ForAssamnetters- particularly those with a flair for Global Scale Engineering
--and those interested in the history of bold Soviet Planning not fully
executed yet:The Volga-Don Ship Canal ----
To: [EMAIL PROTECTED]: [EMAIL PROTECTED]: [EMAIL PROTECTED]: Mon, 25 Jun 2007
20:48:44 +0000Subject: [WaterWatch] RIVAL CASPIAN CANAL PROJECTS COMPETE FOR
INVESTORS
Note: Is it a coincidence that similar projects are being planned world
over?This projects are akin to replumbing the planet. Is it sane? Does present
human knowledge really permit this? Will future knowledge approve of it? RIVAL
CASPIAN CANAL PROJECTS COMPETE FOR INVESTORSAzerbaijan, one of the rising
Caspian energy exporters, has dismisseda Russian proposition to renovate the
Volga-Don Canal (Itar-Tass, June19). Baku apparently favors a Kazakh proposal
for a "Eurasia Canal,"calling Russia's plans a simple upgrade of the existing
canal.Speaking in Rostov-on-Don on June 15, Russian First Deputy PrimeMinister
Sergei Ivanov told journalists that Kazakhstan, Azerbaijan,and Turkmenistan
might be interested in participating in the secondphase of the Volga-Don Canal,
"Because, if this line is built, thecanal's throughput capacity would be
increased, and these countriescould become maritime powers" (Interfax, June
15). Ivanov continued,"The idea of concessions is very attractive…" (Azeri
Press Agency,June 16), adding, "Private capital, including foreign private
capital[could be involved]," as "the federal budget will never fund it
100%.This project needs the participation of foreign investment"(RIA-Novosti,
June 15). Ivanov's remarks support Russian PresidentVladimir Putin's earlier
proposals, first made in April, to upgradethe canal (Interfax, April 26).The
Volga-Don Canal is the least known of the world's strategicwaterways, but it
provides a maritime link between the Volga River,which empties into the Caspian
Sea, and the Don River, which disgorgesinto the Sea of Azov, a northeast
corollary of the Black Sea, which inturn provides access via the Turkish
Straits to the Mediterranean. Thepotential of the project is enormous, as it
ultimately connects theBaltic, the Mediterranean, the Caspian, and the south of
Russia viaRussia's inland waterways with the European Union's 9th
InternationalTransport Corridor. Like many Russian infrastructure
upgrades,however, Moscow is currently looking for someone else to pay the
bulkof the cost.The canal issue is mired in complex geographical and
strategicconcerns, including the eventual settlement of the status of
Caspianoffshore waters, at topic that has bedeviled littoral states
Russia,Iran, Azerbaijan, Kazakhstan, and Turkmenistan since the collapse ofthe
USSR in 1991.The Ottoman Turks first mooted the idea of a waterway linking the
twogreat Eurasian riverine basins in the late 16th century. Peter theGreat was
also interested in a channel connecting the two rivers, buthis vision was never
fulfilled. Stalin subsequently used Gulag laborto realize the centuries-old
dream in 1952. Its completion wouldinspire Soviet composer Sergei Prokofiev's
"The Meeting of the Volgaand Don" tone poem.The Volga-Don Canal begins roughly
220 miles upstream fromRostov-on-Don and transits approximately 37 miles
between the Don andVolga Rivers, emptying into the Volga near Volgograd. The
canal beginsat the Volga's Sareptsky and ends in the Don's Tsimlyansk
Reservoir,and consists of nine one-chamber canal locks capable of handling
shipsup to 5,000-tons. The canal's current carrying capacity is 16.5million
tons of cargo per year, while the alternative Eurasia Canalcould potentially
carry up to 45 million tons annually. Neitherproject would be inexpensive;
experts estimate that either canal wouldcost at least $5 billion.Despite
Moscow's blandishments the Azerbaijani government has yet tosign on to the
project, however. According to Azerbaijani TransportMinister Zia Mamedov, "At
this stage we see our participation in theproject only as a carrier," adding,
"new transport routes areprofit-making, and the main thing is their
competitiveness.(Itar-Tass, June 19).The reticence of the Azerbaijani
government to participate in theproject may well stem from the fact that in the
early 1990s, when Bakuwas developing its offshore oil facilities, Russia
charged what Bakuconsidered to be extortionate rates for Western shipments
using theVolga-Don canal to bring advanced offshore drilling technology intothe
Caspian to develop offshore Azerbaijani oil fields. In 1994Houston-based
Independent Marine Consultants utilized the Volga-DonCanal to transship a
number of compressors for a pipeline being builtby Pennzoil in Azerbaijan's
offshore Guneshli oil field, about whichIMC Marine Group president Prasad Menon
said diplomatically, "It wasvery complicated and
difficult"(http://permanent.access.gpo.gov/lps3997/9802volg.htm).Russia has
also kept tight control over transit through the Volga-DonCanal. Last year
Azerbaijan's Caspian Shipping Company, which owns 72ships, received 25 permits
for the passage of 14 vessels via Russianinternal waterways, with 11 permits
for passage into the Caspian and15 for exit. Twenty-two permits have been
issued so far this year(http://capital.trendaz.com, June 11).Nor is the
Volga-Don Canal project the only one on the drawing boardsfor improving Caspian
maritime access. On June 10 Kazakh PresidentNursultan Nazarbayev proposed an
alternative "Eurasia Canal"connecting the Caspian and Black Seas. Nazarbayev
proposes building analmost straight canal utilizing Soviet-era navigable
reservoirs acrossRussia's North Caucasus, which would shorten shipping routes
by nearly600 miles (Kazinform, June 10). According to Nazarbayev, "The
CentralAsian and Caspian regions are rich in energy resources...but
thesereserves have to be delivered to world markets… [the new canal] wouldbe a
powerful corridor providing an outlet for the whole of CentralAsia to the sea
via Russia….We have heard some of our Russiancolleagues say that Kazakhstan
will bypass Russian territory. But wewill not bypass anyone. We are searching
for routes that will benefitexports and Kazakh products. I say to Russia: let
us build a canal! Itcarries a price tag of $6 billion. But we will have no
difficultyfinding investors." He emphasized that the project is currently just
a"proposal" (Interfax Presidential Bulletin, June 15).Azerbaijan's reluctance
to participate in Russia's ambitious projectmay well derive from its unhappy
experience in Moscow's earlier fiscalbrutality. An upgraded Volga-Don Canal
would, under international law,always be a Russian internal waterway, and any
shipments using the newcanal would still be subject to Ankara's control of the
TurkishStraits well before Azerbaijani transports reached the
Mediterranean.Given that the Baku-Supsa and Baku-Tbilisi-Ceyhan pipelines are
nowoperational, Baku's professed interest in the new route as a "carrier"is the
most pragmatic interim option, as its energy exports can nowreach global
markets without paying Russian tariffs.By John C.k. DalyJune 25, 2007Eurasia
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