Pipelines: Carrying Oil and A New Balance of Power from Kazakhstan Towards China

Via Stratfor (subscription required), an excellent analysis of how the balance of power between China, Russia and the United States will change now that ground has been broken on the final portion of a pipeline linking the massive energy reserves of the Caspian Sea directly to China (namely the pipeline connecting the Kazakh cities of Kenkiyak and Kumkol). The project will complete a transport network linking the huge oil fields of the Kazakh sector of the Caspian Sea basin directly to western China.  As the article notes, this is just one part of a long-term geopolitical strategic plan by China to address some of its strategic & natural resource shortcomings:

“…Central Asia — and Kazakhstan specifically — provides China with a means of breaking out of this situation. Lightly populated Kazakhstan has loads of room, loads of energy, and — thanks to the Soviet collapse — offers loads of opportunities for geopolitical expansion. All that it requires is constructing infrastructure to knit the two nations together.

The Kenkiyak-Kumkol line is the second phase of that plan. The first — completed in December 2005 — linked Atasu with China (existing Soviet-era infrastructure allowed this segment to connect as far west as Kenkiyak). Once Kenkiyak-Komkol is completed and a few pumping stations on other pieces of (Chinese-constructed) infrastructure are reversed, China will be linked into three separate Kazakh petroleum basins with the biggest one — the Caspian — sitting right at the end of the Frankensteined line. China’s goal is by 2011 to have the line shipping 400,000 barrels per day (bpd) with eventual upgrades taking that number north of 1 million bpd. And this too is really only the beginning. Plans are in place for building additional oil and natural gas pipelines to capture not just Kazakh energy but Uzbek and Turkmen energy as well. Ground has already been broken on some of the most ambitious of these projects.

The projects will expand China’s geopolitical box, giving it its first large-scale access to non-waterborne imported oil. Until now, U.S. naval superiority has ensured Washington could shut down the Chinese economy without so much as firing a shot. Now, that ability will be blunted somewhat. While this will not translate into instant conflict with the United States — China will still be importing at least another 3 million bpd via oceanborne tankers — it will provide Beijing its first serious strategic wiggle room and make military conflict with the United States at least theoretically possible.

The implications for Russia are far more dramatic. Moscow has always thought of Central Asia as its exclusive stomping ground. This pipeline network undermines that in every way possible. Russian influence is strongest in Kazakhstan; should Kazakhstan find a firmer economic partner to the east, the rest of the “Stans” — none of which borders Russia — are almost certain to follow. For Russia this pipeline means not only the loss of a sphere of influence and the expansion of a potential rival onto its southern flank, but also a weakening of the Russian position vis-à-vis Europe. Russia lacks the natural gas production capacity to supply both its home market and its European customers without a monopoly on Central Asian natural gas. China intends not only to end that monopoly, but also to harvest all of the region’s natural gas for itself.

The Russians have few tools for competing with the growing surge in Chinese power. Economically, the Central Asians would vastly prefer selling their energy to China over Russia — China pays more and connections come with fewer strings attached. There is also the issue of lingering resentment over Soviet imperialism. So unless the Russians are willing to embrace (and pay for) new export options for the Central Asians, the only remaining option is making the Central Asian leadership too scared of Russian retribution to cooperate with China. This is something with which Moscow has a good deal of experience. But until a few members of Central Asia’s inner circles begin meeting untimely demises, Chinese infrastructure will continue inching its way across the border, bringing the entire region ever closer to Beijing’s orbit.”

This entry was posted on Tuesday, December 11th, 2007 at 7:36 pm and is filed under China, Kazakhstan, Russia.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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