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Conflict Hinders Plans For Georgian Energy Corridor
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Conflict Hinders Plans For Georgian Energy Corridor



The conflict between Russia and Georgia has not only damaged relations between Moscow and the West. It's also threatened plans to develop an energy corridor through Georgia, a corridor that was supposed to move oil and natural gas from Central Asia to the West. NPR's Ivan Watson reports.

IVAN WATSON: On Monday, Georgian fire-fighters battled a huge blaze after a train exploded on Georgia's main east-west railroad.

(Soundbite of sirens)

WATSON: The blast hit a fuel car from neighboring Azerbaijan, sending a pillar of smoke and fire into the air. Georgian officials accused Russia of mining the train tracks, just as the Georgians had accused Moscow of another mysterious explosion more than a week ago, which destroyed a key bridge on the same railroad line. It can carry up to 70,000 barrels of oil a day for export. Russian generals, whose troops continue to occupy Georgian territory not far from the sabotaged railroad, have denied the accusations. But the incident sent chills down the spines of energy companies and oil producers who have invested years of diplomacy and billions of dollars into developing an alternative energy conduit through Georgia for the transport of oil and gas from the landlocked Caspian Sea to the west. John Roberts is an energy security specialist with the energy news agency Platts.

Mr. JOHN ROBERTS (Energy Security Specialist, Platts): Because something like one and a half percent of world oil supplies that are traded go through Georgia. And in addition, it's increasing likely with - was, before the war, increasingly likely to become a major corridor for gas going from Central Asia to European markets.

WATSON: The railroad is the smallest of several transit systems that snake across Georgia, transporting millions of dollars worth of oil and national gas a day. In addition to the railroad, all three of Georgia's energy pipelines were shut down during the short Russo-Georgian War. Two days before the conflict erupted, a mysterious fire in Turkey shut down the largest pipeline. There is also evidence that Russian aircraft tried to bomb a stretch of the same pipeline in Georgia a few days later. The European Union's envoy to the Caucasus, Peter Semneby, says the conflict has threatened Europe's energy supplies.

Mr. PETER SEMNEBY (European Union, Envoy to the Caucasus): What happens here affects fundamental security interests of the E.U., not least energy interests, energy security.

WATSON: Russia is a major energy producer in its own right. But it also controls most of the pipelines which run from former Soviet Republics around the Caspian Sea to Europe. In recent years, the Kremlin has demonstrated its monopolistic might by shutting off energy supplies during disputes with smaller neighbors.

Professor SEAN ROBERTS (George Washington University): Russia right now dominates all of the transport routes, and therefore has always been able to more or less dictate the terms of that transport.

WATSON: Sean Roberts, who's an Associate Professor at George Washington University's Elliot School for International Affairs.

Mr. ROBERTS: The U.S. and several E.U. countries have been pushing for quite some time to have roots for oil and gas that would circumvent Russian territory. And the Russians saw this as a direct threat the their interests.

WATSON: Two years ago, a consortium lead by BP began pumping oil down a new $4 billion pipeline which runs from Azerbaijan, through Georgia, to a Mediterranean Sea port in Turkey. Washington has been lobbying hard to convince larger energy producers on the Caspian, like Kazakhstan and Turkmenistan, to link up with this pipeline.

(Soundbite of machinery)

WATSON: But energy analysts say the sight of hundreds of Russian tanks rumbling across Georgian territory has done irreparable damage to these plans. And, they say, Russia's show of force has strengthen Moscow's hand in the scramble for access to oil and gas in other former Soviet Republics.

Ivan Watson, NPR News.

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