from www.washingtonpost.com

Russia's Strike Shows The Power Of the Pipeline
By Steven Pearlstein
Wednesday, August 13, 2008; D01

It was surely not lost on Russia's bully in chief, Vladimir Putin, that the oil giant BP decided to shut down the pipeline that runs through parts of Georgia controlled by Russian troops. Indeed, that was one of the aims of the cross-border incursion.

Putin understands better than anyone that oil and gas are the source of Russia's resurgence as a military and economic power and his own control over the Russian government and key sectors of its economy. It is oil and gas that provide the money to maintain Russia's powerful military, along with a vast internal security apparatus and network of government-controlled enterprises that allow the president-turned-premier to maintain his iron grip on the levers of political and economic power.

A little pipeline history: It was just as Putin was coming to power in 1999 that an agreement was reached to create the Baku-Tbilisi-Ceyhan (BTC) pipeline. The project would allow Azerbaijan and its production partner, BP, to bypass Russia and transport their newly drilled oil instead through Georgia and Turkey to a port in the eastern Mediterranean.

Because of its control of the only pipeline system linking former Soviet republics with the West, Russia had been able to extract most of the profit from any oil and gas that these newly independent countries could produce. But with BTC, which had the active support of the U.S. and European governments, Russia would lose its monopoly chokehold, opening the way for Western oil companies to make multibillion-dollar investments in the energy-rich Caucasus states.

No sooner was BTC completed, however, than Western officials began exploring the possibility of other pipelines that could reach beyond Georgia and Azerbaijan to Turkmenistan, which was thought to have some of the world's largest gas reserves. Their interest was not only in "energy security" and the prospect of oil riches for Western energy companies, but also in promoting Western-style democracy and free-market capitalism in the former Soviet republics.

In time, much of their efforts focused on a $12 billion project known as Nabucco, named after the Verdi opera, that would take gas across the Caspian sea, through Georgia, Turkey, Bulgaria, Romania and Hungary, finally reaching a terminal near Vienna. With Europe already dependent on Russia for a quarter of its natural gas, and that number set to rise with construction of a new northern pipeline running under the Baltic Sea to Germany, European leaders were keen to find alternative sources of natural gas. The effort took on greater urgency in winter 2006 after Russia briefly cut off supplies in its gas-pricing dispute with Ukraine.

Nabucco also became a top priority of the Bush State Department -- in particular, of Matt Bryza, a deputy assistant secretary of state, and C. Boyden Gray, a Bush family confidante who was named a special envoy for Eurasian energy, who began actively courting the leaders of Azerbaijan.

Putin, quite correctly, viewed Nabucco as part of a larger campaign by Washington to contain and isolate Russia and limit the expansion of its burgeoning energy empire. With Gazprom, the state gas monopoly, Putin launched his own competing proposal called South Stream to build a new pipeline to the Caucasus.

Suddenly the Russians were offering to pay Turkmenistan and Azerbaijan multiples of what they had previously offered to secure long-term supply deals. They penned an agreement with Italy and its oil company, Eni, to build a pipeline that would run under the Black Sea from Russia to Europe and end up at the same Austrian terminal as Nabucco. And Russian officials offered highly favorable transit agreements, ownership shares and guaranteed gas supplies to secure transit agreements from Bulgaria, Serbia and Hungary.

To industry observers like Ed Chow, a senior fellow at the Center for Strategic and International Studies, Nabucco has always looked more like a diplomats' pipe dream than a viable economic project. Its promoters had not only failed to secure supply and transit agreements but also had yet to identify an oil company eager to champion the project and finance the pipeline. Now, with its successful military incursion, Russia has raised serious doubts in the minds of Western lenders and investors that a new pipeline through Georgia would be safe from attack or beyond control of the Kremlin.

What we've been reminded once again is that Vladimir Putin is perfectly willing to sacrifice the rule of law and the good opinion of others to protect the Russian empire and the energy monopoly that sustains it. The techniques he used to bring Georgia to heel, while more lethal and destructive, have the same thuggish quality as the techniques Putin uses to silence domestic opposition and to expropriate the energy assets of Yukos, Shell and BP.

For the United States and Europe, this ought to be sufficient warning about the folly of extending membership in NATO or the European Union to every one of Russia's neighbors, particularly when they are unwilling to back it up with military action.

But it also is a reminder of the futility of trying to co-opt Putin by offering him a seat at the G-7, membership in the World Trade Organization or the honor of hosting the 2014 Winter Olympics. We may not be willing to send troops to Tbilisi, but at the least we should be willing to deny Russian companies the right to raise capital on Western stock exchanges, extend their pipelines into Western markets or use their energy profits to buy up major Western companies.

Vladimir Putin thinks he has looked into the soul of the West and discovered that we need him more than he needs us. It's time to convince him otherwise.

© 2008 The Washington Post Company

not the first and not the last of the upcoming Age of Energy Wars. Unless we heed Gore and become a non-carbon based economy. I am not holding my breath.

What Global Warming?

May 14, 2008
Polar Bear to Be a Protected Species
By THE ASSOCIATED PRESS
Filed at 4:06 p.m. ET

WASHINGTON (AP) -- The Interior Department declared the polar bear a threatened species Wednesday, saying it must be protected because of the decline in Arctic sea ice from global warming.
Interior Secretary Dirk Kempthorne cited dramatic declines in sea ice over the last three decades and projections of continued losses. These declines, he told a news conference, mean the polar bear is a species likely to be in danger of extinction in the near future.
Kempthorne also said, though, that it would be ''inappropriate'' to use the protection of the bear to reduce greenhouse gases, or to broadly address climate change.
Reflecting views recently expressed by President Bush, Kempthorne said the Endangered Species Act was ''never meant to regulate global climate change.''
He said the decision to list the bear includes administrative actions aimed at limiting the impact of the decision on energy development and other climate related activities.
''This listing will not stop global climate change or prevent any sea ice from melting,'' said Kempthorne. He said he had consulted with the White House on the decision, but ''at no time was there ever a suggestion that this was not my decision.''
Kempthorne cited as support for his decision conclusions by the department's scientists that sea ice loss will likely result in two-thirds of the polar bears disappearing by mid-century.
Notwithstanding the secretary's disclaimers, this is the first time the Endangered Species Act has been used to protect a species threatened by the impacts of global warming. There has been concern within the business community that such an action could have far-reaching impact and could be used to regulate carbon dioxide.
Kempthorne proposed 15 months ago to investigate whether the polar bear should be declared threatened under the Endangered Species Act.
That triggered a year of studies into the threats facing the bear and its survival prospects at a time when scientists predict a continuing warming and loss of Arctic sea ice. The Arctic sea ice serves as a primary habitat for the bear and is critical to its survival, scientists say.
''The science is absolutely clear that polar bear needs protection under the Endangered Species Act,'' said Andrew Wetzler, director of the endangered species program at the Natural Resources Defense Council.
A decision had been expected early this year, but the Interior Department said it needed more time to work out many of the details, prompting criticism from members of Congress and environmentalists. Environmentalists filed a lawsuit aimed at forcing a decision and a federal court on April 29 set a May 15 deadline for a decision.


Hey wait...How do you protect a species from a threat that doesnt exist?