they are moving to implement a draconian conservative agenda. Whether 
passing anti-democratic domestic laws in the name of fighting 
terrorism, or to mobilizing the military to fight "terrorism" abroad, 
they move full speed ahead with their political program.

The focus on Afghanistan compels our notice. After all, the Middle 
East is full of people and governments that have no love for the US. 
The right wingers of William Buckley's National Review call for war 
to the finish against Iraq's Saddam Hussein. Others mention Iran.

But Bin Laden and the Taliban get the scapegoat's tail. Is this based 
on a real case, with hard evidence? Or is it simply because Bin Laden 
et al open the way for the full military might of the US armed forces 
to be committed to make the Caspian and Central Asian region safe for 
the US led oil and gas pipelines?

I think the evidence is overwhelming. The Bush administration plans 
to use the WTC attack as an opportunity to use the US military as 
pipeline police, with the current goal of splitting the government of 
Pakistan and the Taliban from the Islamic militants led by Bin Laden. 
If they can accomplish this, the way might be cleared for the 
Afghanistan pipeline project, and the basis for further penetration 
into the oil rich former Soviet republics established.

-- 
Louis Proyect, lnp3@panix.com on 10/06/2001

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