Caspian Sea

1
Caspian Sea

• November 29, 2007
• Diana Dukart

2
Agenda

• Background
• 5 Littoral States
• Area Concerns
• Wealth
• Gini Coefficient
• Corruption Index
• Pipelines
• Solutions
• Examples

3
Caspian Sea Background

• Largest Enclosed Body of Water
• Sea versus Lake Status
• Endorheic
• Natural Resources
• Oil and Natural Gas
• Sturgeon

4
Five Littoral States

• Littoral Coast of an ocean or sea.

5
Azerbaijan

• Capital Baku
• Population 8.6 Million (June 07)
• Religion 94 - 96 Muslim (70 Shia, 30 Sunni)
• Demographic 96 Azeris, 3 Russian
• GDP 91 Billion (2006)
• Per Capita 7,500 
• Economy Energy Based
• 1994 State Oil Company of Azerbaijan Republic
  (SOCAR) signed 30 year contract with 13 oil
  companies (includes Amoco, BP, Exxon, LUKoil, and
  Statoil).
• State Oil Fund of the Republic of Azerbaijan
  (SOFAZ) established in 2000 to manage the oil
  revenue and safeguard resources for future
  generations.

Ilham Aliyev President
6
Iran

• Capital Tehran
• Population 70.5 Million (2006)
• Religion 98 Muslim (92 Shia and 8 Sunni)
• Demographic 51 Persians, 24 Azeris, 8 Gilaki
  and Mazandarani, 7 Kurds
• GDP 610 Billion (2006)
• Per Capita 8,700 
• Economy
• 2nd largest Natural Gas Reserve, 3rd largest Oil
  Reserve
• Investing in Automobile Manufacturing, Aerospace,
  Electronics, Petrochemicals, and Nuclear
  technology

Mahmoud Ahmadinejad President
7
Kazakhstan

• Capital Astana
• Population 15.2 Million (2006)
• Religion 54 Muslim, 12 Baptist, 11 Newly
  Founded, 8 Russian Orthodox
• Demographic 63 Kazakhs, 23 Russian
• GDP 145.5 Billion (2007)
• Per Capita 9,594 
• Economy Energy Based
• Oil Exports 24 of GDP in 2003
• Agriculture 14 of GDP in 2003

Nursultan Nazarbayev President
8
Russia

• Capital Moscow
• Population 143 Million (2006)
• Religion 63 Russian Orthodox, 24 - 48
  Non-Believers. Muslim is the largest religious
  minority.
• Demographic 80 Russian, 4 Tatar, 2 Ukrainian
• GDP 1.7 Trillion (2006)
• Per Capita 12,096
• Economy Not Energy Based
• Oil and Gas 5.7 of GDP
• Largest Natural Gas reserve, 2nd largest coal
  reserve, and 8th largest oil reserve
• Strong Internal Market
• 2006 marked 8th straight year of growth,
  averaging 6.7 annually
• Average salary increase 540/month August 2007
  vs. 65/month August 1999

Vladimir Putin President
9
Turkmenistan

• Capital Ashgabat
• Population 5 Million (2006)
• Religion 89 Muslim, 9 Eastern Orthodox
• Demographic 85 Turkmen, 5 Uzbek, 4 Russian
• GDP 45 Billion (2006)
• Per Capita 8,900
• Economy
• 10th largest Cotton producer
• 5th largest Natural Gas Reserve
• Two-Thirds goes through Gazprom
• 2006 raised price from 65 to 100 per 1,000
  cubic meters
• 2004 Unemployment Rate Estimated 60
• Widespread Internal Poverty
• High Foreign Debt (2001 Est 2.4B - 5B)
• Resources are not Nationalized
• Currency Reserves are held in Off-Budget Funds in
  the Deutsche Bank in Frankfurt

Gurbanguly Berdimuhammedow President
10
Three Current Concerns

• Natural Resources
• Oil and Natural Gas
• Fishing
• Sturgeon Population and Caviar Exports
• Water Access
• Export Access and International Travel

11
Wealth

• 161 Billion Barrels of Oil
• 15 Trillion or 3 Trillion per State

12
Wealth

• 9.3 Trillion Cubic Meters of Natural Gas
• 2.4 Trillion or 480 Billion per State

13
GINI Coefficient
14
GINI Coefficient
15
Corruption Perceptions Index

• CPI Order Countries by Perceived Corruption
  Among Public Officials and Politicians
• Higher is Perceived Less Corruption (Scale 0-10)

16
Corruption Perceptions Index

• Least Corrupt
• Denmark 9.4
• Finland 9.4
• New Zealand 9.4
• Singapore 9.3
• Sweden 9.3
• Iceland 9.2
• Netherlands 9.0
• Switzerland 9.0
• Canada 8.7
• Norway 8.7
• Australia 8.6
• Luxembourg 8.4
• United Kingdom 8.4
• 20. United States 7.2

• Most Corrupt
• Myanmar 1.4
• Somalia 1.4
• Iraq 1.5
• Haiti 1.6
• Tonga 1.7
• Uzbekistan 1.7
• Afghanistan 1.8
• Chad 1.8
• Sudan 1.8
• Democratic Republic of Congo 1.9
• Equatorial Guinea 1.9
• Guinea 1.9
• Laos 1.9

17
Oil Pipelines

• Existing Pipelines
• Pipelines in Process
• Proposed Pipelines

18
Existing Pipelines

• Alashankou-Dushanzi Pipeline
• Baku-Tbilisi-Ceyhan Pipeline
• Druzhba Pipeline
• Trans-Israel Pipeline

19
Pipelines in Process

• Caspian Pipeline Consortium
• Kazakhstan-China Pipeline

20
Proposed Pipelines

• Afghanistan Oil Pipeline
• Trans-Caspian Pipeline
• AMBO Pipeline
• Burgas-Alexandroupoli Pipeline
• Pan-European Pipeline
• Odessa-Brody Pipeline
• Samsun-Ceyhan Pipeline

21
Alashankou-Dushanzi Pipeline

• Existing Pipeline
• From Xinjiang Region in China To Kazakhstan-China
  Pipeline
• Currently Under Construction
• Operated by CNPC (China)

22
Baku-Tbilisi-Ceyhan Pipeline

• Existing Pipeline from Azerbaijan to
  Mediterranean Sea in Turkey
• Owned by a consortium led by BP

23
Druzhba Pipeline

• Existing Pipeline from Western Russia to Europe
• Operated by Transneft (Russia)

24
Trans-Israel Pipeline

• Existing Pipeline Connects the Red Sea to the
  Mediterranean Sea through Israel
• Was Joint Ownership of Israel and Iran
• After Iranian Revolution, Controlled Solely by
  Israel

25
Caspian Pipeline Consortium

• Currently In Process
• From Kazakhstan to Black Sea
• Consortium led by Russian, Kazakhstan, and Oman
  Governments

26
Kazakhstan-China Pipeline

• Direct pipeline from Kazakhstan to China
• Under Construction
• Needs Oil from Russia to Run at Capacity

27
Afghanistan Oil Pipeline

• Proposed by US
• One Reason for Afghanistan Invasion
• Unstable Afghanistan Environment Postponed Project

28
Trans-Caspian Pipeline

• Proposed to run from Kazakhstan to Azerbaijan
• Meet up with the BTC pipeline
• Total Oil Company Interest (France)
• Russia and Iran have alternate routes

29
Bypass Turkish Straits

• Bypass the Bosporus and Dardanelles Straits
• 5 Proposed Pipelines

30
Bypass Turkish Straits
31
Solutions

• October 16, 2007 2nd Summit of the Heads of the
  Caspian States are meeting in Tehran

32
Solutions

• CITES - Convention of International Trade in
  Endangered Species of Wild Fauna and Flora

• International Agreement between Governments
• First Formed 1960s
• Administered by UN Environment Program
• 172 Members
• Iran 1976
• Russia 1992
• Azerbaijan 1999
• Kazakhstan 2000

33
Solutions

• Sturgeons and CITES
• Special Program Since 1998
• Regulate International Trade
• Use of Permits and Labeling
• 2006 Ban
• Only Iran was allowed to export
• Irans Sustainability Documentation was
  Acceptable to CITES
• 2007 Quota 15 Lower than Quota in 2005
• No Quota for Beluga
• Most Valuable Caviar
• Incomplete Documentation

34
Solutions

• CEP Caspian Environment Programme
• CEP's mission is to assist the Caspian littoral
  states to achieve the goal of environmentally
  sustainable development and management of the
  Caspian environment for the sake of long-term
  benefit for the Caspian inhabitants.

35
Solutions

• Reforest the land to gain Carbon Credits
• Kyoto Protocol / Emission Trading

36
Azerbaijan State Oil Fund

• Build Housing and Improve Socio-Economic
  Conditions for Refugees of Nagorno-Karabakh
  Conflict
• Finance BTC Pipeline Project
• Finance Oguz-Qabala-Baku Water Supply System
• Reconstruct Samur-Absheron Irrigation System

37
Bolivia President Evo Morales

• Nationalize Oil and Natural Gas
• Agrarian Evolution

38
Ecuador - President Rafael Correa

• Instituted 99 Windfall Tax for Foreign Oil
  Companies

39
Venezuela President Hugo Chavez

• Establishing Bank of the South
• Endorsed by Nobel Prize-Winning Economist Joseph
  Stiglitz

40
Questions?