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Iraq: Winning the Unwinnable War
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First of all Zebo sorry to burst your bubble but I was and still am against the Iraq war. Thanks for the "neocon crazy" label though. I'll add it to my trophy collection of "religious nutcase" "liberal wuss" "far left nut job" "communist" "nazi" "Bush lover" "Bush fanboi" "Kerry lover" "kerry fanboi" "democrat" and "republican".
Just goes to show how much people's own biases cloud their perception of others.
Now, on to what I was saying.....my response, if you even bothered to read it, was how to deal with the situation NOW that we are there. Hindsight is 20/20, and if you sit around looking at your ass not much gets accomplished now does it?
BarneyFife
Diamond Member
When you increase the troops, you just increase the targets.
So why did the U.S. believe the fairy tale of Iraqis welcoming Americans as liberators instead of invaders? I don't know. This war was sold to us on many levels, none of them honest.
The OP doesn't suggest pulling out and risking a civil war or broader regional conflict.
The problem with the U.S. remaining in Iraq and attempting to force a military resolution is that by doing so we fuel the 'insurgency' which increases our military response which fuels the insurgency and on and on. There is no military solution in Iraq. The longer the U.S. stays there the more the conflict escalates.
It seems there are powerful people on either side who would welcome that scenario. That speech Zebo posted from President Adams captured it all. Is this the father or the son?
Intrigue, individual avarice, envy, ambition. There are fortunes at stake in Iraq. Fortunes in both money and power. The vacuum has been created and politicians, contractors, religious leaders, and ex-patriates are rushing in to fill it. Whoever controls the process will control the outcome. Iraqis should control the process but they can't as long as the U.S. occupation controls Iraq.
Getting U.S. troops out of Iraq is the first step in allowing an Iraqi state to develop. We may not like the way in which it develops but our only other option is to stay and force our idea of Iraq on Iraqis. That will never work.
The supposedly educated people who decided on this reckless course should have realized that if they had spent a single day studying human history. And, in addition, they all had Vietnam as an example.
Which leads me to ask, what was the true motive for this reckless, unprovoked aggression?
Hayabusa Rider
Admin Emeritus & Elite Member
And the ability to blend in. In a line up you couldn't pick them out.
Zebo
Elite Member
No I donate to the troops but I don't make a big deal about it. I also support them coming home to thier families, no being sold a bill of goods and fraudulant executive order draft/ unconsitutional slavery they are subjected to. Iraqis? fusk em. They will spiral out of control whether we leave now or 12 years from now. It's their nature. Freedom and democratic rights must come from self-realization not by way of gun or it's not accepted. The only question is do we want to spend 200B and probably 1000 troops dead another 10000 maimed each year for this childish excersise. Veitman is still recovering for the horror we unleashed on them do we really want to do the same to iraqis? We could control Iraq but Do we want to do what Saddam did to control his people? But then what would be the point of this whole excercise?
BBond, I think your tinfoil hat fell off dude.
First off, who should control the process? Iraqis right?
Which Iraqis? The sunnis? the Shiites? the Kurds? All three want control of the government. All three want control of the infrastructure improvement.
You have got to stop thinking Iraq is full of a homogenic culture like the US....it's not. There are three very distinct ethnic and religious groups, all positioning themselves for their own benefit.
If the Shiites gain control, the Sunnis will fight....why do you think they are protesting the elections? Because they stand to lose out in control of the new government to the Shiite majority. The Kurdish groups will protest BOTH the shiites and sunnis because the Kurds are an ethnic group, and the Shiites and Sunnis are Arabic.
Sure...turn the rebuilding effort over to Iraqis.....now you just have to tell me which Iraqis to turn them over to huh?
.....and if you think the insurgents in the Sunni triangle will stop with the pullout of the US, you are mistaken. Did the warlords in Somalia stop fighting when the US left? The insurgents will turn their attention on either the Kurds, who are a different ethnicity or the Shiites, who are their religious rivals and have ties with Iran. Insurgents/fighters know one thing only: fighting. Most are unskilled and poor single males....fighting is the only thing they know, and they will continute to do so.
First off, who should control the process? Iraqis right?
Which Iraqis? The sunnis? the Shiites? the Kurds? All three want control of the government. All three want control of the infrastructure improvement.
You have got to stop thinking Iraq is full of a homogenic culture like the US....it's not. There are three very distinct ethnic and religious groups, all positioning themselves for their own benefit.
If the Shiites gain control, the Sunnis will fight....why do you think they are protesting the elections? Because they stand to lose out in control of the new government to the Shiite majority. The Kurdish groups will protest BOTH the shiites and sunnis because the Kurds are an ethnic group, and the Shiites and Sunnis are Arabic.
Sure...turn the rebuilding effort over to Iraqis.....now you just have to tell me which Iraqis to turn them over to huh?
.....and if you think the insurgents in the Sunni triangle will stop with the pullout of the US, you are mistaken. Did the warlords in Somalia stop fighting when the US left? The insurgents will turn their attention on either the Kurds, who are a different ethnicity or the Shiites, who are their religious rivals and have ties with Iran. Insurgents/fighters know one thing only: fighting. Most are unskilled and poor single males....fighting is the only thing they know, and they will continute to do so.
Now this I will agee with you on, and is the reason why I am opposed to being there. However, we are there, and we have to do all we can to ensure a stable government is in place. As to the reasons why, read my post above.
Aside from that, if we pull out we create the possibility of another totalitarian government coming to power that will create another state-sanctioned haven for terrorist groups like the Taliban in Afghanistan.
The first item of yours that I quoted at present will create a Balkans situation. Once there is an Iraqi government, then we can pull out. Let the UN then determine if that government will then be pulling another Saddam. It is unlikely that such an extreme will happen there again.
The next item ws based on the "educated" people flawed perspective of human history reacting to the overflow of tyrants.
Rose colored glasses conceal the true colors.
No arguement here. The situation was not planned properly from the git go with the exception of the initial use of military force.
The motive was to remove a pain in the ass to the US, a supporter of terror and a dictator that thought that he could manipulate the world body for as long as it took to allow a non-hostile regime to forget about him.
Events & evidence have shown the above to be correct. The sales job was flawed, but the sale was made.
Those that have stated that we went in to control the Iraqi oil, have yet to provide proof.
There has never been a civil war in Iraq. I don't think civil war is a guaranteed thing unless encouraged by outside influences. The Sunnis, Shiites and Kurds have lived together peacefully before and could do so again. The tribal system is such that members of the same family can and do have Sunni and Shiite family members intermixed. If the political leaders, religious leaders and the tribal sheiks agree on a peaceful approach they can make it very difficult for rogue groups to operate.
The fly in the ointment now is that Pandora's box was opened.
The Sunnis have had a taste of power over the others and will be unlikely to want to not get it again.
The Shites were put down/slaughtered by the Sunnis and are not likely for forgive/forget.
Everyone realizes that oil generates wealth. Wealth generates power, and every one wants power.
Outside interests stirred up the mix and it is not going to settle as long as they are involved. That includes the demand for oil.
Hayabusa Rider
Admin Emeritus & Elite Member
So anyone wonder why this was not seriously thought of before the war? I used to, but came to the conclusion that it didn't really matter to this admin.
Eaglekeeper: "Those that have stated that we went in to control the Iraqi oil, have yet to provide proof."
GrGr: There has been a lot of "proof" posted here but none are so blind as those that refuse to see. Ignoring the geopolitical side of the equation is foolish; geopolitics is the main reason for the invasion of Iraq, not US philantropical urges. The geopolitical argument makes a whole lot more sense to me than all the 27+ rationalizations spewed by the Bush administration.
Pipelineistan
"There are also several projects to either truck or pipe energy through Georgian territory. Chevron has a strong interest in this option, along with Conoco. The US Trade and Development Agency funded a $750,000 feasibility study by Enron for a natural gas pipeline from Turkmenistan, through Azerbaijan and Georgia, to Turkey. Another feasibility study was completed by Unocal. There have been negotiating problems among the various countries, and PSO (co-operator with Royal Dutch/Shell) closed its Turkmenistan office in 2000. Talks about the project have resumed, but the legal issues of Caspian Sea ownership complicate the project. (http://www.eia.doe.gov/cabs/caspian.html )
Chevron?s involvement throughout the region is quite ubiquitous. Chevron has invested more than $20 billion in Khazakhstan alone. From 1989-92, Condolezza Rice was on the board of directors of Chevron, and was its main expert on Khazakhstan. (http://www.gasandoil.com/goc/features/fex20867.htm, source: Asia Times Online Co. Ltd)
...
As for the market, the big question has been: should the pipelines flow east or west? The western route would be easier, as much of the infrastructure is already in place. There are several projects underway or completed for bringing energy resources to the west. However, European oil demand over the next 10-15 years is expected to grow by only 1 million bbl/d, while Asian demand is expected to grow by at least 10 million bbl/d over the same period. Therefore, greater profit is seen in piping these resources to the east. Unfortunately, an eastward route would require the longest pipelines in the world. Formidable mountains would require long detours to the north, or a shorter route to the south through either Iran or Afghanistan and Pakistan. The Iranian route is prohibited under the Iran and Libya Sanctions Act. Therefore, Afghanistan and Pakistan are the choice for energy flowing eastward.
...
In July 2001, a strategy to topple the Taliban and replace it with a ?broad-based government,? was discussed during the G-8 summit in Genoa, Italy. (This subject was first broached in Geneva at a May 2001 meeting between the US State Department, Iran, Germany, and Italy.) Following within days of the G-8 summit, secret negotiations were conducted in a Berlin hotel between American, Russian, German and Pakistan officials. Pipelineistan was the central topic of these negotiations, and a plan was set up for military strikes against the Taliban from bases in Tajikistan, to be launched before mid-October 2001. (http://www.oilandgas.com/goc/features/fex20867.htm, source: Asia Times Online Co., Ltd.)
...
Caspian Oil Estimate Revised Down Early estimates of Caspian Sea Oil reserves ranged from 115 to 200 billion barrels. These estimates have been rightfully viewed with skepticism as they were based on a 10% probability of recovery?that is, they were considering oil which could not be recovered. Now this assessment has been severely downgraded by oil industry insiders.
Speaking on 8 April in Almaty at the Eurasian Economic Summit, Gian Maria Gros-Pietro, chairman of Italy's Eni oil company, said the Caspian contains 7.8 billion barrels of oil, the Interfax news agency reported. This is confirmed by Agip?s statement in Energy Day of May 30th that the recoverable reserve potential of Kashagan is only 1.2 billion barrels. With these revisions, it is questionable whether the Caspian Sea region will ever approach the importance of the Middle East with regard to energy reserves. (ASPO Newsletter #18, June 2002; http://www.isv.uu.se/iwood2002...letter/Newsletter.html ) Finally, we refer the reader to the following table of world energy reserves from the BP Review of World Energy 2002. Note that the Caspian Sea region is included in the Former Soviet Union, amounting to less than one tenth of Middle East reserves. In fact, added together, the rest of the world only contains 364.5 thousand million barrels in proven reserves, or 53% of the proven reserves of the Middle East. Source: BP Statistical Review of World Energy 2002; http://www.bp.com/centres/energy2002/index.asp
etc.
---------------
"World Peak oil "
It is in the Middle East that the real grab for world power will be played out. According to Duncan and Youngquist?s model, by 2007 the Middle East will dominate the world in oil production. This will be the last region where oil production will peak, according to Duncan and Youngquist?s model, sometime around 2011. And the oil of the Middle East lies largely in the provinces of five countries: Iran, Iraq, The United Arab Emirates, Kuwait, and Saudi Arabia.
...
All but two of these countries are closely tied to the United States and are likely to be players in the oil coup. The exceptions are Iraq and Iran. Iraq?s ability to export oil has been severely restricted since the first Gulf War. Likewise, Iran faced stiff embargoes following the fall of the Shah in the 1970?s. However, in neither of these countries does the oil coup have clear control over oil resources. Likewise, both countries are targeted as terrorist states. Right now, Israel and powers in the United States are lobbying strongly to make Iraq the next target in the ?War against Terrorism.? Rumor has it that this war is slated to begin early in 2002. This author would suggest that, after finishing off Saddam Hussein, the oil coup will then set its sites on Iran. We can say with certainty that the oil coup will want to have both these countries firmly in control before the OPEC crossover event.
GrGr: There has been a lot of "proof" posted here but none are so blind as those that refuse to see. Ignoring the geopolitical side of the equation is foolish; geopolitics is the main reason for the invasion of Iraq, not US philantropical urges. The geopolitical argument makes a whole lot more sense to me than all the 27+ rationalizations spewed by the Bush administration.
Pipelineistan
"There are also several projects to either truck or pipe energy through Georgian territory. Chevron has a strong interest in this option, along with Conoco. The US Trade and Development Agency funded a $750,000 feasibility study by Enron for a natural gas pipeline from Turkmenistan, through Azerbaijan and Georgia, to Turkey. Another feasibility study was completed by Unocal. There have been negotiating problems among the various countries, and PSO (co-operator with Royal Dutch/Shell) closed its Turkmenistan office in 2000. Talks about the project have resumed, but the legal issues of Caspian Sea ownership complicate the project. (http://www.eia.doe.gov/cabs/caspian.html )
Chevron?s involvement throughout the region is quite ubiquitous. Chevron has invested more than $20 billion in Khazakhstan alone. From 1989-92, Condolezza Rice was on the board of directors of Chevron, and was its main expert on Khazakhstan. (http://www.gasandoil.com/goc/features/fex20867.htm, source: Asia Times Online Co. Ltd)
...
As for the market, the big question has been: should the pipelines flow east or west? The western route would be easier, as much of the infrastructure is already in place. There are several projects underway or completed for bringing energy resources to the west. However, European oil demand over the next 10-15 years is expected to grow by only 1 million bbl/d, while Asian demand is expected to grow by at least 10 million bbl/d over the same period. Therefore, greater profit is seen in piping these resources to the east. Unfortunately, an eastward route would require the longest pipelines in the world. Formidable mountains would require long detours to the north, or a shorter route to the south through either Iran or Afghanistan and Pakistan. The Iranian route is prohibited under the Iran and Libya Sanctions Act. Therefore, Afghanistan and Pakistan are the choice for energy flowing eastward.
...
In July 2001, a strategy to topple the Taliban and replace it with a ?broad-based government,? was discussed during the G-8 summit in Genoa, Italy. (This subject was first broached in Geneva at a May 2001 meeting between the US State Department, Iran, Germany, and Italy.) Following within days of the G-8 summit, secret negotiations were conducted in a Berlin hotel between American, Russian, German and Pakistan officials. Pipelineistan was the central topic of these negotiations, and a plan was set up for military strikes against the Taliban from bases in Tajikistan, to be launched before mid-October 2001. (http://www.oilandgas.com/goc/features/fex20867.htm, source: Asia Times Online Co., Ltd.)
...
Caspian Oil Estimate Revised Down Early estimates of Caspian Sea Oil reserves ranged from 115 to 200 billion barrels. These estimates have been rightfully viewed with skepticism as they were based on a 10% probability of recovery?that is, they were considering oil which could not be recovered. Now this assessment has been severely downgraded by oil industry insiders.
Speaking on 8 April in Almaty at the Eurasian Economic Summit, Gian Maria Gros-Pietro, chairman of Italy's Eni oil company, said the Caspian contains 7.8 billion barrels of oil, the Interfax news agency reported. This is confirmed by Agip?s statement in Energy Day of May 30th that the recoverable reserve potential of Kashagan is only 1.2 billion barrels. With these revisions, it is questionable whether the Caspian Sea region will ever approach the importance of the Middle East with regard to energy reserves. (ASPO Newsletter #18, June 2002; http://www.isv.uu.se/iwood2002...letter/Newsletter.html ) Finally, we refer the reader to the following table of world energy reserves from the BP Review of World Energy 2002. Note that the Caspian Sea region is included in the Former Soviet Union, amounting to less than one tenth of Middle East reserves. In fact, added together, the rest of the world only contains 364.5 thousand million barrels in proven reserves, or 53% of the proven reserves of the Middle East. Source: BP Statistical Review of World Energy 2002; http://www.bp.com/centres/energy2002/index.asp
etc.
---------------
"World Peak oil "
It is in the Middle East that the real grab for world power will be played out. According to Duncan and Youngquist?s model, by 2007 the Middle East will dominate the world in oil production. This will be the last region where oil production will peak, according to Duncan and Youngquist?s model, sometime around 2011. And the oil of the Middle East lies largely in the provinces of five countries: Iran, Iraq, The United Arab Emirates, Kuwait, and Saudi Arabia.
...
All but two of these countries are closely tied to the United States and are likely to be players in the oil coup. The exceptions are Iraq and Iran. Iraq?s ability to export oil has been severely restricted since the first Gulf War. Likewise, Iran faced stiff embargoes following the fall of the Shah in the 1970?s. However, in neither of these countries does the oil coup have clear control over oil resources. Likewise, both countries are targeted as terrorist states. Right now, Israel and powers in the United States are lobbying strongly to make Iraq the next target in the ?War against Terrorism.? Rumor has it that this war is slated to begin early in 2002. This author would suggest that, after finishing off Saddam Hussein, the oil coup will then set its sites on Iran. We can say with certainty that the oil coup will want to have both these countries firmly in control before the OPEC crossover event.
GrGr
Let me rephrase my question requesting the proof.
People have stated that the US went into Iraq to take over the oil.
True, there are companies that have interests in the oil production, pumping, transporting and refining it.
these companies buy the oil based on some agreement with the host government. This has always been the case through the Middle East. The host countries have either controlled the price of the oil when they control the wells) or demanded royalties for the oil when the wells are owned by some other company that is not nationalized.
However, to take over the oil implies that the oil will be routed to the US without compenstation to the Iraqi people. This has not been shown to be true.
Let me rephrase my question requesting the proof.
People have stated that the US went into Iraq to take over the oil.
True, there are companies that have interests in the oil production, pumping, transporting and refining it.
these companies buy the oil based on some agreement with the host government. This has always been the case through the Middle East. The host countries have either controlled the price of the oil when they control the wells) or demanded royalties for the oil when the wells are owned by some other company that is not nationalized.
However, to take over the oil implies that the oil will be routed to the US without compenstation to the Iraqi people. This has not been shown to be true.
"Take over the oil" is an oversimplification of the argument.
Control is the name of the game. The indirect approach (through proxy) is often much more efficient than the direct approach. It is no coincidence that the US has troops strategically placed all over the ME region and the former Sovieti"stan" region, Afghanistan, Georgia etc. and are in cahoots with Pakistan e.g.
Dollar hegemony (international oil trade with dollars and through American oil companies) and US military supremacy will take care of the rest.
------------
TESTIMONY
BY
JOHN J. MARESCA
VICE PRESIDENT, INTERNATIONAL RELATIONS
UNOCAL CORPORATION
TO
HOUSE COMMITTEE ON INTERNATIONAL RELATIONS
SUBCOMMITTEE ON ASIA AND THE PACIFIC
FEBRUARY 12, 1998
WASHINGTON, D.C.
Mr. Chairman, I am John Maresca, Vice President, International Relations, of Unocal Corporation. Unocal is one of the world's leading energy resource and project development companies. Our activities are focused on three major regions -- Asia, Latin America and the U.S. Gulf of Mexico. In Asia and the U.S. Gulf of Mexico, we are a major oil and gas producer. I appreciate your invitation to speak here today. I believe these hearings are important and timely, and I congratulate you for focusing on Central Asia oil and gas reserves and the role they play in shaping U.S. policy.
Today we would like to focus on three issues concerning this region, its resources and U.S. policy:
The need for multiple pipeline routes for Central Asian oil and gas.
The need for U.S. support for international and regional efforts to achieve balanced and lasting political settlements within Russia, other newly independent states and in Afghanistan.
The need for structured assistance to encourage economic reforms and the development of appropriate investment climates in the region. In this regard, we specifically support repeal or removal of Section 907 of the Freedom Support Act.
For more than 2,000 years, Central Asia has been a meeting ground between Europe and Asia, the site of ancient east-west trade routes collectively called the Silk Road and, at various points in history, a cradle of scholarship, culture and power. It is also a region of truly enormous natural resources, which are revitalizing cross-border trade, creating positive political interaction and stimulating regional cooperation. These resources have the potential to recharge the economies of neighboring countries and put entire regions on the road to prosperity.
About 100 years ago, the international oil industry was born in the Caspian/Central Asian region with the discovery of oil. In the intervening years, under Soviet rule, the existence
of the region's oil and gas resources was generally known, but only partially or poorly developed.
As we near the end of the 20th century, history brings us full circle. With political barriers falling, Central Asia and the Caspian are once again attracting people from around the globe who are seeking ways to develop and deliver its bountiful energy resources to the markets of the world.
The Caspian region contains tremendous untapped hydrocarbon reserves, much of them located in the Caspian Sea basin itself. Proven natural gas reserves within Azerbaijan, Uzbekistan, Turkmenistan and Kazakhstan equal more than 236 trillion cubic feet. The region's total oil reserves may reach more than 60 billion barrels of oil -- enough to service Europe's oil needs for 11 years. Some estimates are as high as 200 billion barrels. In 1995, the region was producing only 870,000 barrels per day (44 million tons per year [Mt/y]).
By 2010, Western companies could increase production to about 4.5 million barrels a day (Mb/d) -- an increase of more than 500 percent in only 15 years. If this occurs, the region would represent about five percent of the world's total oil production, and almost 20 percent of oil produced among non-OPEC countries.
One major problem has yet to be resolved: how to get the region's vast energy resources to the markets where they are needed. There are few, if any, other areas of the world where there can be such a dramatic increase in the supply of oil and gas to the world market. The solution seems simple: build a "new" Silk Road. Implementing this solution, however, is far from simple. The risks are high, but so are the rewards.
Finding and Building Routes to World Markets
One of the main problems is that Central Asia is isolated. The region is bounded on the north by the Arctic Circle, on the east and west by vast land distances, and on the south by a series of natural obstacles -- mountains and seas -- as well as political obstacles, such as conflict zones or sanctioned countries.
This means that the area's natural resources are landlocked, both geographically and politically. Each of the countries in the Caucasus and Central Asia faces difficult political challenges. Some have unsettled wars or latent conflicts. Others have evolving systems where the laws -- and even the courts -- are dynamic and changing. Business commitments can be rescinded without warning, or they can be displaced by new geopolitical realities.
In addition, a chief technical obstacle we face in transporting oil is the region's existing pipeline infrastructure. Because the region's pipelines were constructed during the Moscow-centered Soviet period, they tend to head north and west toward Russia. There are no connections to the south and east.
Depending wholly on this infrastructure to export Central Asia oil is not practical. Russia currently is unlikely to absorb large new quantities of "foreign" oil, is unlikely to be a significant market for energy in the next decade, and lacks the capacity to deliver it to other markets.
Certainly there is no easy way out of Central Asia. If there are to be other routes, in other directions, they must be built.
Two major energy infrastructure projects are seeking to meet this challenge. One, under the aegis of the Caspian Pipeline Consortium, or CPC, plans to build a pipeline west from the Northern Caspian to the Russian Black Sea port of Novorossisk. From Novorossisk, oil from this line would be transported by tanker through the Bosphorus to the Mediterranean and world markets.
The other project is sponsored by the Azerbaijan International Operating Company (AIOC), a consortium of 11 foreign oil companies including four American companies -- Unocal, Amoco, Exxon and Pennzoil. It will follow one or both of two routes west from Baku. One line will angle north and cross the North Caucasus to Novorossisk. The other route would cross Georgia and extend to a shipping terminal on the Black Sea port of Supsa. This second route may be extended west and south across Turkey to the Mediterranean port of Ceyhan.
But even if both pipelines were built, they would not have enough total capacity to transport all the oil expected to flow from the region in the future; nor would they have the capability to move it to the right markets. Other export pipelines must be built.
Unocal believes that the central factor in planning these pipelines should be the location of the future energy markets that are most likely to need these new supplies. Just as Central Asia was the meeting ground between Europe and Asia in centuries past, it is again in a unique position to potentially service markets in both of these regions -- if export routes to these markets can be built. Let's take a look at some of the potential markets.
Western Europe
Western Europe is a tough market. It is characterized by high prices for oil products, an aging population, and increasing competition from natural gas. Between 1995 and 2010, we estimate that demand for oil will increase from 14.1 Mb/d (705 Mt/y) to 15.0 Mb/d (750 Mt/y), an average growth rate of only 0.5 percent annually. Furthermore, the region is already amply supplied from fields in the Middle East, North Sea, Scandinavia and Russia. Although there is perhaps room for some of Central Asia's oil, the Western European market is unlikely to be able to absorb all of the production from the Caspian region.
Central and Eastern Europe
Central and Eastern Europe markets do not look any better. Although there is increased demand for oil in the region's transport sector, natural gas is gaining strength as a competitor. Between 1995 and 2010, demand for oil is expected to increase by only half a million barrels per day, from 1.3 Mb/d (67 Mt/y) to 1.8 Mb/d (91.5 Mt/y). Like Western Europe, this market is also very competitive. In addition to supplies of oil from the North Sea, Africa and the Middle East, Russia supplies the majority of the oil to this region.
The Domestic NIS Market
The growth in demand for oil also will be weak in the Newly Independent States (NIS). We expect Russian and other NIS markets to increase demand by only 1.2 percent annually between 1997 and 2010.
Asia/Pacific
In stark contrast to the other three markets, the Asia/Pacific region has a rapidly increasing demand for oil and an expected significant increase in population. Prior to the recent turbulence in the various Asian/Pacific economies, we anticipated that this region's demand for oil would almost double by 2010. Although the short-term increase in demand will probably not meet these expectations, Unocal stands behind its long-term estimates.
Energy demand growth will remain strong for one key reason: the region's population is expected to grow by 700 million people by 2010.
It is in everyone's interests that there be adequate supplies for Asia's increasing energy requirements. If Asia's energy needs are not satisfied, they will simply put pressure on all world markets, driving prices upwards everywhere.
The key question is how the energy resources of Central Asia can be made available to satisfy the energy needs of nearby Asian markets. There are two possible solutions -- with several variations.
Export Routes
East to China: Prohibitively Long?
One option is to go east across China. But this would mean constructing a pipeline of more than 3,000 kilometers to central China -- as well as a 2,000-kilometer connection to reach the main population centers along the coast. Even with these formidable challenges, China National Petroleum Corporation is considering building a pipeline east from Kazakhstan to Chinese markets.
Unocal had a team in Beijing just last week for consultations with the Chinese. Given China's long-range outlook and its ability to concentrate resources to meet its own needs, China is almost certain to build such a line. The question is what will the costs of transporting oil through this pipeline be and what netback will the producers receive.
South to the Indian Ocean: A Shorter Distance to Growing Markets
A second option is to build a pipeline south from Central Asia to the Indian Ocean.
One obvious potential route south would be across Iran. However, this option is foreclosed for American companies because of U.S. sanctions legislation. The only other possible route option is across Afghanistan, which has its own unique challenges.
The country has been involved in bitter warfare for almost two decades. The territory across which the pipeline would extend is controlled by the Taliban, an Islamic movement that is not recognized as a government by most other nations. From the outset, we have made it clear that construction of our proposed pipeline cannot begin until a recognized government is in place that has the confidence of governments, lenders and our company.
In spite of this, a route through Afghanistan appears to be the best option with the fewest technical obstacles. It is the shortest route to the sea and has relatively favorable terrain for a pipeline. The route through Afghanistan is the one that would bring Central Asian oil closest to Asian markets and thus would be the cheapest in terms of transporting the oil.
Unocal envisions the creation of a Central Asian Oil Pipeline Consortium. The pipeline would become an integral part of a regional oil pipeline system that will utilize and gather oil from existing pipeline infrastructure in Turkmenistan, Uzbekistan, Kazakhstan and Russia.
The 1,040-mile-long oil pipeline would begin near the town of Chardzhou, in northern Turkmenistan, and extend southeasterly through Afghanistan to an export terminal that would be constructed on the Pakistan coast on the Arabian Sea. Only about 440 miles of the pipeline would be in Afghanistan.
This 42-inch-diameter pipeline will have a shipping capacity of one million barrels of oil per day. Estimated cost of the project -- which is similar in scope to the Trans Alaska Pipeline -- is about US$2.5 billion.
There is considerable international and regional political interest in this pipeline. Asian crude oil importers, particularly from Japan, are looking to Central Asia and the Caspian as a new strategic source of supply to satisfy their desire for resource diversity. The pipeline benefits Central Asian countries because it would allow them to sell their oil in expanding and highly prospective hard currency markets. The pipeline would benefit Afghanistan, which would receive revenues from transport tariffs, and would promote stability and encourage trade and economic development. Although Unocal has not negotiated with any one group, and does not favor any group, we have had contacts with and briefings for all of them. We know that the different factions in Afghanistan understand the importance of the pipeline project for their country, and have expressed their support of it.
A recent study for the World Bank states that the proposed pipeline from Central Asia across Afghanistan and Pakistan to the Arabian Sea would provide more favorable netbacks to oil producers through access to higher value markets than those currently being accessed through the traditional Baltic and Black Sea export routes.
This is evidenced by the netback values producers will receive as determined by the World Bank study. For West Siberian crude, the netback value will increase by nearly $2.00 per barrel by going south to Asia. For a producer in western Kazakhstan, the netback value will increase by more than $1 per barrel by going south to Asia as compared to west to the Mediterranean via the Black Sea.
Natural Gas Export
Given the plentiful natural gas supplies of Central Asia, our aim is to link a specific natural resource with the nearest viable market. This is basic for the commercial viability of any gas project. As with all projects being considered in this region, the following projects face geo-political challenges, as well as market issues.
Unocal and the Turkish company, Koc Holding A.S., are interested in bringing competitive gas supplies to the Turkey market. The proposed Eurasia Natural Gas Pipeline would transport gas from Turkmenistan directly across the Caspian Sea through Azerbaijan and Georgia to Turkey. Sixty percent of this proposed gas pipeline would follow the same route as the oil pipeline proposed to run from Baku to Ceyhan. Of course, the demarcation of the Caspian remains an issue.
Last October, the Central Asia Pipeline, Ltd. (CentGas) consortium, in which Unocal holds an interest, was formed to develop a gas pipeline that will link Turkmenistan's vast natural gas reserves in the Dauletabad Field with markets in Pakistan and possibly India. An independent evaluation shows that the field's resources are adequate for the project's needs, assuming production rates rising over time to 2 billion cubic feet of gas per day for 30 years or more.
In production since 1983, the Dauletabad Field's natural gas has been delivered north via Uzbekistan, Kazakhstan and Russia to markets in the Caspian and Black Sea areas. The proposed 790-mile pipeline will open up new markets for this gas, travelling from Turkmenistan through Afghanistan to Multan, Pakistan. A proposed extension would link with the existing Sui pipeline system, moving gas to near New Delhi, where it would connect with the existing HBJ pipeline. By serving these additional volumes, the extension would enhance the economics of the project, leading to overall reductions in delivered natural gas costs for all users and better margins. As currently planned, the CentGas pipeline would cost approximately $2 billion. A 400-mile extension into India could add $600 million to the overall project cost.
As with the proposed Central Asia Oil Pipeline, CentGas cannot begin construction until an internationally recognized Afghanistan government is in place. For the project to advance, it must have international financing, government-to-government agreements and government-to-consortium agreements.
Conclusion
The Central Asia and Caspian region is blessed with abundant oil and gas that can enhance the lives of the region's residents and provide energy for growth for Europe and Asia.
The impact of these resources on U.S. commercial interests and U.S. foreign policy is also significant and intertwined. Without peaceful settlement of conflicts within the region, cross-border oil and gas pipelines are not likely to be built. We urge the Administration and the Congress to give strong support to the United Nations-led peace process in Afghanistan.
U.S. assistance in developing these new economies will be crucial to business' success. We encourage strong technical assistance programs throughout the region. We also urge repeal or removal of Section 907 of the Freedom Support Act. This section unfairly restricts U.S. government assistance to the government of Azerbaijan and limits U.S. influence in the region.
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.
Thank you.
Control is the name of the game. The indirect approach (through proxy) is often much more efficient than the direct approach. It is no coincidence that the US has troops strategically placed all over the ME region and the former Sovieti"stan" region, Afghanistan, Georgia etc. and are in cahoots with Pakistan e.g.
Dollar hegemony (international oil trade with dollars and through American oil companies) and US military supremacy will take care of the rest.
------------
TESTIMONY
BY
JOHN J. MARESCA
VICE PRESIDENT, INTERNATIONAL RELATIONS
UNOCAL CORPORATION
TO
HOUSE COMMITTEE ON INTERNATIONAL RELATIONS
SUBCOMMITTEE ON ASIA AND THE PACIFIC
FEBRUARY 12, 1998
WASHINGTON, D.C.
Mr. Chairman, I am John Maresca, Vice President, International Relations, of Unocal Corporation. Unocal is one of the world's leading energy resource and project development companies. Our activities are focused on three major regions -- Asia, Latin America and the U.S. Gulf of Mexico. In Asia and the U.S. Gulf of Mexico, we are a major oil and gas producer. I appreciate your invitation to speak here today. I believe these hearings are important and timely, and I congratulate you for focusing on Central Asia oil and gas reserves and the role they play in shaping U.S. policy.
Today we would like to focus on three issues concerning this region, its resources and U.S. policy:
The need for multiple pipeline routes for Central Asian oil and gas.
The need for U.S. support for international and regional efforts to achieve balanced and lasting political settlements within Russia, other newly independent states and in Afghanistan.
The need for structured assistance to encourage economic reforms and the development of appropriate investment climates in the region. In this regard, we specifically support repeal or removal of Section 907 of the Freedom Support Act.
For more than 2,000 years, Central Asia has been a meeting ground between Europe and Asia, the site of ancient east-west trade routes collectively called the Silk Road and, at various points in history, a cradle of scholarship, culture and power. It is also a region of truly enormous natural resources, which are revitalizing cross-border trade, creating positive political interaction and stimulating regional cooperation. These resources have the potential to recharge the economies of neighboring countries and put entire regions on the road to prosperity.
About 100 years ago, the international oil industry was born in the Caspian/Central Asian region with the discovery of oil. In the intervening years, under Soviet rule, the existence
of the region's oil and gas resources was generally known, but only partially or poorly developed.
As we near the end of the 20th century, history brings us full circle. With political barriers falling, Central Asia and the Caspian are once again attracting people from around the globe who are seeking ways to develop and deliver its bountiful energy resources to the markets of the world.
The Caspian region contains tremendous untapped hydrocarbon reserves, much of them located in the Caspian Sea basin itself. Proven natural gas reserves within Azerbaijan, Uzbekistan, Turkmenistan and Kazakhstan equal more than 236 trillion cubic feet. The region's total oil reserves may reach more than 60 billion barrels of oil -- enough to service Europe's oil needs for 11 years. Some estimates are as high as 200 billion barrels. In 1995, the region was producing only 870,000 barrels per day (44 million tons per year [Mt/y]).
By 2010, Western companies could increase production to about 4.5 million barrels a day (Mb/d) -- an increase of more than 500 percent in only 15 years. If this occurs, the region would represent about five percent of the world's total oil production, and almost 20 percent of oil produced among non-OPEC countries.
One major problem has yet to be resolved: how to get the region's vast energy resources to the markets where they are needed. There are few, if any, other areas of the world where there can be such a dramatic increase in the supply of oil and gas to the world market. The solution seems simple: build a "new" Silk Road. Implementing this solution, however, is far from simple. The risks are high, but so are the rewards.
Finding and Building Routes to World Markets
One of the main problems is that Central Asia is isolated. The region is bounded on the north by the Arctic Circle, on the east and west by vast land distances, and on the south by a series of natural obstacles -- mountains and seas -- as well as political obstacles, such as conflict zones or sanctioned countries.
This means that the area's natural resources are landlocked, both geographically and politically. Each of the countries in the Caucasus and Central Asia faces difficult political challenges. Some have unsettled wars or latent conflicts. Others have evolving systems where the laws -- and even the courts -- are dynamic and changing. Business commitments can be rescinded without warning, or they can be displaced by new geopolitical realities.
In addition, a chief technical obstacle we face in transporting oil is the region's existing pipeline infrastructure. Because the region's pipelines were constructed during the Moscow-centered Soviet period, they tend to head north and west toward Russia. There are no connections to the south and east.
Depending wholly on this infrastructure to export Central Asia oil is not practical. Russia currently is unlikely to absorb large new quantities of "foreign" oil, is unlikely to be a significant market for energy in the next decade, and lacks the capacity to deliver it to other markets.
Certainly there is no easy way out of Central Asia. If there are to be other routes, in other directions, they must be built.
Two major energy infrastructure projects are seeking to meet this challenge. One, under the aegis of the Caspian Pipeline Consortium, or CPC, plans to build a pipeline west from the Northern Caspian to the Russian Black Sea port of Novorossisk. From Novorossisk, oil from this line would be transported by tanker through the Bosphorus to the Mediterranean and world markets.
The other project is sponsored by the Azerbaijan International Operating Company (AIOC), a consortium of 11 foreign oil companies including four American companies -- Unocal, Amoco, Exxon and Pennzoil. It will follow one or both of two routes west from Baku. One line will angle north and cross the North Caucasus to Novorossisk. The other route would cross Georgia and extend to a shipping terminal on the Black Sea port of Supsa. This second route may be extended west and south across Turkey to the Mediterranean port of Ceyhan.
But even if both pipelines were built, they would not have enough total capacity to transport all the oil expected to flow from the region in the future; nor would they have the capability to move it to the right markets. Other export pipelines must be built.
Unocal believes that the central factor in planning these pipelines should be the location of the future energy markets that are most likely to need these new supplies. Just as Central Asia was the meeting ground between Europe and Asia in centuries past, it is again in a unique position to potentially service markets in both of these regions -- if export routes to these markets can be built. Let's take a look at some of the potential markets.
Western Europe
Western Europe is a tough market. It is characterized by high prices for oil products, an aging population, and increasing competition from natural gas. Between 1995 and 2010, we estimate that demand for oil will increase from 14.1 Mb/d (705 Mt/y) to 15.0 Mb/d (750 Mt/y), an average growth rate of only 0.5 percent annually. Furthermore, the region is already amply supplied from fields in the Middle East, North Sea, Scandinavia and Russia. Although there is perhaps room for some of Central Asia's oil, the Western European market is unlikely to be able to absorb all of the production from the Caspian region.
Central and Eastern Europe
Central and Eastern Europe markets do not look any better. Although there is increased demand for oil in the region's transport sector, natural gas is gaining strength as a competitor. Between 1995 and 2010, demand for oil is expected to increase by only half a million barrels per day, from 1.3 Mb/d (67 Mt/y) to 1.8 Mb/d (91.5 Mt/y). Like Western Europe, this market is also very competitive. In addition to supplies of oil from the North Sea, Africa and the Middle East, Russia supplies the majority of the oil to this region.
The Domestic NIS Market
The growth in demand for oil also will be weak in the Newly Independent States (NIS). We expect Russian and other NIS markets to increase demand by only 1.2 percent annually between 1997 and 2010.
Asia/Pacific
In stark contrast to the other three markets, the Asia/Pacific region has a rapidly increasing demand for oil and an expected significant increase in population. Prior to the recent turbulence in the various Asian/Pacific economies, we anticipated that this region's demand for oil would almost double by 2010. Although the short-term increase in demand will probably not meet these expectations, Unocal stands behind its long-term estimates.
Energy demand growth will remain strong for one key reason: the region's population is expected to grow by 700 million people by 2010.
It is in everyone's interests that there be adequate supplies for Asia's increasing energy requirements. If Asia's energy needs are not satisfied, they will simply put pressure on all world markets, driving prices upwards everywhere.
The key question is how the energy resources of Central Asia can be made available to satisfy the energy needs of nearby Asian markets. There are two possible solutions -- with several variations.
Export Routes
East to China: Prohibitively Long?
One option is to go east across China. But this would mean constructing a pipeline of more than 3,000 kilometers to central China -- as well as a 2,000-kilometer connection to reach the main population centers along the coast. Even with these formidable challenges, China National Petroleum Corporation is considering building a pipeline east from Kazakhstan to Chinese markets.
Unocal had a team in Beijing just last week for consultations with the Chinese. Given China's long-range outlook and its ability to concentrate resources to meet its own needs, China is almost certain to build such a line. The question is what will the costs of transporting oil through this pipeline be and what netback will the producers receive.
South to the Indian Ocean: A Shorter Distance to Growing Markets
A second option is to build a pipeline south from Central Asia to the Indian Ocean.
One obvious potential route south would be across Iran. However, this option is foreclosed for American companies because of U.S. sanctions legislation. The only other possible route option is across Afghanistan, which has its own unique challenges.
The country has been involved in bitter warfare for almost two decades. The territory across which the pipeline would extend is controlled by the Taliban, an Islamic movement that is not recognized as a government by most other nations. From the outset, we have made it clear that construction of our proposed pipeline cannot begin until a recognized government is in place that has the confidence of governments, lenders and our company.
In spite of this, a route through Afghanistan appears to be the best option with the fewest technical obstacles. It is the shortest route to the sea and has relatively favorable terrain for a pipeline. The route through Afghanistan is the one that would bring Central Asian oil closest to Asian markets and thus would be the cheapest in terms of transporting the oil.
Unocal envisions the creation of a Central Asian Oil Pipeline Consortium. The pipeline would become an integral part of a regional oil pipeline system that will utilize and gather oil from existing pipeline infrastructure in Turkmenistan, Uzbekistan, Kazakhstan and Russia.
The 1,040-mile-long oil pipeline would begin near the town of Chardzhou, in northern Turkmenistan, and extend southeasterly through Afghanistan to an export terminal that would be constructed on the Pakistan coast on the Arabian Sea. Only about 440 miles of the pipeline would be in Afghanistan.
This 42-inch-diameter pipeline will have a shipping capacity of one million barrels of oil per day. Estimated cost of the project -- which is similar in scope to the Trans Alaska Pipeline -- is about US$2.5 billion.
There is considerable international and regional political interest in this pipeline. Asian crude oil importers, particularly from Japan, are looking to Central Asia and the Caspian as a new strategic source of supply to satisfy their desire for resource diversity. The pipeline benefits Central Asian countries because it would allow them to sell their oil in expanding and highly prospective hard currency markets. The pipeline would benefit Afghanistan, which would receive revenues from transport tariffs, and would promote stability and encourage trade and economic development. Although Unocal has not negotiated with any one group, and does not favor any group, we have had contacts with and briefings for all of them. We know that the different factions in Afghanistan understand the importance of the pipeline project for their country, and have expressed their support of it.
A recent study for the World Bank states that the proposed pipeline from Central Asia across Afghanistan and Pakistan to the Arabian Sea would provide more favorable netbacks to oil producers through access to higher value markets than those currently being accessed through the traditional Baltic and Black Sea export routes.
This is evidenced by the netback values producers will receive as determined by the World Bank study. For West Siberian crude, the netback value will increase by nearly $2.00 per barrel by going south to Asia. For a producer in western Kazakhstan, the netback value will increase by more than $1 per barrel by going south to Asia as compared to west to the Mediterranean via the Black Sea.
Natural Gas Export
Given the plentiful natural gas supplies of Central Asia, our aim is to link a specific natural resource with the nearest viable market. This is basic for the commercial viability of any gas project. As with all projects being considered in this region, the following projects face geo-political challenges, as well as market issues.
Unocal and the Turkish company, Koc Holding A.S., are interested in bringing competitive gas supplies to the Turkey market. The proposed Eurasia Natural Gas Pipeline would transport gas from Turkmenistan directly across the Caspian Sea through Azerbaijan and Georgia to Turkey. Sixty percent of this proposed gas pipeline would follow the same route as the oil pipeline proposed to run from Baku to Ceyhan. Of course, the demarcation of the Caspian remains an issue.
Last October, the Central Asia Pipeline, Ltd. (CentGas) consortium, in which Unocal holds an interest, was formed to develop a gas pipeline that will link Turkmenistan's vast natural gas reserves in the Dauletabad Field with markets in Pakistan and possibly India. An independent evaluation shows that the field's resources are adequate for the project's needs, assuming production rates rising over time to 2 billion cubic feet of gas per day for 30 years or more.
In production since 1983, the Dauletabad Field's natural gas has been delivered north via Uzbekistan, Kazakhstan and Russia to markets in the Caspian and Black Sea areas. The proposed 790-mile pipeline will open up new markets for this gas, travelling from Turkmenistan through Afghanistan to Multan, Pakistan. A proposed extension would link with the existing Sui pipeline system, moving gas to near New Delhi, where it would connect with the existing HBJ pipeline. By serving these additional volumes, the extension would enhance the economics of the project, leading to overall reductions in delivered natural gas costs for all users and better margins. As currently planned, the CentGas pipeline would cost approximately $2 billion. A 400-mile extension into India could add $600 million to the overall project cost.
As with the proposed Central Asia Oil Pipeline, CentGas cannot begin construction until an internationally recognized Afghanistan government is in place. For the project to advance, it must have international financing, government-to-government agreements and government-to-consortium agreements.
Conclusion
The Central Asia and Caspian region is blessed with abundant oil and gas that can enhance the lives of the region's residents and provide energy for growth for Europe and Asia.
The impact of these resources on U.S. commercial interests and U.S. foreign policy is also significant and intertwined. Without peaceful settlement of conflicts within the region, cross-border oil and gas pipelines are not likely to be built. We urge the Administration and the Congress to give strong support to the United Nations-led peace process in Afghanistan.
U.S. assistance in developing these new economies will be crucial to business' success. We encourage strong technical assistance programs throughout the region. We also urge repeal or removal of Section 907 of the Freedom Support Act. This section unfairly restricts U.S. government assistance to the government of Azerbaijan and limits U.S. influence in the region.
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.
Thank you.
IHateMyJob2004
Lifer
Just laugh at the fact that the person most likely to win th eelection is supported by Iran. That's what your$200,000,000,000 has gotten you! Iran * 2
And you know the truth of the current situation over there. Congratulations :roll:
The US has from the beginning been attempting to divide the Iraqis. At first they were counting on the support of the Sunnis to counterbalance the Shiite majority but that plan quickly proved futile (see Fallujah). The US could have held elections earlier but chose not to (out of fear of a Shiite victory of course).
All along the US imperative has been to keep the Shiites from power.
Now the US aim is to preserve their handpicked man Allawi (the old CIA stooge) as puppet in charge after the elections.
One factor that is driving the elections is the fear of Shiite unrest. The US has promised Al Shistani elections and he will wait no longer. Look at the problems the US has putting down the insurgency in Falluja. If the Shiites join in the uprising for real the US will need much more troops and much more money and resources to keep the situation under control, and even then the prospects would be uncertain.
One point of my previous post was that the US has been driving for a civil war situation in Iraq in order to provide an alibi of sorts for continued US presence. The US aim has all along been to remain in Iraq for the long term.
First of all there are not more troops to be had. We would have to pull out of both Europe and South Korea to get more troops, and that would create more instability. There are not enough troops for rotations. Marines are serving 8 months coming back for 6 months and then redploying. This is unsustainable for very long. Unless we increase the size of the US Army we need to cut down the number of Troops we have in Iraq. Under Clinton we reduced the size of the Military to balance the budget. Now we cant even run a war.
In all fairness piasabird, Rumsfeld has also repeatedly rebuked calls to increase the amount of troops in Iraq, saying that we need a "leaner, meaner" force that is more moble.
That's good when dealing with conflicts like Afghanistan, but is worthless for peacekeeping missions.
That's good when dealing with conflicts like Afghanistan, but is worthless for peacekeeping missions.
Europe seems to think we are not needed there.
We pull out of Europe, close the bases and watch the affected economy in those locations go to heck.
that would free up a lot of personel and reduce to costs of maintaining those bases including transfer payments.
The S Korea students feel that we are the threat, not the NK multi-million man army sitting on the border.
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