A number of security officers is monitoring the 3 billion dollars tube transporting oil from Azerbaijan deposits to our gas stations. The watchword is: to ward off 3000 Azeri to quit their fields to introduce the longest pipeline in the world.
Built by an international consortium including Eni as well, the tube has become the safest source of supply for Europe and mostly Italy, which has imported 49% of crude oil in 2006.
A huge tube in steel, 1700 km long, that appears in the polluted water of the Caspian Sea, off the capital Baku, running along the Georgian capital Tblisi and arriving in the Turkish harbor Cehyan. The modern version of the ancient silk street where camels caravans used to transport oil (extracted exactly in Azerbaijan for the first time ever) towards West, during the second half of 19th century.
At the beginning of the last century, the Azeri Eldorado used to supply half of the global oil production. After 80 years of USSR domination, it is now rising on the international scene thanks to Baku-Tblisi-Cehyan (BTC). Since its official inauguration in July 2006, 17 billion oil tons have been pumped until today.
Last year, more than 10 billion euros were earned by the national society Socar and the English British Petroleum, possessing the rich claim of Chirag Guneshli. More than e200 billion euros are going to be collected in the coming 15 years. Money that raised the national GNP by 300% compared to 1997 (the highest rate of growth worldwide). Money that can guarantee prosperity to a population -1 out 3 is poor-, or go to one of the most corrupted government in the world.
The Head of State Ilham Alyev, son and heir of legendary Hedar who became independent from Moscow in 1991, is going to repeat his party (YAP) false victory of 2005 parliamentary elections during presidential elections in 2008. Democratization promises to international observers were exchanged with oil and gas exports that are going to be doubled through the new gas pipeline Baku-Tbilisi-Erzurum (BTE) at the end of this year.
Since the beginning of 2006, press has been a little free. Few independent newspapers left were arrested, searched and censored for having criticized government or having satirized Islam (professed by 93% of population ) that here is moderate.
Political opposition, already disunited, lost its external support. “ Azerbaijan is becoming the new Russia of Caucasus” said a EU diplomatic in Baku, “It does not allow any more international community to interfere because of its strategic role of alternative fuels supplier”.
Post-communist reign of Alyev (enclosed between Russia and Iran) is the only corridor for Europe and US to bring at home enormous amounts of Turkmenistan and Kazakhstan energetic resources without being blackmailed by Moscow and middle-east despots.
The future is unknown. Today, 90% of export depends on crude oil which will be consumed around by 2025. Alternative sectors revitalization is in conflict with monopolies of clans in power. The threefold increase in gas and oil domestic prices and the huge inflation caused by the large petrol-dollars dose in the national economy are the results of the liberalization process which the World Bank has claimed for.
Half 2007 state budget -which is 11% financed by BTC revenues- is linked to construction sector where corruption is high. Only 16% is spent in social welfare, health and education. Almost 2% for entrepreneurs and agriculture that are the main productive activities after oil, even if in crisis.
“National projects are too expensive. Many of them are of poor quality and populist” said political expert Ilgar Mammadov of Political and Research Advocacy Institute, “In addition to infrastructure as bridges and roads, structural actions are needed to ensure long term development after oil exhaustion”.
EU allocated 92billion of euros to support 2007-2015 modernization program announced by Alyev. But the regime conservative faction does not want to change public funds managing and above all oil revenues now invested by Socar without being accounted for.
In the undeveloped hinterland there are two third of 8 million of Azeri. Government sells gas abroad and does not want to give it to them. Armenian army is occupying one seventh of the territory because of the Nagorno-Karabakh dispute.
It has been 17 years since negotiations have started and meanwhile 1 million of refugees have lived in poverty, the government only aims to get votes in exchange of some subsidies and the mirage of an armed revenge that had military spending triplicated in 2006.
There is a strong contrast between countryside desolation and welfare of Baku where people are rich thanks to extractive industry. Building boom is transforming the capital city. Now there are cranes, buildings and brand-new hotels around the ancient village of Shirvan and luxurious nineteenth century residences built by old oil owners.
A little far, off shore oil platforms occupy the bay north enclosed by the apocalyptic Absheron peninsula : the most polluted place in the world. There are refineries no longer used, toxic water marshes, disused workers barracks surrounded by prewar pumps extracting the few drops of quality “ white” crude oil (petrol).
The coastal area once symbol of pioneering age of oil, today shows the environmental disaster of Caspian sea, one of the richest habitat worldwide. 64 endemic species of animals out of 300 (seals, sturgeons and migratory birds) are at risk of extinction in Azerbaijan that throws in the sea 1800 tons of oil and other harmful substances every year.
In Baku there has been a meeting between coastal countries signatories of new Teheran Convention that is supposed to stop ecosystem degradation. But maybe it is too late. Condé Nast, the important journey newspaper, has recently included Azerbaijan among 20 natural paradises to visit before they disappear forever.