Original URL - http://www.cdsp.neu.edu/info/students/marko/reporter/reporter101.html

used without permission, for "fair use" only

Trans-Balkan Oil Pipelines through "No-man's" Land

Underground Games in Kosovo

From the Bulgarian port Burgas, according to one plan, the oil pipeline is supposed to go to Alexandropoulis on the Greek Mediterranean shore, and according to the other plan to the Albanian port Valona on the Adriatic Sea (supported by the USA). Europe promotes the northern Balkan route, from the Romanian port Constanta on Black Sea, over Romanian territory and Serbia all the way to the Croatian port Omisalj on the island of Krk and then further on to Trieste [in Italy]

by Aleksandra TRTICA and Jelica PUTNIKOVIC

Reporter, Banja Luka, Srpska, B-H, February 27, 2001

In March the US Congress will debate the construction of an oil pipeline from Black Sea port Burgas, through Bulgaria and Macedonia to Albanian port Valona on the Adriatic Sea. This pipeline would supply oil (monthly deliveries valued at $600 million) from the Caspian Sea basin to the American market. Stating that the control of the future route of this pipeline (supposed to pump 750,000 barrels of oil daily) from Central Asia towards West is of strategic importance for the USA and possibly the cause for American intervention in Kosovo, the London daily Guardian reminds that transport of oil through Bosporus straits is difficult because of too much traffic and security and ecological concerns.

Reserves: Still not fully explored and defined oil fields in the Caspian Sea basin are, according to the analysts of the current geopolitical conflicts, the chief explanation for the meddling of the USA and Western European countries in the break up of and subsequent events in the former Soviet Union. Namely, the Caspian Sea is believed to be the region which holds reserves of crude oil and natural gas almost as large as the ones in the Persian Gulf.

These reserves are far from the Balkans, but the territories needed for the transport of oil are not. Because of already mentioned constricted traffic through Bosporus western strategists have outlined several potential corridors for the transport of oil.

Currently considered options are in Asia, from the Caspian Sea through Iran to the Persian Gulf, or from Baku to Ceyhan (through Azerbaijan and Georgia to a Turkish Mediterranean port which is, also, supported by the US; this project could be financed by the exploitation of only one oil field in Kazakstan), or go across the Balkans.

The routes of potential trans-Balkan oil pipelines were laid down according to the interests of their future users. From Bulgarian port Burgas, according to one plan, the oil pipeline is supposed to go to Alexandropoulis on the Greek Mediterranean shore, and according to the other plan to Albanian port Valona on the Adriatic Sea. These two options are suitable for the USA, while Europe promotes the northern Balkan route, from Romanian port Constanta on the Black Sea, over Romanian territory and Serbia all the way to the Croatian port Omisalj on the island of Krk and then further on to Trieste [in Italy] where this pipeline would merge with the Alpine oil pipeline (TAL). Thus, besides Serbia, Croatia, Federation BH and Slovenia, this pipeline would secure direct supplies of Caspian oil for Italy, Austria, Germany [and the rest of Western Europe]...

The territory of Yugoslavia (both former and present federation) is significant, therefore, because of its geographic position. Influential American analysts insist on the claim that Yugoslavia is in the immediate neighborhood of a zone of vital US interests - Black Sea/Caspian Sea region. And wherever there are vital US interests, there are NATO troops to protect them. European interests, claim our interlocutors, are even greater, because it is definitely not in the interest of the European Union countries that the key to their supplies is held by someone else.

Profitability: Investments mentioned in connection with these projects are huge, and western oil companies and bankers are, regardless of the eventually chosen oil corridor, interested in "political stability" and want guarantees that in the future there will be no political changes that may endanger their interests. The oil pipelines the Caspian Pipeline Consortium, Baku-Ceyhan, Baku-Supsa, Odesa-Brodi CTPL (Constanta-Trieste) and others are supposed to supply oil from the plentiful Caspian basin oil fields to the world market.

For us in Serbia, of utmost interest is whether the world strategists and financiers will opt for the plan Constanta-Omisalj-Trieste or the southern route Burgas-Valona.

The project SEEL (South East European Line), initiated by the Italian company ENI is actually the corridor for transportation of Caspian oil from Constanta to Trieste, which passes through Serbia and uses the existing system of the Adriatic oil pipeline, all the way to Omisalj, in the first phase, while in the second phase the pipeline would be extended to Trieste where it would merge with the Alpine pipeline.

Because of the political situation in Serbia this project was delayed for some better times. However, because of the already existing Adriatic pipeline system in Serbia and Croatia (representing 65 percent of the route of the future pipeline) this route for the transport of Caspian oil to Trieste was deemed to be the most profitable at the international conference "Adriatic pipeline - new perspectives for transport of Caspian oil to the European and world markets", which was organized by the European Union program INOGATE (Interstate Oil and Gas Transport to Europe), the European Commission and the government of the Republic of Croatia in Zagreb on June 19, 2000. INOGATE programme has been active since 1996, within the TACIS programme of the European Union and is targeting the countries of the former Soviet Union and central and eastern Europe.

Getting in the way: Until the fall of Slobodan Milosevic's regime Croatia insisted that the connection with Constanta bypass Serbia by going through Hungary. However, after October 5 and the political changes in Yugoslavia, the meeting of this same group held in Brussels on October 26 and 27, 2000, expressed support for the transport of Caspian oil following the route from Black Sea, Romania, Yugoslavia and Croatia, respectively from Romanian port Constanta, through Pitesti, and Pancevo to Delnice in Croatia, from where the new pipeline would go towards Trieste and the old one continue to Omisalj on the island of Krk.

At the final meeting of INOGATE a Memorandum of Understanding was signed by the oil transport companies CONPET (Romania), NIS Jugopetrol (Yugoslavia) and the Adriatic pipeline (Croatia). This project was approved by the state institutions in Romania and Croatia and it should soon be ratified by FR Yugoslavia. The project has reached the stage of a feasibility study and setting up of a consortium. The capacity of this pipeline is supposed to be 32 million tones of crude oil per year, while half of that amount would be used by the countries through which territory pipeline passes and rest would be earmarked for Western European customers.

The route leading to Albanian port Valona, besides "getting in the way" of strategic opponents, has other drawbacks. Reporter's interlocutors emphasize that Constanta is a much bigger oil terminal than Burgas. The building of pipeline to the island of Krk is cheaper (because of the exploitation of the existing Adriatic pipeline) and Omisalj is also a much more convenient port for an oil terminal than Valona. While in Omisalj large oil tankers (80,000 to 100,000 tones of capacity) can maneuver with ease, Valona is located in the narrow part of the Adriatic, next to the Otranto strait. Besides, Valona is a shallow port, which is being filled in by sand. Consequently, oil companies claim that the USA hasn't found a suitable location for an oil terminal in Valona.

The choice of Valona for the end point of the pipeline also seems rather curious if one considers that the pipeline from Burgas to Greece would be much shorter and consequently much cheaper.

Key: Pointing out that by the selection of Valona port the USA gains full control of the supply of European countries with Caspian oil, the analysts of European affairs remind that Greece is a EU member country and, consequently the US would be unable to control the pipeline. By creating a crisis spot in Kosovo the USA now controls Albania and the future pipeline.

Having in mind that the USA already controls the production of crude oil in Iraq (current bombardment and new sanctions), in the Persian Gulf, and consequently even that potential route for supplies from the Caspian basin, it is clear that Europe should not be foolish and give up the control of the trans-Balkan route. It remains to be seen whether the EU countries will join Russians in this strategic battle or will wage their oil war on their own.

Translated on March 23, 2001