Global Research

A meeting to discuss the diversification of Europe’s energy supply in under way in Baku, the capital of Azerbaijan. Members of the GUAM Organisation for Democracy and Economic Development are in talks with several Baltic and Black sea countries as well as with global energy players. RT looks at the summit’s visitors and its agenda.

With Turkey, Poland, Ukraine, Lithuania, Estonia, Latvia, Romania, Bulgaria, the U.S., Kazakhstan, Turkmenistan, Georgia, and the EU being represented in Baku, it is easier to point out those who won’t be at the Baku Energy Security Summit: Russia.

This hardly comes as a surprise, as all the issues on the agenda are more or less related to reducing the reliance on Russia as an energy supplier, whose role is being reduced every year, according to experts.

Combating the reliance on Russia since 1918

Russia’s monopoly on energy supplies to Europe has long been a concern for the latter, and seeking to diversify its sources of hydrocarbons, Europeans have set their sights on the Caspian countries.

It is known that the late British Empire made a desperate attempt to gain control over the region by invading Baku during the Civil War in the Soviet Union as early as 1918, and since then Caspian oil hasn’t become less popular.

With proven oil reserves in the Caspian Basin (belonging to Azerbaijan, Russia, Kazakhstan, and Turkmenistan) comparable in size to the North Sea’s, it is the sole source of oil available in the region apart from Russia.

The biggest obstacle preventing the delivery of Caspian oil to European consumers is transportation. Since the 1960s Russia has had major pipelines connecting it with Europe through Ukraine, while the first non-Russian pipeline transferring oil from the Caspian Basin – the 1,768-kilometre-long Baku-Tbilisi-Ceyhan – started operating in May 2005.

Of course passing through countries with many frozen conflicts, it’s hardly the most reliable route in the world. A major blast in Turkey’s Erzincan Province, attributed to the Kurdistan Workers Party, disrupted it for 19 days in August 2008.

And even while intact, the Baku-Tbilisi-Ceyhan supplies only 1 per cent of global demand, so the energy supply to Europe still remains a major work area for some former Soviet countries.

Eleven-year-old organisation becomes useful at last

Energy issues gave purpose to the GUAM Organization for Democracy and Economic Development, an organization formed in 1997 by four former Soviet republics – Georgia, Ukraine, Azerbaijan and Moldova.

It was created with a broad list of functions to combat Russian influence in the region, but remained largely unused, before the Orange Revolution in Ukraine and Mikhail Saakshvili’s coming to power in Georgia.

After that GUAM intensified its cooperation within eight working groups: power engineering, transport, trade and economics, information and telecommunications, culture, science and education, tourism, fighting terrorism, organized crime and dissemination of drugs.

However, energy has been, is and will remain the main area of cooperation and the driving force of the organisation. GUAM members became the key participants of the pro-Western energy summits held in Krakow in May 2007, in Vilnius in October 2007 and in Kiev in May 2008.

Two-day Baku Energy Summit is the fourth.

Key transportation corridor to be discussed

The main agenda of the summit includes:

– re-exportation of Turkmen and Kazakh oil and gas resources to Europe, bypassing Russia through Azerbaijan;
– sustainability of energy sources and routes;
– safety and protection of hydrocarbon pipelines;
– acceleration of energy projects.

A big topic at the summit will be the Euro-Asian Oil Transportation Corridor, which is basically an enlarged version of the project to extend the Odessa-Brody oil pipeline from Ukraine to Poland.

Completed in 2001 up to Brody near the Polish border, that pipeline remained empty for three years as Russia chose to sell its own oil, instead of transferring Kazakh oil to Odessa. In 2004, Russian oil companies began to transfer oil from Brody to Odessa.

However, Ukraine still looks to extend this pipeline so that it can carry Azerbaijani oil arriving from the Georgian port of Supsa to Odessa and then take it to the Polish refinery at Plock and potentially to the port of Gdansk.

Some 500 kilometres of pipeline have to be built for that to happen.

The Nabucco pipeline will be discussed as well.

Members come, members go

Of course geopolitical issues are never far away from energy.

Internal problems that exist in each of the GUAM countries remain obstacles to an efficient integration process.

Ukraine’s Crimea has a Russian population of 70 per cent, and faces additional problems with Crimean Tatars who seek the establishment of a national autonomy.

Azerbaijan is still short of solutions on the Nagorno-Karabakh issue, and doesn’t have control over several areas near it.

In Moldova, the situation of the breakaway Transdniester region remains unresolved – 16 years after it started. Russian peacekeeping forces have been stationed there.

Any shift in the world’s geopolitical balance (like the recognition of Kosovo, Abkhazia and South Ossetia) is destined to have a big impact on GUAM. Its failure to accomplish anything significant has already lost it some members. But it continues to gain new ones.

In 1999, the organisation was renamed GUUAM due to the membership of Uzbekistan, who signed its charter in 2001 only to withdraw in 2005, after the country’s President, Islam Karimov, failed to attend the summit in Chisinau, Moldova.

A similar situation is now on the cards with Moldova’s president, Vladimir Voronin, who failed to show up at GUAM summits for two years in a row and is absent at Baku too.

Meanwhile, GUAM also looks for new members, after giving Turkey and Latvia a permanent observer status in 2005. After Kazakhstan and Turkmenistan reacted on the idea of joining GUAM without enthusiasm, the organisation turned their sight on countries in Eastern Europe.

That’s why Bulgaria’s President, Angel Marin, Lithuania’s Valdas Adamkus, Poland’s Lech Kaczynski, Romania’s Traian Basescu, Latvia’s Valdis Zatlers, Turkey’s Abdullah Gul, as well as Estonia’s Prime-Minister, Andrus Ansip, Hungaria’s Ferenc Gyurcsany, Greece Development Minister, Christos Folias and top energy officials from Kazakhstan and Turkmenistan are all at the energy summit discussing their roles in the development of alternative energy routes.

U.S. Energy Minister Samuel Bodman is there too to encourage them, while his EU counterpartj, Andris Piebalgs, who left Baku just days ago, is back again to stress the importance of the Nabucco pipeline project.