The Clinton administration had been working with the Taliban from 1994 forward. Why? Because some companies (particularly UNOCAL and Saudi owned Delta) wanted "to build a pipeline from Turkmenistan to Pakistan through Afghanistan." ... "so that the vast untapped oil and gas reserves in the Central Asian and Caspian region could be transported to markets in South Asia, South-East Asia, Far East and the Pacific" ( How America Courted the Taliban). This is supported by Jon Flanders 2001 article. While official relations were purportedly broken off in 1998, relations with the Taliban were maintained through the State Department (Ahmad) and through the Pakistan Military Intelligence ISI by the CIA (Chossudovsky).

According to Jon Flanders (2001), U.S. interest in the pipeline restarted in 2000, but was still not moving forward when Bush was elected. With Bush came Cheney (CEO of Halliburton) and Halliburton had investments in Turkmentistan for "integrated drilling services with an estimated value of $30 million for the total package."

It should not be surprising given the oil interests of the President, his kin, and his appointees, that Bush placed Afghanistan on the top of his action list. In July 2001, Colin Powell gave the Taliban $43 million for "humanitarian aid" (Madsen, 2002).

Between the 1960s and mid-1980s, the Soviets had identified more than 15 oil and gas fields in northern Afghanistan. Only three gas fields -- Khwaja Gogerdak, Djarquduk, and Yatimtaq – were developed in the area surrounding Sheberghan, which is located about 120 kilometers west of Mazar-i-Sharif. Afghan natural gas production reached 275 million cubic feet per day (Mmcf/d) in the mid-1970s. The Djarquduk field was brought online during that period and boosted Afghan natural gas output to a peak of 385 Mmcf/d by 1978. About 100 mmcf/d of this amount was used locally in gas distribution systems in Sheberghan and Mazar-i-Sharif as well as at a 100,000 mt/y urea plant located near Mazar-i-Sharif. One oil field, Angot, was developed in the late 1960s, but aside from production tests, oil production was intermittent, with daily outputs averaging 500 b/d or less.

Northern Afghanistan has proved, probable and possible natural gas reserves of about 5 trillion cubic feet (Tcf). This area, which is a southward extension of the highly prolific, natural gas-prone Amu Darya Basin, has the potential to hold a sizable undiscovered gas resource base, especially in sedimentary layers deeper than what were developed during the Soviet era. Afghanistan’s crude oil potential is more modest, with perhaps up to 100 million barrels of medium-gravity recoverable from Angot and other fields that are undeveloped. Afghanistan also may possess relatively small volumes of gas liquids and condensate.

Given the obstacles to development of a natural gas pipeline across Afghanistan, it seems unlikely that such an idea will make any progress in the near future, and no major Western companies have expressed interest in reviving the project. The security situation in Afghanistan remains an obvious problem, while tensions between India and Pakistan make it unlikely that such a pipeline could be extended into India and its large (and growing) gas market. Financial problems in the utility sector in India, which would be the major consumer of the natural gas, also could pose a problem for construction of the TAP line. Finally, the pipeline's $2.5-$3.5 billion estimated cost poses a significant obstacle to its construction.

The CPC was founded in 1992. Equity interest is: Russia, 24 percent; Kazakhstan, 19 percent; Oman, 7 percent; Chevron, 15 percent; LUKARCO, 12.5 percent; Rosneft-Shell, 7.5 percent; Mobil, 7.5 percent; Agip, 2 percent; British Gas, 2 percent; Kazakhstan Pipeline Ventures, 1.75 percent; Oryx, 1.75 percent.

The major shareholders in the consortium include Russia (24 % of the shares), Kazakhstan (19 %) and Oman (7 %). The main private shareholders are Chevron Caspian Pipeline Consortium (15 %) and LUKArco (12.5 %).

Caspian Pipeline Consortium

While in Russia in October of this year, U.S. Commerce Secretary Don Evans joined government and business leaders to welcome the announcement that the first tanker loaded with oil from the Caspian Pipeline Consortium departed the port of Novorossiysk. "It tells the world that the United States, Russia, and Central Asian states are cooperating to build prosperity and stability in this part of the world," Evans said.

The Caspian Pipeline Consortium (CPC) is a $2.6 billion project consisting of a 935-mile crude oil pipeline that runs from the Tengiz oil field in Kazakhstan to the Russian Black Sea port of Novorossiysk. Construction on the CPC pipeline began in 1999. It is a key East-West pipeline that will carry oil from the Caspian Sea region to international markets.

The CPC project is the largest, single United States investment in Russia. U.S. companies, including ChevronTexaco and ExxonMobil, have contributed nearly one-half of the $2.6 billion investment.

Initial capacity of the pipeline will be over 500,000 barrels per day, and is expected to reach to about 1.4 million barrels per day by 2015.

The CPC project advances the Administration's National Energy Policy by diversifying our States energy supply (thereby enhancing our energy security) and by supporting global economic growth. It also highlights the Caspian-region countries' progress towards establishing a transparent and stable environment for international trade and investment.

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Statement by the President

I congratulate Russia, Kazakhstan, and Oman, and their consortium partners, for the commissioning of the Caspian Pipeline Consortium (CPC). U.S. firms, notably ChevronTexaco and ExxonMobil, have played leading roles in this project. These facilities represent the culmination of years of effort. They are examples to the world that the United States, Russia, and Kazakhstan are cooperating to build prosperity and stability in this part of the world.

The CPC highlights the important progress by countries in the Caspian region in building a transparent and stable environment for international trade and investment. The CPC project also advances my Administrations National Energy Policy by developing a network of multiple Caspian pipelines that also includes the Baku-Tbilisi-Ceyhan, Baku-Supsa, and Baku-Novorossiysk oil pipelines and the Baku-Tbilisi-Erzurum gas pipeline. These projects will help diversify U.S. energy supply and enhance our energy security, while supporting global economic growth.

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