Replies to post #979 on Foreign Correspondence

[Amaunet]

ChevronTexaco, intends to invest up to $10 billion in Russia.



US oil giant plans to invest in Russia

16:23 2004-07-06
One of the world's largest oil corporations, ChevronTexaco, intends to invest up to $10 billion in Russia. The news was announced in a statement from the Russian Industry and Energy Ministry, Izvestia reports. Last Friday, Energy Minister Viktor Khristenko met the US company's CEO, David O'Reilly. The meeting passed inconspicuously, but the results are a good example of the new rules that are to be applied to the Russian oil business from now on. Decisions are to be made by investors and the government, and then the government will make the relevant announcement. So far, Chevron's presence in Russia has been a modest (in energy terms) one billion dollars invested in the Caspian pipeline consortium. An even more modest $50 million, which was invested in a production sharing agreement with ExxonMobil in Sakhalin 3, was lost after a government committee annulled the results of a 1993 tender in January 2004.

The international investment community simply wants to see oil companies doing business in Russia, Izvestia points out. The Russian government does not oppose this. As Khristenko emphasised at the meeting, doubling the country's GDP would be impossible without foreign investment. According to him, efficient use of this investment (particularly ChevronTexaco's) could positively influence not only the fuel and energy sphere, but also the Russian economy on the whole.

ChevronTexaco's official reaction reads as follows, "We are considering the possibility of investing from $5 to 10 billion in the Russian energy sphere as soon as we have the opportunity." The opportunity may appear very soon, the newspaper points out. Moreover, there could be many of them. The first real one will be in the third quarter of 2004 when the government will sell 7.59% of its shares in LUKoil.


http://newsfromrussia.com/world/2004/07/06/54789.html

[CoalTrain]

Do you think this is accurate?

After dropping nearly 50 per cent from the Soviet era peak, Russia's oil output has soared again to exceed 450 million tonnes (together with gas condensates) by the end of the current year making it the world's second largest producer, behind only Saudi Arabia.

Total oil reserves are a state secret in Russia, but the former Energy Minister, Yuri Shafranik, estimates that Russia may have 44 billion tonnes of oil, more than Saudi Arabia does. Russia currently exports over 6.5 million barrels a day, taking crude oil and product together, and plans to boost exports to about 9 million barrels a day by the end of the decade -- roughly equal to Saudi Arabia's current exports.

Russia is also the number one producer of natural gas in the world and has the biggest share -- 32 per cent -- of global reserves. Taken together, oil and gas make Russia the biggest energy producer in the world, and moreover, one of the few countries whose reserves are not shrinking yet.

[CoalTrain]

Unless these estimates are largely based on the production of the Caspian Sea oil I seriously underestimated Russians oil reserves. With this "energy card" the Russians will have the control the Saudis have only unlike the Saudis we cannot push them around militarily. If the Russians can control shocks to our oil supply, they can to a very large degree control our economy. This would explain a lot of things. France and Germanys co-operation with the Russians among others.


This brings a couple of question into my mind.

How long before these reserves turn into real market share that the Russians can use as a economic weapon?

What kind of military posturing has been done around in the ground Uranium reserves?

If Russia has control of the lions share of the oil reserves how will this tip the balance of power in South America?

I am not sure I get your point about Russia not having enough people in the countryside? Who but the Chinese would be able to march a human Army into Russia in great enough numbers to do much?

There is a large pipeline in Ukraine that was finished a few years ago and moves no oil or gas. Do you know why?

[Amaunet]

New Cold War With Russia Looms in Middle East
Commentary, Franz Schurmann,
Pacific News Service, Jul 09, 2004

Editor's Note: Relations are souring between the United States and Russia, largely due to competing strategic interests in Central Asia and the Middle East.

When the new American ambassador to Iraq, John Negroponte, announced he was going to expand the embassy staff tenfold, Cold War scholars couldn't help but remember how 50 years ago the United States shifted its small Hong Kong consulate to a mansion that over the years kept expanding both in acreage and personnel. Could we now be seeing the beginning of a new Cold War, but this time in the Middle East?

The Hong Kong consulate did much more than hand out visas. Its personnel consisted not only of "China experts" but experts in the vast regions of Northeast and Southeast Asia. The Hong Kong consulate was, in effect, an early form of a think-tank that was taken very seriously by the White House. Fifty years later, the Baghdad Embassy seems to be the Middle East reincarnation of the Hong Kong consulate.

President Bush keeps on using the term, the "Greater Middle East" (GME). It includes all Arab countries but also Afghanistan, Iran, Pakistan, Turkey and Israel. Even though the great bulk of the GME population is Sunni and Shiite,
the term avoids the word Islamic. Until the Shah was overthrown in 1978, Turkey, Iran and Pakistan were linked into a regional military alliance called the "Central Treaty Organization,"(CENTO). CENTO was the middle link in a chain that began with NATO in Europe and ended with SEATO (SouthEast Asia Treaty Organization) in East Asia. The purpose was containment of the two Communist giants, Russia and China.

The U.S.-created CENTO in 1954 was also called the "Baghdad Treaty Organization." Though CENTO had only three members, all American allies, it had clout over the same strategic territory that the GME covers. It's clear that Bush, with his vision of a GME, has extended a protective umbrella over the entire Middle East. But who is now the threatening enemy?

In the CENTO days it was the Soviet Union. The American diplomat and Russia-expert George Kennan, writing under the name "Mr. X," (Foreign Relations of the United States, 1946, vol. VI) portrayed the Soviet Union as having its sights set on the Middle East.

Now the U.S. might be looking askance at Russia again. Not only have American-Russian relations soured lately, but President Putin wants to get American military bases out of Central Asia. Specifically, he has in mind the Hanabad base in Uzbekistan and the Bishkek-Manas base in Kyrgyzstan. In the earlier phases of the Afghanistan war, when his country was faced with terrorist attacks, Uzbekistan strongman Islam Karimov welcomed the American bases.

But now Karimov sees that Putin is determined to restore a new, great Russia. Near Uzbekistan is another great power, China, which despite good relations with the United States has always opposed American bases in Central Asia.

Scholars diverge about when the Cold War began. Some say it began when Truman succeeded President Roosevelt in 1945 and a few weeks later roasted Soviet Foreign Minister Molotov during his visit to Washington. Others point to two momentous events in 1949. First came the Soviet detonation of an atomic device on August 29, and then on October 1 the victorious Chinese Communists proclaimed the People's Republic of China.

America and Russia have already crossed the roasting stage. When victory in Afghanistan seemed imminent, Bush invited Putin to Crawford Ranch to celebrate their joint victory. But he was unhappy when it became clear that Putin had broken his promise to keep the Russian-supported Northern Alliance out of the Afghan capital, Kabul. He showed his displeasure by taking Putin to a Crawford high school, where they exchanged jokes with students.

It looks like both sides are now in the second stage of the new Cold War. The American media give accounts of the return to authoritarianism and the waning of democracy in Russia. The Russian media keep vilifying Bush about Iraq. In Afghanistan rumors are flying about American officials talking with "moderate Talibans." The Russians are worried that the ethnic groups they supported, who made up the Northern Alliance and now dominate the Afghan government, could lose power. For Russia that would mean another defeat in Afghanistan.

But while American-Russian relations are rocky, there are no dramatic events like those of 1949 on the horizon. In the 1950s the Cold War avoided a nuclear war between the two superpowers. But the real result of the Cold War was a lineup of the countries behind the two superpowers. Britain, France, Pakistan, Iran and Israel were behind the USA. China and North Korea lined up with the Soviet Union.

The Bush team has been using the controversy about "Weapons of Mass Destruction" to figure out which countries support America. Russia is now looking for supporters as well. They are proposing joint maneuvers with the Chinese. Two years ago, Russians held maneuvers with the Americans. Now Russians are the chief weapons purveyors of the Chinese and Indians.

But most ominous are the close relations between the Russians and the Iranians. The Russians support Iran's position about their nuclear energy program. The world should pray that the there not be another year like 1949, which was followed by the Korean war.

PNS Editor Franz Schurmann ([e-mail]) is emeritus professor of history and sociology at U.C Berkeley and the author of numerous books.

http://news.pacificnews.org/news/view_article.html?article_id=ed5bd3c0c9b654f3be9ae53c8fbd481c