Just Another Pipe Dream?
Talk of the Trans-Afghan Pipeline raises the prospect of big returns for investors and the Kabul government. But security remains the key unanswered question.
Just Another Pipe Dream?
Talk of the Trans-Afghan Pipeline raises the prospect of big returns for investors and the Kabul government. But security remains the key unanswered question.
The deal has been signed, the partners agreed. Within the next two years, Afghan government officials say, construction will begin on a major gas pipeline that will extend from energy-rich Turkmenistan through Afghanistan to Pakistan, and perhaps on to India.
But even before the ink had dried on the mid-February agreement in Ashgabat, analysts were second-guessing the deal. Despite the brave face shown by the major players, this latest plan could follow several early versions into oblivion – and for the same reason, that instability in Afghanistan casts doubt over any infrastructure project, especially such a big one.
The pipeline is slated to go through Farah, Kandahar, and Helmand – all provinces where Taleban insurgents carry out violent attacks on government troops and institutions on a daily basis.
Once the pipeline clears Afghan territory, it will run into Baluchistan, an area of Pakistan that is now witnessing a bloody insurgency of its own.
The Asian Development Bank, ADB, which is putting together funding for the project, has conducted a survey of the security situation. ADB mission head Brian Fawcett says extra funding will be built into the costings to ensure the pipeline remains safe.
“The security situation is good; we have no problems,” said Fawcett.
The pipeline would be protected from terrorist attack by increasing the strength of the tubing and burying it at least two metres underground, he added. But it is not yet clear what the additional security measures will add to a deal already estimated at 3.7 billion US dollars.
“We are still studying the costs involved,” said Fawcett.
But once the plan is under way, responsibility for security will pass to the governments through whose territory the pipeline runs.
Afghan defence ministry spokesman General Zahir Azimi acknowledges the security challenges inherent in the project, but says his ministry will be able to put effective measures in place to prevent sabotage.
“The insecurity in Afghanistan has external roots. We want to make the countries involved in destabilising Afghanistan to understand that this lack of security will not benefit them, either,” said Azimi.
Accusations that Pakistan is supporting Taleban and al-Qaeda insurgents, with the goal of destabilising its Afghan neighbour, are frequently heard here. Pakistan vehemently denies the charges, but the war of words has damaged relations almost to the breaking point in recent months.
Azimi insists that the pipeline could prove lucrative for Afghanistan – which will earn transit fees from the gas flowing through its territory - and that the world community has assured his government of more serious steps to resolve the country's security problems.
“We are sure that the security situation will improve over the coming two years,” he said.
Azimi echoed the oft-repeated line on the insurgency, insisting that the marked increase in suicide bombings, hit-and-run attacks, and other insurgent tactics in recent months are actually a sign that the Taleban are on the verge of collapse.
“The Taleban are now scattered, and are not able to form an organised front against the Afghan government,” he said. “This is why they carry out furtive attacks.”
The situation across the border in Baluchistan, where fierce clashes have erupted in the past few months, do concern the Afghan defence ministry, Azimi said, but he said that he was confident that over the next two years the insurgents would stop the violence.
Analysts watching the same events are sceptical about this upbeat interpretation.
“The agreement was signed in the expectation that the security situation would change in the next two years,” said political analyst Qasim Akhgar.
“It certainly will, but it is not clear whether it will get better or worse.”
The pipeline proposal has been on the table for decades. The first tentative agreement was brokered in 1984, but fell apart because of the Soviet occupation of Afghanistan. Another plan in the early Nineties was scrapped because of the factional wars that followed the Soviet withdrawal.
Investors remained eager to explore the possibilities, and during the Taleban era two companies vied for the right to take on the project: Unocal, an American company, and Bridas of Argentina.
Both companies were prepared to overlook the Taleban’s less savoury activities if that meant securing their support, and courted the fundamentalist rulers with trips to Buenos Aires and Texas. As well as the economic benefits, it was suggested that the Taleban stood to gain international acceptance of their unrecognised government if they played along.
At the same time, western firms also wooed the warlords who controlled the northern part of the country. At one point, Bridas had an agreement with General Abdul Rashid Dostum that his militias would guard the future pipeline.
All plans ultimately foundered on Afghanistan’s chronic instability. The Taleban were not able to hold the country together, nor did the warlords offer a real alternative.
Afghanistan, despite its problems, has some attractions as an energy transport route, since it bypasses Iran which is under trade sanctions imposed by the United States, and lies sandwiched between oil- and gas-rich Central Asian republics and the energy-hungry subcontinent.
The proposed pipeline will extend 1,780 kilometres, 750 of which will go through Afghan territory. It is expected to carry about 20 billion cubic metres of gas a year to Pakistan and perhaps later India.
Afghanistan stands to earn 400 million dollars a year from the pipeline, which will also provide work for 3,000 Afghans.
Minister for Mines and Industries Mir Mohammad Seddiq Ishan said that no decisions had been made on which companies would implement the project, but that a tender would be held to identify interested parties.
“It may be too big for one company,” he said. “Perhaps several companies will bid on it.”
Bridas, at least, is still keen. “We are ready to accept the security challenge,” said Latifi, a Bridas representative in Kabul. “We realise that the insecurity will continue for some time, but this unrest has economic roots.”
Given the stakes, the governments and other players involved may be willing to gamble that security will indeed improve in coming years.
“There are enormous benefits here. Afghanistan could earn millions of dollars, Pakistan would get the gas it needs, and Turkmenistan would have an alternative to the Russian market," said Qayoum Babak, chief editor of the Jahan-e-Naw (New World) monthly in Mazar-e-Sharif.
But he went on to warn, "These benefits have confused the countries involved, as well as the oil companies. They have lost touch with reality.”
Before anyone starts laying the pipeline, potential investors will want to be sure there is going to be enough gas to fill it. Turkmenistan claims it has immense reserves of gas, but no one had seen any data to back this up until this year. In February, the Turkmen government announced that an audit conducted by United States consultants DeGolyer and MacNaughton indicated that the Dauletabad field – slated to be the main source for the Trans-Afghan Pipeline – contained 4.5 trillion cubic metres of gas, higher than previous estimates.
Much now depends on Dauletabad's reserves proving as rich as the headline figures suggest, because at current levels estimated at 60-65 billion cubic metres, gas production in Turkmenistan will nowhere near enough even to meet the commitments it has been making to Russia, Ukraine, Iran and – for 2009 onwards – China.
According to Latifi, the Bridas official, the future economic benefits for Afghanistan should be enough to change the minds of those who are currently hostile to the pipeline. “We are not linked to any particular group,” he said. “But we will convince all those who oppose the extension of the pipeline that the project will be good for everybody.”
This argument does not sway those observers who maintain that the Taleban and the Baluchistan rebels have no interest in improving the situation - quite the reverse, in fact.
“The Taleban are now fighting the Afghan government and the insurgents in Baluchistan are fighting the government of Pakistan. These groups will never allow their enemies to reap the benefits of this project,” said Babak.
Given the security situation in the southern Afghan provinces, where government convoys come under almost daily attack, Babak describes the proposed pipeline route as “hilarious.”
“Building a valuable pipeline through insecure deserts and regions is impossible and absurd,” said political analyst Mohammad Hassan Wolesmal. “Even if it were built, it would be destroyed immediately.”
Sayed Yaqub Ibrahimi is an IWPR staff reporter in Mazar-e-Sharif. Amanullah Nasrat is an IWPR staff reporter in Kabul.
But even before the ink had dried on the mid-February agreement in Ashgabat, analysts were second-guessing the deal. Despite the brave face shown by the major players, this latest plan could follow several early versions into oblivion – and for the same reason, that instability in Afghanistan casts doubt over any infrastructure project, especially such a big one.
The pipeline is slated to go through Farah, Kandahar, and Helmand – all provinces where Taleban insurgents carry out violent attacks on government troops and institutions on a daily basis.
Once the pipeline clears Afghan territory, it will run into Baluchistan, an area of Pakistan that is now witnessing a bloody insurgency of its own.
The Asian Development Bank, ADB, which is putting together funding for the project, has conducted a survey of the security situation. ADB mission head Brian Fawcett says extra funding will be built into the costings to ensure the pipeline remains safe.
“The security situation is good; we have no problems,” said Fawcett.
The pipeline would be protected from terrorist attack by increasing the strength of the tubing and burying it at least two metres underground, he added. But it is not yet clear what the additional security measures will add to a deal already estimated at 3.7 billion US dollars.
“We are still studying the costs involved,” said Fawcett.
But once the plan is under way, responsibility for security will pass to the governments through whose territory the pipeline runs.
Afghan defence ministry spokesman General Zahir Azimi acknowledges the security challenges inherent in the project, but says his ministry will be able to put effective measures in place to prevent sabotage.
“The insecurity in Afghanistan has external roots. We want to make the countries involved in destabilising Afghanistan to understand that this lack of security will not benefit them, either,” said Azimi.
Accusations that Pakistan is supporting Taleban and al-Qaeda insurgents, with the goal of destabilising its Afghan neighbour, are frequently heard here. Pakistan vehemently denies the charges, but the war of words has damaged relations almost to the breaking point in recent months.
Azimi insists that the pipeline could prove lucrative for Afghanistan – which will earn transit fees from the gas flowing through its territory - and that the world community has assured his government of more serious steps to resolve the country's security problems.
“We are sure that the security situation will improve over the coming two years,” he said.
Azimi echoed the oft-repeated line on the insurgency, insisting that the marked increase in suicide bombings, hit-and-run attacks, and other insurgent tactics in recent months are actually a sign that the Taleban are on the verge of collapse.
“The Taleban are now scattered, and are not able to form an organised front against the Afghan government,” he said. “This is why they carry out furtive attacks.”
The situation across the border in Baluchistan, where fierce clashes have erupted in the past few months, do concern the Afghan defence ministry, Azimi said, but he said that he was confident that over the next two years the insurgents would stop the violence.
Analysts watching the same events are sceptical about this upbeat interpretation.
“The agreement was signed in the expectation that the security situation would change in the next two years,” said political analyst Qasim Akhgar.
“It certainly will, but it is not clear whether it will get better or worse.”
The pipeline proposal has been on the table for decades. The first tentative agreement was brokered in 1984, but fell apart because of the Soviet occupation of Afghanistan. Another plan in the early Nineties was scrapped because of the factional wars that followed the Soviet withdrawal.
Investors remained eager to explore the possibilities, and during the Taleban era two companies vied for the right to take on the project: Unocal, an American company, and Bridas of Argentina.
Both companies were prepared to overlook the Taleban’s less savoury activities if that meant securing their support, and courted the fundamentalist rulers with trips to Buenos Aires and Texas. As well as the economic benefits, it was suggested that the Taleban stood to gain international acceptance of their unrecognised government if they played along.
At the same time, western firms also wooed the warlords who controlled the northern part of the country. At one point, Bridas had an agreement with General Abdul Rashid Dostum that his militias would guard the future pipeline.
All plans ultimately foundered on Afghanistan’s chronic instability. The Taleban were not able to hold the country together, nor did the warlords offer a real alternative.
Afghanistan, despite its problems, has some attractions as an energy transport route, since it bypasses Iran which is under trade sanctions imposed by the United States, and lies sandwiched between oil- and gas-rich Central Asian republics and the energy-hungry subcontinent.
The proposed pipeline will extend 1,780 kilometres, 750 of which will go through Afghan territory. It is expected to carry about 20 billion cubic metres of gas a year to Pakistan and perhaps later India.
Afghanistan stands to earn 400 million dollars a year from the pipeline, which will also provide work for 3,000 Afghans.
Minister for Mines and Industries Mir Mohammad Seddiq Ishan said that no decisions had been made on which companies would implement the project, but that a tender would be held to identify interested parties.
“It may be too big for one company,” he said. “Perhaps several companies will bid on it.”
Bridas, at least, is still keen. “We are ready to accept the security challenge,” said Latifi, a Bridas representative in Kabul. “We realise that the insecurity will continue for some time, but this unrest has economic roots.”
Given the stakes, the governments and other players involved may be willing to gamble that security will indeed improve in coming years.
“There are enormous benefits here. Afghanistan could earn millions of dollars, Pakistan would get the gas it needs, and Turkmenistan would have an alternative to the Russian market," said Qayoum Babak, chief editor of the Jahan-e-Naw (New World) monthly in Mazar-e-Sharif.
But he went on to warn, "These benefits have confused the countries involved, as well as the oil companies. They have lost touch with reality.”
Before anyone starts laying the pipeline, potential investors will want to be sure there is going to be enough gas to fill it. Turkmenistan claims it has immense reserves of gas, but no one had seen any data to back this up until this year. In February, the Turkmen government announced that an audit conducted by United States consultants DeGolyer and MacNaughton indicated that the Dauletabad field – slated to be the main source for the Trans-Afghan Pipeline – contained 4.5 trillion cubic metres of gas, higher than previous estimates.
Much now depends on Dauletabad's reserves proving as rich as the headline figures suggest, because at current levels estimated at 60-65 billion cubic metres, gas production in Turkmenistan will nowhere near enough even to meet the commitments it has been making to Russia, Ukraine, Iran and – for 2009 onwards – China.
According to Latifi, the Bridas official, the future economic benefits for Afghanistan should be enough to change the minds of those who are currently hostile to the pipeline. “We are not linked to any particular group,” he said. “But we will convince all those who oppose the extension of the pipeline that the project will be good for everybody.”
This argument does not sway those observers who maintain that the Taleban and the Baluchistan rebels have no interest in improving the situation - quite the reverse, in fact.
“The Taleban are now fighting the Afghan government and the insurgents in Baluchistan are fighting the government of Pakistan. These groups will never allow their enemies to reap the benefits of this project,” said Babak.
Given the security situation in the southern Afghan provinces, where government convoys come under almost daily attack, Babak describes the proposed pipeline route as “hilarious.”
“Building a valuable pipeline through insecure deserts and regions is impossible and absurd,” said political analyst Mohammad Hassan Wolesmal. “Even if it were built, it would be destroyed immediately.”
Sayed Yaqub Ibrahimi is an IWPR staff reporter in Mazar-e-Sharif. Amanullah Nasrat is an IWPR staff reporter in Kabul.
