Russia, Georgia batte over oil

August 14, 2008 9:58:06 PM PDT
There is a strong case to be made that Russia's interest in Georgia is tied to oil and natural gas. Georgia has four pipelines that are taking away business from Russia.

Georgia serves as a major link to provide Europe with oil and gas. In fact, its network of pipelines has been dubbed the "east-west energy corridor." That corridor earns Georgia $60 million a year, and gives Russia a reason to be jealous.

The ground fighting in Georgia has everything to do with four pipelines that transverse the country. Two of them carry oil and the other two transport natural gas.

Stanford political science professor Michael McFaul says that's why the U.S. and Europe want to see a cease-fire that sticks.

"There's a very important set of pipelines that flow through Georgia to the west from Azerbaijan, and that's why this is more important, I would say, to Western interests and American interests than other ethnic conflicts in other parts of the world," said McFaul, Ph.D.

The pipelines carry oil and natural gas from fields near the Caspian Sea in Azerbaijan to ports in the west. Two of the pipelines are nearly new.

The BTC pipeline opened two years ago. It's 1,100 miles long and the second longest in the world and operated by British Petroleum.

Bay Area based Chevron has an 8.9 percent interest in this pipeline. The BTE pipeline opened last year. It's operated by BP and a Norwegian energy company.

The oil and gas flowing through Georgia is sold to European Union countries. So this is direct competition for Russia, which supplies about one-fourth of the natural gas sold in Europe.

Georgian officials believe the pipelines were targeted by Russian bombs, although not one was destroyed.

Russia's actions could have a chilling effect on plans to build two new pipelines in Georgia, and on plans to use the corridor to transport even more oil to the west.

So restoring stability in Georgia is a strong western interest and one of the reasons Secretary of State Condoleezza Rice is headed to the Georgian capital.

"The provisional ceasefire that was agreed to really must go into place and that means the military activities have to stop," said Rice.

ABC7 News contacted the Russian consulate in San Francisco to seek their side of our story, but no one returned the call.

Chevron is making plans to expand pipelines in the region to transport oil from its Tengiz field in Kazakhstan. A company spokesman said those plans do not involve Georgia.


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