Brutal force, sure to rock Europe and America at its foundation once the strikes against rioting civilians begin....

http://euobserver.com/18/30794

(SitCen).http://en.wikipedia.org/wiki/Joint_Situation_Centre

Brutal force, sure to rock Europe and America at its foundation once the strikes against rioting civilians begin....

[Bloody protests across Europe over austerity measures

It has begun to unfold. The waves of unrest will envelop the PIIGS countries first, Spain here being the “S” of the PIIGS already engulfed in unrest. We have seen the “G” off it – Greece last summer and are sure to see more. Others will erupt in protests, chaos and violence as the global economy will only descend into further hell....

http://www.infowars.com/wars-could-cost-4-trillion-to-6-trillion/

We are sure to see these events in the US – but we know our police state here, don’t we? And we know on a gut level that they have built enormous strength stealthily in recent years, ready to strike with brutal force, sure to rock America at its foundation once the strikes against rioting civilians begin. They are harsher than riot police in Europe. Europe does not taser and shoot to kill but here they do and will. When the economic riots begin in USofA, the MSM Big Brother propaganda machine will belch out condemnation of rioters. They are our enemy, the terrorists, we must abandon them and save ourselves, it will bellow. And frightened Americans will cower down and comply.
Too fearful to question whether those affected in the first wave of bloody crackdown against rioting Americans and hauled to first FEMA camps are truly guilty of anything other than wanting their rights, freedom and self-governance back. You don’t ask that in a totalitarian regime. You shut up and agree with the state. The Silence of the Lambs. Silence in totalitarian regimes is insidious and unstoppable. I was born in such a totalitarian state and left it. But now I again live in such a state. Because the bottom has fallen out of global democracy and the beast will soon reveal itself like a hologram across the sky everywhere....

http://www.registan.net/index.php/2010/09/30/escalation/

We know that the police brutality and militarized crackdown on civilians which will occur in waves around the globe will be by far the worst in the US. This is the country which was once the shining beacon of democracy. Its torch of liberty must be dramatically and visibly crushed for all the world to see which may still hold a glimmer of hope and look upon the US and its magical old strength of the people but the NWO will crush especially US civilian populations harder than anywhere else in the world. In order to demonstrate that this is the dawn of a new era. An era where the light of liberty shines no more....

http://tarpley.net/2010/09/30/in-1932-fox-helped-make-propaganda-films-for-hitler/

The US population must and will be broken into fearful submission. Economic collapse is cascading in waves around the world and more wars are coming. FEMA camps will soon make their debut, likely to imprison first rounds of domestic terrorists with whom we should not associate or sympathize for our own safety, lest we land in the Empire’s crosshairs and become the next terrorists marked for deportation in their view. Hush, little baby, don’t say a word.....

http://pogoblog.typepad.com/pogo/2010/09/morning-smoke-key-congressional-committee-says-a-nation-at-war-cannot-afford-pentagon-budget-cuts.html

This is where the military machine of global dominance of the controllers originates. London has always been the financial nerve center of it. Rome was where much of the spiritual direction of the sinister plan was housed. And the cold steel of the weapons which will destroy humanity and freedom is the US. We will feel it when they turn this giant military machine on US civilians. Soon. As the economy crumbles more and unrest begins, we will see what that police state with its weapons is capable of.....especially with the infamous White House Murder INC,.....

http://www.voltairenet.org/article167101.html

They will help instigate it, too. Create chaos so they can crack down on chaos. The old Hegelian dance. And take another little piece of our liberties each time.

When waves of violent and bloody economic protests begin in the US as they evolving in Europe and descend into looting and rioting, we will see a first glimpse of the omnipotent power of our police state. It is a matter of time until the first protests become so large in the US and chaos as rampant as NOLA during Katrina was – and then we will see the first wave of thousands Americans detained and transported to FEMA, declared domestic terrorists. It has already begun. What we are seeing in Europe is the small mild form of the terror which will unfold in the US as the wave of panic over economic collapse will begin to take more violent forms. Time is running out. And we are not prepared. Because there is no good way to prepare for what is coming because it is so unimaginably vast and large.

Spain's Dire Choice: Flee The Euro Or Crush Its Own Wages - Spain continues to bring in more good and services than it sells

This is a huge and important issue which affects us all – including here in the US. The Euro is the beloved artificial creation of the NWO. It is instrumental in getting us all to swallow the medicine – see, it isn’t so bad if we give up our borders and currencies – look at Europe, they did it and are happy. If the Eurozone falls apart, the NWO has been dealt the most significant blow we could possibly hope for in slowing or halting the progression of global fascism. Massive measures have been launched to save the Euro – if it fails now, progression to NWO stalls. Global economies will collapse as a result but they will collapse anyway. We will have time to think, regroup and deal with our global predators in the US if the Euro collapses. The protests in Europe are all good. Great. We need more and more of it. At least protesting is not a life-threatening sport in the EU as it is here. I am grateful for the riots.

I am also hopeful that Spain and others will pull out of the EU to save its economy, as outlined in the link above. Germany is nervous. They can carry the EU on its back only so long and then no more and Germany has paid more than its fair share to feed the banksters and support a number of weaker European countries and Germany is tapped out.

I was born and raised in Europe and many there look at me in amazement when I say – I hope the EU collapses. Why? How can I be so regressive, the EU is a good thing, it has brought countries and cultures together!

We can do cultural exchanges in a different arena. Try the Club Med for a socialization forum but do not marry 27 economies to the same currency and mega-banks and mega-corporatism. And I hope this collapses soon. It is the last stop where we can get off as a global community before the train of humanity races off to FEMA camps. The EU protests and potential PIIGS collapse is the very last chance I see for humanity to stop the trains and ovens they have prepared for us.

Watch the EU closely for signs which way it will ultimately evolve here as the global chain reaction which this will be.

Thanks to many...... for keeping up what certainly is an exhausting and increasingly dangerous fight to preserve what is left of our dying freedom of speech, democracy and way of life. If sometimes it feels like a battle against windmills, remember that there have never been windmills which cannot eventually be stopped. The alternatives are unthinkable.

"The greatest triumphs of propaganda have been accomplished, not by doing something, but by refraining from doing. Great is truth, but still greater, from a practical point of view, is silence about truth." - Aldous Huxley, author of Brave New World....

"Think of the press as a great keyboard on which the government can play." - Joseph Goebbels, Propaganda Minister to Hitler

"Propaganda is to a democracy what violence is to a dictatorship." - William Blum

Kazakhstan continues economic recovery

Kazakhstan continues economic recovery
By Robert M Cutler

http://www.east-west.be/emerging_markets/Kazachstan.html


MONTREAL - Kazakhstan's economy has responded strongly to the return of international demand for its energy, mining and manufacturing exports, growing at an 8% rate during the first half from the equivalent period in 2009. That is helping to fuel optimism that Astana looks like weathering the global financial crisis in much better shape than many other countries.

President Nursultan Nazarbayev's most recent ministerial shake-up appears likely to improve government bureaucracy, while state finances should continue to improve as a higher export duty on crude oil comes into force next year. The currency, the tenge, is strengthening after an 18% devaluation in February 2009, and measures taken over the past two years to restructure the banking system appear to be bearing fruit.

True, growth is easing off from the first six months this year, and is likely to be more in the 5% range for the full 12 months. Still, that is up from the 4% previously expected by the government, with industrial production increasing 7.5% year-on-year to account for much of the unexpected expansion. Gross domestic product (GDP) rose 1.2% last year, and 3.2% in 2008, after averaging nearly 10% annual growth over the previous decade.

Going forward, the government has reduced its growth forecast for 2011 to 3.1% from 4%, picking up to 3.3% and 3.5% over the following two years, all based on the assumption of an average oil price of $65 per barrel.

The tenge has since risen to about 146 to the US dollar since February, when the central bank set a tenge-per-dollar band of 145-155, widening the trading range to 127.5-165 eight months ago. The financial authorities are expected to allow it to appreciate further, perhaps to 140 by the end of this year, to counteract an expected rise in food prices due to drought and fires that affected Kazakhstan as well as Russia this summer.

Support for and restructuring of the banking sector, statutorily limiting creditors' prerogatives, seems to be bearing fruit. The International Monetary Fund July 2010 "Article IV Consultation", however, warns of a "large and increasing stock of non-performing loans" and points to the need for a "transparent and comprehensive strategy to resolve bad debts".

Last year, BTA Bank, Alliance Bank, Astana Finance and Temirbank (the last of these then controlled by BTA) defaulted, necessitating restructuring of about $20 billion of debt. Through the first seven months of this year, only BTA Bank and ATF Bank posted losses ($540 million and $108 million, respectively), while other banks broke even or posted profits. The ATF statistic would have been worse but for a $208 million goodwill writedown by its Italian parent, UniCredit, in the second quarter.

By June this year, Halyk Savings Bank had accumulated sufficient additional liquidity to repay to the state-owned Samruk-Kazyna fund a loan of $409 million, 18 months before it was due.

The banking sector will not finish restructuring until sometime next year at the earliest.. Credit

will not proliferate before then and it may be a considerable time before it returns to the levels immediately preceding the global financial crisis, when increasing credit drove economic growth.

Starting in January, Kazakhstan will double its export duty on crude oil to $5.40 per barrel (actually $40 per ton, using for conversion the standard 7.4 barrels per ton, although the figure varies according to the density of the oil). Foreign observers are predictably emitting protests and cautions, but this is only one-fifth of the duty that was in force through January 2009, when it was abolished to assist producers during the financial crisis.

Hydrocarbon revenues will thus increase, but new investment will be on hold until the new government Energy Ministry makes clear what reforms and policies it intends to implement. In March, a new Ministry of Oil and Gas was split from the old Ministry of Energy and Natural Resources and will assume regulatory functions previously exercised by KazMunaiGaz, which became a purely commercial entity. Sauat Mynbaev, who led the Old Ministry, was appointed to head the new one.

Mynbaev was a key player in forcing the consortium developing Kashagan oil deposits to renegotiate its agreement with the government, and he is playing the same role with respect to the Karachaganak gas field. (See Kazakhstan announces new energy directions, Asia Times Online, February 13, 2008; and Kazakhs tighten grip on Karachaganak, Asia Times Online, March 5, 2010.)
At the same time, the Ministry of Economy and Budget Planning was renamed the Ministry of Economic Development and Trade, absorbing part of the function of the Ministry of Industry and Trade (which became the Ministry of Industry and New Technologies) while its own budget planning function was transferred to the Ministry of Finance.

Nazarbayev is famous for his continual reorganizations of the Kazakhstan government bureaucracy, often for administrative and sometimes for political reasons, but this latest cycle looks like a fairly well thought-out rationalization of the division of labor that could streamline or at least ameliorate the state administration.

The TAPI Pipeline Is Killing Nabucco

Sep 27, 2010

Stanislav Tarasov (Russia)

Turkmenistan is attacking Europe’s energy monopoly

Turkmen President G. Berdimuhamedov gave an interview to the national media on the eve of his departure for New York to participate in the 65th session of the UN General assembly. He talked about the need to more energetically involve Afghanistan in future transportation, communications and energy projects in the region in order to “give Afghans confidence in their future.” According to the REGNUM News Agency, Berdimuhamedov said that Turkmenistan “has successfully partnered with the major powers and the world’s main power centers on an equal basis—the United States, Russia, China and the European Union.” Speaking about regional polices, he said Turkmenistan has established “friendly, neighborly and equitable relations with its neighbors and other countries in the region.”

It appears that Ashkhabad has no intention of pitting the first group against the second. Ashkhabad is striving to find its balance among the leading power centers, but it is acting with precision and purpose towards its neighbors. A framework agreement to build the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline was signed during the sixth meeting of the technical working group on the project. TAPI undoubtedly is a large-scale interstate project, and if implemented it would give a strong impetus to economic development in those countries. The project participants agreed to hold a quadrilateral summit in December 2010 in order to arrive at a final decision on the project. However, military operations continue in Afghanistan, and the settlement process there will take several years. Meanwhile, relations between Pakistan and India have been tense for many years, and they will not ease soon. That means just one thing: Ashkhabad has decided to conceal its reluctance to exacerbate its relations with Russia and Iran over TAPI by participating in the frankly politicized Nabucco project. Moreover, it has not dropped its disagreement with Azerbaijan over the disputed Kapaz oil field (called Serdar in Turkmenistan). However, in a conversation with Azerbaijan President Ilham Aliyev literally on the eve of the summit of Turkic speaking countries in Istanbul, Berdimuhamedov assured him that Turkmenistan can handle both Nabucco and TAPI at the same time. Just prior to that, Turkish Energy and Natural Resources Minister Taner Yildiz said that Turkmenistan and Azerbaijan intend to “develop formulas for long-term deliveries of gas from Turkmenistan through the Caspian Sea to Azerbaijan and thence to foreign markets.” For some reason, Ankara continues to believe that an agreement will be signed “in the coming months to support new regional projects like Nabucco” because “preparatory work is being done on a number of projects in parts of the Caspian Sea region where there are no territorial disputes between states.”

According to Deutsche Welle, however, agreement was reached on the TAPI framework agreement that was subsequently signed just as the European Commission was developing proposals to build a Trans-Caspian gas pipeline from Turkmenistan to Azerbaijan without delimiting the Caspian Sea shelf. Tom Mayne, a German researcher at the international organization Global Witness, has concluded that TAPI is turning Nabucco into an idée fixe for the EU. But the intrigue lies in the fact that the European Commission for some reason put forward its old idea at a time when Europe is in fifth place behind China, Russia, Iran and Afghanistan in order of importance to Turkmenistan’s gas policy. That suggests that the EU is trailing in the region and has lost its former political and economic influence. Therefore, by focusing on other more powerful geopolitical partners, Ashkhabad has nothing to lose when it rejects the idea of “energy Eurocentrism.”

Turkmenistan currently has a stable market for its energy resources, and it would be awkward for it to incur unnecessary political costs in the form of worsening relations with Gazprom’s South Stream. Especially since Europe is not fighting for gas pipelines now but for sources of raw materials and markets. Reinhard Mitschek, managing director of the Nabucco Consortium, had good reason for saying that he actually expects to see the first gas for the Nabucco pipeline come just from Iraq and Azerbaijan. But Baku will have to think hard before making that decision. “Azerbaijan is taking a low-profile approach to Nabucco,” believes Baku political analyst Rasim Musabekov. “The transit fees are not particularly important to us. And Turkmen gas in the Turkish market will only increase competition with gas from Azerbaijan.” A number of things could happen in Iraq following the withdrawal of US combat units that will have an adverse impact on Nabucco. As far as the Turkmen gas is concerned, it is under contract, after all—not only by Gazprom but also by the Chinese. Therefore, Turkmenistan simply will not have extra gas for the European market.

Source: New Eastern Outlook

Russia wants to supply all of China's gas needs.....

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Russian President Dmitry Medvedev, left, and his Chinese counterpart Hu Jintao raise their glasses for …

http://news.kievukraine.info/2010/10/putin-visit-raises-speculation-about.html

http://www.themoscowtimes.com/business/article/uranium-deal-faces-us-objections/419316.html

GILLIAN WONG, BEIJING – China and Russia signed agreements Monday to boost energy cooperation, while Moscow said it wants to supply its energy hungry neighbor with all its natural gas needs.

No dollar value was given to the agreements signed during a state visit by Russian President Dmitry Medvedev, but they included documents on cooperation in coal, natural gas, nuclear energy and renewable energy.

Russian Deputy Prime Minister Igor Sechin told reporters in Beijing that Russia is in talks with Chinese partners on plans to launch natural gas supplies to China starting in 2015, according to the state ITAR-Tass news agency.

"Russia is ready to meet China's full demand in gas," Sechin was quoted as saying in the report.

Russian state-controlled gas monopoly Gazprom said that under that agreement it will supply China with 30 billion cubic meters of gas annually for 30 years starting in late 2015. The final deal is expected to be signed next summer, Gazprom said.

Sechin said that if talks with China on gas supplies went well, Russia could sign commercial contracts by the middle of next year, ITAR-Tass said.

Russian news agency Interfax cited Russian Energy Minister Sergei Shmatko as saying that "in my opinion, the main terms of (gas) supplies, apart from the price, have been agreed upon."

Russia is the world's biggest energy producer and China is the world's largest energy consumer, overtaking the United States last year.

Although Europe remains Russia's largest export market for gas and oil, both Beijing and Moscow have been seeking to diversify their energy sources and markets, despite a long history of mutual suspicion and tensions.

Efforts by China and Russia to establish gas ties have been stalled for years, mainly because of disagreement over pricing. While Russia is eager to link gas prices for China to oil prices in the way it does in Europe, China views any European-level prices as too high.

Gazprom's statement made no mention of possible routes for the supply, but the company has been long working on the Altai pipeline project, which would link energy-rich Western Siberia with Shanghai.

Gazprom announced in 2006 that it would build two gas pipelines to China, but these plans have been upset by disagreement over future gas prices.

Turkmenistan, however, is enjoying a head start, with China set to become the largest buyer of gas from the central Asian country over the coming years as a pipeline linking the two countries reaches full capacity. Deliveries began earlier this year and are expected to hit 40 billion cubic meters in 2015.

Medvedev is on a three-day visit that started Sunday. He met Chinese President Hu Jintao for talks Monday and praised closer ties with China.

"I believe that the contact between the two countries is completely in the interest of the Russian and Chinese peoples," Medvedev said in opening remarks.

Hu hailed a "new era" in partnership. "Both sides believe that the current strategic partnership between China and Russia stands at a new starting point," the Chinese leader said at the end of talks.

Hu and Medvedev also attended a ceremony in Beijing to mark the completion of a 625-mile (1,000-kilometer) crude oil pipeline from eastern Siberia to China, which connects Russian oil fields with Daqing, a major oil production base in northeastern China. In late August, Russia opened its section of the pipeline.

The pipeline is part of a deal signed last year in which China will provide a $25 billion loan to Russia in exchange for 15 million tons of oil annually (300,000 barrels per day) for 20 years.

Russia and China fell out bitterly 50 years ago over interpretations of communist ideology. In recent years, their relationship has warmed but they remain divided by culture and a preference in both capitals for acting independently.

Both see themselves as rivals to Washington and all three are permanent members of the U.N. Security Council. China and Russia have close ties to Iran and though they supported U.N. sanctions adopted last month against Tehran over its suspected nuclear program, they have objected to stronger measures.

China and Russia also signed an agreement on fighting terrorism and separatism.

The Collapse of Western Morality.....

http://warisacrime.org/content/road-world-war-iii-global-banking-cartel-has-one-card-left-play

http://onlinejournal.com/artman/publish/article_6372.shtml

The Collapse of Western Morality...... http://dissidentvoice.org/2010/09/the-truth-will-set-u-s-free-breaking-israels-stranglehold-over-american-foreign-policy/ By Paul Craig Roberts http://www.veteranstoday.com/2010/09/28/gordon-duff-war-crimes-americas-moral-meltdown/

Global Research, September , 2010 http://www.veteranstoday.com/2010/09/27/gordon-duff-an-open-letter-to-president-obama-about-american-security/

Yes, I know, as many readers will be quick to inform me, the West never had any morality..... Nevertheless things have gotten much much worse since the utterly corrupt beyond redemption....US government pulled off the barbaric inside Job of 9/11 in 2001..... http://napavalleyregister.com/news/opinion/mailbag/article_e51a24c0-f4b7-5a04-96a5-59328931330d.html In hopes that I will be permitted to make a point, permit me to acknowledge that the US dropped nuclear bombs on two Japanese cities, fire-bombed Tokyo, that Great Britain and the US fire-bombed Dresden and a number of other German cities, expending more destructive force, according to some historians, against the civilian German population than against the German armies, that President Grant and his Civil War war criminals, Generals Sherman and Sheridan, committed genocide against the Plains Indians, that the US today enables Israel’s genocidal policies against the Palestinians, policies that one Israeli official has compared to 19th century US genocidal policies against the American Indians, that the US in the new 21st century invaded Iraq and Afghanistan on contrived pretenses, murdering countless numbers of civilians, and that British prime minister Tony Blair lent the British army to his American masters, as did other NATO countries, all of whom find themselves committing war crimes under the Nuremberg standard in lands in which they have no national interests, but for which they receive an American pay check. I don’t mean these few examples to be exhaustive. I know the list goes on and on. Still, despite the long list of horrors, moral degradation is reaching new lows. The US now routinely tortures prisoners, despite its strict illegality under US and international law, and a recent poll shows that the percentage of Americans who approve of torture is rising. Indeed, it is quite high, though still just below a majority..... http://onlinejournal.com/artman/publish/article_6371.shtml And we have what appears to be a new thrill: American soldiers using the cover of war to murder civilians. Recently American troops were arrested for murdering Afghan civilians for fun and collecting trophies such as fingers and skulls. This revelation came on the heels of Pfc. Bradley Manning’s alleged leak of a US Army video of US soldiers in helicopters and their controllers thousands of miles away having fun with joy sticks murdering members of the press and Afghan civilians. Manning is cursed with a moral conscience that has been discarded by his government and his military, and Manning has been arrested for obeying the law and reporting a war crime to the American people. US Rep. Mike Rogers, a Republican, of course, from Michigan, who is on the House Subcommittee on Terrorism, has called for Manning’s execution. According to US Rep. Rogers it is an act of treason to report an American war crime. In other words, to obey the law constitutes “treason to America....” http://onlinejournal.com/artman/publish/article_6372.shtml US Rep. Rogers said that America’s wars are being undermined by “a culture of disclosure” and that this “serious and growing problem” could only be stopped by the execution of Manning. If Rep. Rogers is representative of Michigan, then Michigan is a state that we don’t need. The US government, a font of imperial hubris, does not believe that any act it commits, no matter how vile, can possibly be a war crime. One million dead Iraqis, a ruined country, and four million displaced Iraqis are all justified, because the “threatened” US Superpower had to protect itself from nonexistent weapons of mass destruction that the US government knew for a fact were not in Iraq and could not have been a threat to the US if they were in Iraq. When other countries attempt to enforce the international laws that the Americans established in order to execute Germans defeated in World War II, the US government goes to work and blocks the attempt. A year ago on October 8, the Spanish Senate, obeying its American master, limited Spain’s laws of universal jurisdiction in order to sink a legitimate war crimes case brought against George W. Bush, Barack H. Obama, Tony Blair,and Gordon Brown. The West includes Israel, and there the horror stories are 60 years long. Moreover, if you mention any of them you are declared to be an anti-semite. I only mention them in order to prove that I am not anti-American, anti-British, and anti-NATO, but am simply against war crimes. It was the distinguished Zionist Jewish Judge, Goldstone, who produced the UN report indicating that Israel committed war crimes when it attacked the civilian population and civilian infrastructure of Gaza. For his efforts, Israel declared the Zionist Goldstone to be “a self-hating Jew,” and the US Congress, on instruction from the Israel Lobby, voted to disregard the Goldstone Report to the UN. As the Israeli official said, we are only doing to the Palestinians what the Americans did to the American Indians. The Israeli army uses female soldiers to sit before video screens and to fire by remote control machine guns from towers to murder Palestinians who come to tend their fields within 1500 meters of the enclosed perimeter of Ghetto Gaza. There is no indication that these Israeli women are bothered by gunning down young children and old people who come to tend to their fields. If the crimes were limited to war and the theft of lands, perhaps we could say it is a case of jingoism sidetracking traditional morality, otherwise still in effect. Alas, the collapse of morality is too widespread. Some sports teams now have a win-at-all-cost attitude that involves plans to injure the star players of the opposing teams. To avoid all these controversies, let’s go to Formula One racing where 200 mph speeds are routine. Prior to 1988, 22 years ago, track deaths were due to driver error, car failure, and poorly designed tracks compromised with safety hazards. World Champion Jackie Stewart did much to improve the safety of tracks, both for drivers and spectators. But in 1988 everything changed. Top driver Ayrton Senna nudged another top driver Alain Prost toward a pit wall at 190 mph. According to AutoWeek (August 30, 2010), nothing like this had been seen before. “Officials did not punish Senna’s move that day in Portugal, and so a significant shift in racing began.” What the great racing driver Stirling Moss called “dirty driving” became the norm. Nigel Roebuck in AutoWeek reports that in 1996 World Champion Damon Hill said that Senna’s win-at-all-cost tactic “was responsible for fundamental change in the ethics of the sport.” Drivers began using “terrorist tactics on the track.” Damon Hill said that “the views that I’d gleaned from being around my dad [twice world champion Graham Hill] and people like him, I soon had to abandon,” because you realized that no penalty was forthcoming against the guy who tried to kill you in order that he could win. When asked about the ethics of modern Formula One racing, American World Champion Phil Hill said: “Doing that sort of stuff in my day was just unthinkable. For one thing, we believed certain tactics were unacceptable.” In today’s Western moral climate, driving another talented driver into the wall at 200 mph is just part of winning. Michael Schumacher, born in January 1969, is a seven times World Champion, an unequaled record. On August 1 at the Hungarian Grand Prix, AutoWeek Reports that Schumacher tried to drive his former Ferrari teammate, Rubens Barrichello, into the wall at 200 mph speeds. Confronted with his attempted act of murder, Schumacher said: “This is Formula One. Everyone knows I don’t give presents.” Neither does the US government, nor state and local governments, nor the UK government, nor the EU. The deformation of the police, which many Americans, in their untutored existence as naive believers in “law and order,” still think are “on their side,” has taken on new dimensions with the police militarized to fight “terrorists” and “domestic extremists.” The police have been off the leash since the civilian police boards were nixed by the conservatives. Kids as young as 6 years old have been handcuffed and carted off to jail for school infractions that may or may not have occurred. So have moms with a car full of children (see, for example, http://www.youtube.com/watch?v=4AaSLERx0VM ). Anyone who googles videos of US police gratuitous brutality will call up tens of thousands of examples, and this is after laws that make filming police brutality a felony. A year or two ago such a search would call up hundreds of thousands of videos. In one of the most recent of the numerous daily acts of gratuitous police abuse of citizens, an 84-year-old man had his neck broken because he objected to a night time towing of his car. The goon cop body-slammed the 84-year old and broke his neck. The Orlando, Florida, police department says that the old man was a “threat” to the well-armed much younger police goon, because the old man clenched his fist. Americans will be the first people sent straight to Hell while thinking that they are the salt of the earth. The Americans have even devised a title for themselves to rival that of the Israelis’ self-designation as “God’s Chosen People.” The Americans call themselves “the indispensable people.”

Despite Progress, Nabucco Still Faces Lack of Suppliers

Andrea Bonzanni | Sep 2010

On Sep. 6, the European Investment Bank, the European Bank for Reconstruction and Development, and the International Financial Corporation (a branch of the World Bank Group) signed a mandate letter with the consortium behind the Nabucco natural gas pipeline, marking the start of an appraisal process that will eventually secure a €4 billion financing package for the project. The three international financial institutions committed €2 billion, €1.2 billion and €800 million, respectively. Along with the more modest €200 million grant provided by the European Commission last March, the contributions will certainly boost confidence in the project among private investors, who must finance 70 percent of the estimated €7.9 billion necessary to complete the pipeline.

A few days after the signing, the consortium's managing director, Reinhard Mitschek, confirmed that the pipeline will be supplied by two feeder lines linking the Turkish terminal of Eruzum to Georgia and Iraq, adding that deliveries should start in late 2015. However, despite the progress in financing the project and the optimistic pronouncements, filling Nabucco with gas still represents a major challenge. A third feeder line from Iran, contemplated when the project was first proposed in 2002, has been ruled out for geopolitical reasons. And notwithstanding Mitschek's assurances, no binding agreement has yet been signed for the remaining two.

The Iraqi route is the most problematic, given the many unknowns surrounding the country's future. The Nabucco consortium and its members are currently working on two separate tracks in the country, receiving repeated reassurances from Iraqi Prime Minister Nouri al-Maliki while also working closely with the Kurdistan Regional Government (KRG) in northern Iraq. Maliki went so far as to promise to supply 15 billion cubic meters of gas at the signing of the intergovernmental agreement in Ankara in July 2009. And on Aug. 27, Germany's RWE, a partner in the consortium, signed a cooperation agreement with the KRG that includes the sale of up to 20 bcm to Turkey.

However, in addition to the problems posed by the fragile security situation and the activities of the Kurdish Workers' Party (PKK) in the Kurdish region, the deal has been challenged by Baghdad's central government, which does not recognize the rights of regional entities to negotiate oil and gas contracts. As for the reserves in the western Anbar province, though more tightly under Baghdad's control, they are not any more easily marketable due to the absence of feasible transit routes. The proposed extension of the Arab Gas Pipeline, now running from Egypt to Syria, has stalled, also blocking access to gas from Egypt's off-shore fields, which are progressively being contracted for liquefaction rather than for transportation by pipeline.

The situation facing the feeder line to Georgia, connecting Nabucco to Central Asia's reserves, is only slightly more promising. Turkmenistan, until recently considered a probable supplier, seems to have distanced itself from the project. The long-discussed Trans-Caspian pipeline, which would have connected Turkmen fields to Baku, has not materialized. As a result, Turkmenistan has quietly looked elsewhere for customers, signing profitable agreements with China and Iran, as well as ironing out its commercial disputes with Russia. Ashgabat has even revived the TAPI project, a 1,040-mile pipeline to Pakistan and India through Afghanistan, leaving little room for westward exports. A proposal put forward in July by Italy's ENI to transport compressed natural gas from Turkmenistan to Azerbaijan was greeted with little enthusiasm, not surprising in light of a decade-long dispute between the latter two countries over the production from three shared off-shore oil fields. Similarly, recent attempts to interest Kazakhstan in participating in the project, culminating with German Chancellor Angela Merkel's official trip to Astana, have not led to any breakthroughs.

Meanwhile, Azerbaijan, always seen as Nabucco's only secure supplier, is losing confidence in the project and exploring alternatives. At the beginning of September, during Russian President Dmitry Medvedev's visit to Baku, Gazprom and Azerbaijan's national oil company SOCAR upgraded their gas relations, signing a contract doubling the sale of Azerbaijani gas to Russia, from the current 1 bcm to 2 bcm. Two weeks later, the AGRI project, which plans to transport 2 bcm to 8 bcm of gas from Azerbaijan to Romania and Hungary via Georgia and the Black Sea, was approved by the four governments concerned. Furthermore, Azerbaijan has also intensified cooperation with Iran and is envisaging gas sales to China.

These moves do not yet mean that Azerbaijan has abandoned Nabucco. The country's production will peak at more than 45 bcm in 2016-2017, when the field at Shah Deniz Phase II comes on-stream, and Nabucco still represents the best solution to marketing the bulk of the added output. Nonetheless, they surely signal that doubts are mounting in Baku about Nabucco's feasibility, leading the country's leadership to keep the door open to second-best solutions.

Taken together, these developments suggest that the sheer size of international funding and institutional support that Nabucco has gained may not make up for the absence of available gas to contract for the pipeline. According to the consortium, the contract-signing phase, dubbed "Nabucco Open Season," is likely to begin in late-2010 or early 2011. But at present, it looks like it will be very hard to secure the 18 bcm to 20 bcm necessary for the planned first phase of construction, let alone the 31 bcm forecasted at maximum capacity.

Surely, Nabucco has already overcome significant obstacles as well as the deep skepticism greeting the project since its inception. However, each stage of the project so far has been pushed ahead in the hopes that suppliers would be found at a later point. Now, the moment of truth has come, and any further delays in coming up with the gas to fill the pipeline may well doom the entire project.

Andrea Bonzanni is an international affairs and energy policy analyst based in Geneva.


http://www.google.ch/#hl=en&source=hp&biw=1016&bih=562&q=politics+of+the+Arctic%2C+geopolitics%2C+security+and+international+startegies&btnG=Google+Search&aq=f&aqi=&aql=&oq=politics+of+the+Arctic%2C+geopolitics%2C+security+and+international+startegies&gs_rfai=&fp=6307c130a13444ea

Salami tactics

http://online.wsj.com/article/SB10001424052748703467004575464113605731560.html?mod=WSJ_hpp_LEFTWhatsNewsCollection

http://www.kitco.com/ind/willie/sep232010A.html

Salami tactics By Chan Akya http://www.atimes.com/atimes/China/LI25Ad01.html The idea of salami tactics that were first popularized by the communists and Marxists in the run-up to and after the Russian revolution attained a new level of public awareness after the idea was explained in detail during the first episode of the first series of the cult British comedy, Yes, Prime Minister. Script from the episode details the exchange between the prime minister and his chief scientific advisor (CSA) on whether a nuclear deterrent had any practical or operational credibility (here the prime minister is writing in the first person and the CSA is the second person): "'Why does the deterrent deter the Russians from attacking us', that's what he was asking. Because, I replied firmly, they know that if they launch an attack I'd press the button." "You would?" He sounded surprised. "Well I hesitated, wouldn't I?" "Well would you?" "In the last resort, yes. Definitely." I thought again. "At least I think I definitely would." His questions continued relentlessly. I had to think carefully. "And what is the last resort?" "If the Russians invade Western Europe." That at least seemed quite obvious. [CSA] Professor Rosenblum smiled. "But you would only have 12 hours to decide. So the last resort is also the first response, is that what you're saying?" Was that what I was saying? It seemed crazy. The Chief Scientific Adviser stared at me critically. "Well, you don't need to worry. Why should the Russians try to annex the whole of Europe? They can't even control Afghanistan." He shook his head. "No. If they try anything it will be salami tactics." [Salami tactics was the description customarily given to slice-by-slice maneuvers, ie not a full-scale invasion of the West, but the annexation of one small piece at a time. More often than not, the first steps would not be annexation of land but small treaty infringements, road closures, etc. Ed] I have thought about salami tactics a lot recently because of the ongoing rally in risky assets across the markets after a summer filled with doubts about the very real possibility of a double dip recession that seemed inevitable for both the US and Europe. Ups and downs in economic cycles aside - in other words it doesn't really matter if the next US payroll report is a negative 24,000 or negative 125,000; rather what matters is the long-term (secular) direction of the US and European economies. When I wrote The Short List before the summer break (Asia Times Online, July 3, 2010), it made several key points about trends; and even as markets have been range-bound, those issues have come back to the front boiler. If there is one thing that reading various books written on the events leading up to the 2007 financial crisis has highlighted, it is that very intelligent people failed to see the crisis developing right in front of their eyes simply because they were left to obsess over mundane and ultimately useless details - such as credit ratings, mortgage scores and loans-to-value - rather than the more important holistic questions involving broad strategy and sustainability. Pensions mess At the current juncture we appear to be heading for a farcical repeat of history as investors out there are being distracted away from thinking about the following two major (secular even) themes that are likely to dominate the investment landscape for many decades to come. This is the financial and economic equivalent of the old "the Russians are coming" cliche. These are: The burgeoning pensions crisis in Japan, Europe and the United States. Declining profit potential of companies located in Japan, Europe and the US. These are significant stories, and they are also inter-linked because the declining consumption of goods and services predicated by an aging population in Europe and the US feeds back into the lower margins for companies based in these countries until eventually the only ones that can afford to operate in these areas are the ones for whom the provision of products and services signifies a marginal cost to the "main" business of making profits in Asia, Latin America and (eventually) Africa. Add to this the notion of persistent deflation, which appears inevitable, and it is clear that the credit risks of owning debt in these parts of the world far outstrips the immediate (ie short-term) attractiveness of owning government-issued or highly-rated bonds. There is a further linkage here - as markets have panicked themselves into buying government bonds, the resulting decline in bond yields means that the present value of pension obligations has escalated dramatically. Much like in the case of Japan, lower current returns on a rising debt load mean that an eventual increase in debt would prove unsustainable. In the first instance, I would like the world to wake up to the dangers of Japan blowing itself up spectacularly over the next decade or so; and in the second, remain cognizant of similar risks bubbling to the surface in Europe and the US. Considered in that light, the "Great Sovereign Debt Crisis" of 2010 would likely seem like a measly appetizer of the sort that supermodels feed on before a fashion shoot; before the main event namely a full blown global sovereign credit crisis emerges by 2020. Even if investors were to not pay attention to these facts, they should at least remain cognizant of recent historical returns. Bloomberg shows the following chart for the Dow Jones Industrial Average for the period from September 1999 to September 2010, ie a range of 11 years. Over the period, precious nothing has happened despite the gut-wrenching volatility of these years. The world's most-watched stock market has (basically) produced no real returns at all, even before one considers the vagaries of inflation: Over a similar period, namely from 2001 to the present, Bloomberg shows the following chart for current yields on the US 10-year government bond yield, highlighting the amazing bull market in bonds, which is unlikely to be repeated for the next few years if for no other reasons than purely mathematical ones. But we have seen this movie before, even if our brains refuse to acknowledge this reality. This was called Japan, and it has played in front of our eyes for the past 20 years (note here that the graph is slightly misleading in the sense that the purported "negative" return for the bonds, ie Japanese government bonds (JGBs) is actually a positive figure that signifies deflation, in turn feeding into the compound negative return for equities over the period): Rising government debt All of this is relevant precisely because of the vast increases in the present value of pension obligations once we start playing around with expected returns. For these purposes, the present value is the amount you would set aside today, with certain assumptions on returns. A sample calculation is shown below, which compares the immediate (present) value (PV) of a constant stream of pension payments of say 25,000 per year with the usual simplifying assumptions on timing. With that in mind, a typical long stream of income requirements (over 15 years, which is consistent with the increased life expectancy in the US, Japan and Europe) shows an exponential increase in the PV - a simple change from 5% to 1% takes the PV up five times, to 2.5 million, from 0.5 million. Annual income 25,000 25,000 25,000 25,000 25,000 Discount rate 10% 7.5% 5% 2.5% 1% Present value 250,000 333,333 500,000 1,000,000 2,500,000 Put another way, the gap in pension income would become a significant drag on US and European economies over the next few years, with governments having to dig ever deeper into their pockets for welfare funding. Calculating the gap is easy, by fixing an amount that is available today and then assessing annual income relative to the expected income of 25,000 in the above example. Pension pot 500,000 500,000 500,000 500,000 500,000 Annual income 50,000 37,500 25,000 12,500 5,000 Expected income 25,000 25,000 25,000 25,000 25,000 Surplus/defecit 25,000 12,500 0 -12,500 -20,000 In this case, our standard pensioner has set aside 500,000 to fund his lifestyle; if one uses the discount rates as the actual income rates every year, we get the symmetric results that show a rapid decrease in disposable income for declines in annual returns. Thus, the pension who created a conservative pension pot with an assumption of 5% annual returns would have significant surpluses if returns went to, say 10%. This would equate to greater capital formation, that is, money available for conspicuous consumption such as an expensive car or a younger wife, or even new business investments and the like. On the other hand, a decline in the annual returns (which is now more likely) would create a significant gap; the declines in disposable income having to be met with the social funding obligations of the government and the like. The pensions gap is thus the core weakness of governments across Europe and the US; and it is the main reason why a spiral of rising debt loads with all its attendant problems appears inevitable. Rising tax rates and demands for higher wages (to compensate for reduced investment income) coupled with the needs of an aging population on social aspects such as job security imply that the competitiveness of European and US businesses is set to decline precipitously over the coming years. The resulting decline in profits would pummel stock valuations. Financial salami It stands to reason that anyone looking at this would have an aneurism and sell everything in the markets to stock up on guns and gold; and yet, on balance, more people recently are buying risk than selling it. That brings us to the question at the top of this article, namely how are the salami tactics being implemented this time around? From what I can see, slice by slice the following is happening across the markets: First, distraction - namely the creation of a host of sensational and speculative stories in the media that receive saturated coverage, in effect creating significant noise that blocks out all rational and well-poised analysis of longer-term issues. In this matter, any number of issues can be used - ranging from the fracas around the American Tea Party movement (yes, I believe that even those opposed to US government have a starring role to play, albeit unintentionally), the French ban on burqas (see Burqas over the Bastille, Asia Times Online, July 24, 2010), the controversy about rights for homosexuals in the US and so on. With enough distraction, even people who are mighty concerned about the longer-term state of affairs would give up thinking and join the festival of self-pity. Second, confusion - namely to create the notion of "emergency" short-term measures that are designed to correct a specific situation that had gotten out of hand, all the while reassuring a gullible public that the measures would be reversed once the situation becomes normal. In the world of economics and finance, I add to this category all the central bank liquidity (quantitative easing, or QE), bank bailouts, fake stress tests and whatever else (see Unholy trinity sets up bank failures, Asia Times Online, July 31, 2010). Third, obfuscation - namely to hide relevant information from the investing public with a view to keeping the game going for just a little while longer. This is the primary reason why senior "risk" managers in the developed world - that is, the heads of government, finance ministers and so on - are actually spending a lot of time explaining how things aren't as bad as they appear. They may or may not be, but the role of a risk manager is to prepare for an eventuality rather than go through the motions of his job by assuming the status quo persists indefinitely. With the general public possessing the attention span of a garden mouse and the investing public not boasting a significant improvement over that figure, it becomes a plausible strategy over the long term. Last, seizure - namely to wait until the very last moment and then take aggressive action; such as forced seizures of pension funds, nationalization of investment pools, mandating government-owned entities or departments to perform asset strips and so on. In various countries the process would be timed and executed differently depending on how wide the population is distributed and the prevalence of income inequality as a guiding force to populist seizures. Economist and New York Times columnist Paul Krugman talks about a 60% tax in the US, while the government of Japan talks about seizing unclaimed bank balances; soon the talk will turn to reality. Greek example Let us look at a concrete example of how salami tactics allow a particularly bad financial crisis to linger on for months at hand without any resolution, and yet with no end-game in sight either. Enter, stage left, Greece. Look at the graph of five-year credit default swaps (CDS) provided by Bloomberg on Greece, and one can see that anyone who did NOT panic to cover in February and March was basically destroyed by the volatility that came through thereafter. The much-vaunted improvements have done nothing for the country, as insurance premiums (ie CDS levels) are still massively elevated relative to a year ago. Consider then the "salami" tactics that allowed most holders of Greek sovereign debt at the start of this year to remain holders to this day: 1. Distraction - when the Greek financial crisis became the main talking point earlier in the year, the first act was to focus on distraction. This was achieved by talking about the assistance given by Goldman Sachs to the previous Greek government in hiding their gross debt figures. News reports of the strikes across the country with images of people hurling objects and setting fire to buildings soon followed; and the end result is that the financial aspects of the Greek crisis took a back seat to the "people angle", ie socio-political, rather than purely economic, commentary that is so favored by news networks. 2. Confusion - the notions of whether Greece would default or not became a matter of much conjecture, with the Germans saying one thing and the French quite another. Then the British, Spanish and Dutch all weighed in with their own views of the situation and of course, rolled in the International Monetary Fund (IMF). This confusion was designed to keep people invested in the country's debt, because of course no one would offer a price to buy something like that when all this confusion raged. Thus, a whole coterie of reluctant investors stood around, waiting for a bailout. 3. Obfuscation - this was achieved on multiple fronts, by the simple expedient of designing the bailout package to meet all near-term obligations but leave the sustainability of the debt load itself unaddressed. Banks that owned exposure to Greek sovereign debt in Europe were reassured by another act of obfuscation, namely the entirely silly "stress tests" that were designed exclusively for them to pass. There was talk of assistance from the IMF et al, and yet no material improvements in the actual revenue situation in Greece. 4. Seizure - eventually Greece will default, and in doing so it would seize the savings of various European nations that have bandied together to provide aid required to the country. This is the end-game, and everyone knows it. Yet, the general trend in the market is to not think too much about that and instead focus on the small (and immaterial) positive bits of news along the way. You know, the ones on the lines of "they don"t cheat on taxes as much as previously". Gee, what a relief that is. Conclusion In the Yes, Prime Minister episode with which I started this article, the CSA outlines his version of how the Russians could take Europe without the UK ever firing a shot. CSA: "Scenario one - Riots in West Berlin, buildings in flames. East German fire brigade crosses the border to help. Would you press the button ... ? The East German police come with them. The button ...? "Then some troops, more troops just for riot control, they say. And then the East German troops are replaced by Russian troops. Button ...? "Then the Russian troops don't go. They are invited to stay to support the civilian administration. The civilian administration closes roads and Tempelhof Airport - now you press the button?" Prime minister: "I need time to think about it." CSA: "You have 12 hours." PM: "Have I?" With a wry smile, one has to acknowledge that this is precisely what is happening in (and going forward, to) the world of finance. Me, I am still following the advice outlined a few years ago in my article In gold we trust (see Asia Times Online, September 8, 2007).

Turkmenistan signals Nabucco intentions

http://www.globalresearch.ca/index.php?context=va&aid=20411

Turkmenistan signals Nabucco intentions.

http://www.gundogar.org/?024100000000000000011062011010000#10479

By Robert M Cutler


MONTREAL - "We are currently constructing the East-West Pipeline [across southern Turkmenistan, which] will be laid along the coast of the Caspian Sea ... Nabucco is associated with this project." Thus spoke Turkmenistan's President Gurbanguly Berdimuhamedow at a press conference last week, as reported by many international sources, including Azerbaijan's Trend News Agency, despite the fact that these words did not appear in the official transcript of his remarks as cited by his government's news agency.

Contrary to Berdimuhamedow's statement, the East-West Pipeline properly speaking, which will be constructed to carry a minimum of 30 billion cubic meters per year (bcm/y) at an estimated cost of US$2 billion, does not run along the country's Caspian Sea coast: rather, that is the Caspian Coastal Pipeline (CCP or Prikaspiiskii, sometimes "Pre-Caspian").

The CCP is part of the western branch of the Soviet-era Central Asia-Center (CAC) pipeline, which itself is more a spidery network than a pipeline, running through Uzbekistan and Kazakhstan into Russia. In December 2007, Turkmenistan, Kazakhstan and Russia signed an agreement to refurbish and reconstruct the CCP, with each country responsible for carrying out the works on its own territory; however, none of that ever happened.

Berdimuhamedow's words raise the possibility that Turkmenistan may reconstruct its own segment of the CCP, running along the coastline in the country's northwest, to connect it up to the East-West Pipeline. But why would it do so? Energy relations with Russia are at low ebb, and with Kazakhstan President Nursultan Nazarbaev's criticism of Europe for dragging its feet on Nabucco it seems unlikely that Kazakhstan has done any work on its own segment of the CCP for export of gas to Russia.

The answer is the following. As is well known, there continues to be a territorial disagreement between Turkmenistan and Azerbaijan over the principle by which to delimit national offshore sectors for undersea resources, and this has impeded the former's gas from transmission into the latter's infrastructure that could take it to European consumers. (See Another trans-Caspian pipedream, Asia Times Online, October 24, 2007; and The Caspian boils again, Asia Times Online, July 31, 2009.)

Although it would be possible to agree terms to construct a trans-Caspian gas pipeline between those two countries in the absence of agreement over that territorial question, another eventual possibility has been to build a pipeline from an offshore Turkmenistani field now under exploration so as to intersect an undersea Kazakhstan-Azerbaijan pipeline that will take gas from Kazakhstan's offshore Kashagan deposit under the sea to its western shore. That gas is projected to fill an onshore pipeline to be constructed by Kazakhstan along its seacoast from Eskene to Aqtau, whence an undersea pipeline could be constructed to Azerbaijan.

Thus Berdimuhamedow implicitly evokes the possibility that onshore gas from Turkmenistan (through the East-West Pipeline) may transit a refurbished and reconstructed CCP, not for export to Russia through Kazakhstan but rather for export overland to Kazakhstan. That gas would then reach Aqtau and take a left turn to join (or even precede, since Kashagan development and Eskene-Aqtau pipeline construction will take some time) Kazakhstani gas in an undersea Kazakhstan-Azerbaijan pipeline towards a European destination

.

He implicitly evoked this possibility in his original announcement of the projected length of the East-West pipeline. The distance between his two estimates of its length is 200 kilometers: approximately the distance from the East-West Pipeline's western terminus proper to the Kazakhstan border itself. To say that the East-West Pipeline will be "laid along the coast of the Caspian Sea" is to say that the Turkmenistani segment of the CCP will be explicitly considered as an extension of the East-West Pipeline itself.

Such a route would help to justify and kickstart the Eskene-Aqtau gas pipeline, in turn facilitating implementation of Kashagan development. The cost-effectiveness of liquefied natural gas and compressed natural gas technologies is also being studied.

A further indication of Turkmenistan's intent to dedicate the East-West Pipeline for export to Europe comes from information reported earlier this month by the Indian Express newspaper, that Ashgabad has informed the Technical Working Group on the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline that gas for this project will not come from Dauletabad as previously planned but rather from the South Yolotan-Osman supergiant field that is already also supplying China via a pipeline transiting Uzbekistan and Kazakhstan.

Despite the planned extension of the Turkmenistan-Iran gas pipeline to Dauletabad on the Turkmenistan side, there is not enough demand by Iran to account for such a switch. The only reasonable conclusion is that Berdimuhamedow sees Dauletabad gas going to Europe through the East-West Pipeline.

Turkmenistan has been exporting gas to northeastern Iran for years, although during the Turkmenbashi era (that is, the presidency of Saparmurat Niyazov, who died in December 2006), sales targets were rarely met for a variety of administrative and industrial reasons. Since Berdimuhamedow came to power, the gas trade has been regularized and apparently put on a more systematic footing, to such a degree that earlier this year a pipeline extension was opened with a view towards increasing gas exports from the current reported level of 8 bcm/y to 20 bcm/y. The existing pipeline, which opened in 1997 runs from Koropeje to Sarakhs.

There has been some misunderstanding of this project even in the specialized international commentary and analysis. It is not a new pipeline that is involved. Rather, the existing pipeline from Koropeje in Turkmenistan to Kordkuy in Iran will have additional compressor stations installed in order to increase its carrying capacity. On the Turkmenistan side, the existing pipeline will be extended to the Dauletabad field to provide for increased quantities, and it will be extended to Khangiran on the Iranian side to provide for increased processing capacity. The construction involved in extending the pipeline Iranian side is projected to take up to two years to execute.

The figure of 20 bcm/y that has more than once appeared in Western commentaries and analyses appears to be based on the supposition that this is a new (parallel) pipeline. It is not; it is an extension of an existing pipeline. In fact, the figure available in the specialized industry press for the capacity of the "new" pipeline is up to 14 bcm/y.

Since actual recent exports through the Korpeje-Kordkuy pipeline are reported in the range of about 6 bcm/y (despite a theoretical maximum capacity of 8 bcm/y), adding that figure to the potential exports of a "new" pipeline, if one existed, could account for the figure of 20 bcm/y. But as this clarification should make clear, that is not the case; moreover, it will take at least two years for the expanded volume to reach planned capacity. In the event, for technical reasons, the total annual export is likely to be closer to 12 bcm/y than 14 bcm/y; and that will take several years to accomplish, assuming the Iran is successful in its intention to extend the pipeline on its own side.

Construction of the East-West Pipeline will contribute to the ongoing unification of Turkmenistan's gas supply system, which has been under way, generally unremarked, for some time. Yet the consequences are considerable. In particular: with the additional planned construction of a connection between Dauletabad and the new South Yolotan-Osman field, it will become possible for Turkmenistan, merely by opening and closing the proper valves, to switch export quantities and export directions among north (Kazakhstan, Russia), south (Iran, Afghanistan, Pakistan, India), east (Uzbekistan, Kazakhstan, China), and west (Azerbaijan, Georgia, Turkey, Europe).

Central Asia-Caucasus Institute Research Director Svante Cornell was among the int’l energy experts who spoke at Thursday’s Washington Energy Summit....

WASHINGTON, DC – Friday, September 24, 2010 – The emergence of Central Asia as a major oil and gas producer has been a welcome development in the realm of energy in the past twenty years, analysts said Thursday during the Washington Energy Summit in Washington, DC.

The development of energy reserves from nations located around the Caspian basin has been one of the most important changes in the last two decades, noted Central Asia-Caucasus Institute Research Director Svante Cornell.

It has allowed oil-consuming countries “to diversify their import sources” by increasing their choices of oil sellers, while simultaneously allowing producer nations, like Kazakhstan and Turkmenistan, “to diversify their exports.”

“Central Asia can work further to diversify their [energy] exports if they have long-term plans,” he said.

Another benefit to the emergence of Central Asia on the global energy scene lies in its geography, Cornell noted.

“The Central Asian republics are located near energy consumers” like Russia and China, which makes the transportation of fuel to customers easier and allows Central Asian producers to export more, he added.

What is also significant is the “openness of Caspian-basin nations to investments from international oil companies,” Cornell noted, saying that the cooperation between national oil companies and the international giants presented a new method of handling national oil wealth.

The Caspian basin region also offers attractive conditions for international investors, said Heritage Foundation Senior Research Fellow Ariel Cohen.

“The rule of law and protection of assets is important” for international oil companies to consider, he said. In the Caspian region and Central Asia, “the political risk is low, even if it is geographically difficult” to extract the fuels.

The biggest question in the region is the future of resource development in Turkmenistan, analysts said.

The amount of gas resources in Turkmenistan have not been quantified for as long as other nations in the region and the country’s energy relations with regional gas giant, Russia, have been testy.

Russia’s Gazprom is reported to have spread rumors about the lack of quality of Turkmenistan’s reserves, Cornell said. Russia also shut off valves shortly before Turkmenistan built a gas pipeline that would provide China with 30-40 bcm of gas per year.

“Now, Turkmenistan is going to exclude Gazprom from the construction of its East-West pipeline,” Cornell said, adding that Turkmen president Gurbanguly Berdimuhamedov recently excluded Russia from a list of potential gas customers that also included China, Europe and Iran.

Turkmenistan’s gas reserves are estimated to be 7 trillion cubic meters, the fifth-largest in the world.