Pipeline Politics

I am no expert on either petroleum resources or on geopolitics.

Because of an interest in international business and globalization, however, I have from time to time looked into the geopolitics of major pipelines. Here are some things that have made an impression:

• Even in the thick of the Cold War, major pipelines bringing Russian (then Soviet) natural gas to Western Europe got built and functioned pretty well.
• In early 2006, some of these pipelines became very contentious. With rising prices and a very cold winter in parts of Eurasia, the accusations flew with vengeance: Russia is witholding gas from Ukraine, Ukraine is tapping gas in excess of its allowance and starving Italy of its quota, and so on.
• Follwing the American-led invasion of Iraq, oil and gas pipelines have been favorite insurgent targets. Supply chains in that petroleum rich nation remain severly disrupted.
• Militant attacks in Nigeria -- including attacks on pipelines -- forces Royal Dutch Shell to close key producing fields in that country.
• In January 2006, militant groups attacked and disrupted a pipeline in India's northeast.
  

The lessons I take from these are the following:

• Pipelines work under hostile conditions if the conditions represent the checkmate-stalemate positions of cold (not hot) war.
• Pipelines are highly vulnerable targets subject to attacks by insurgents and militant groups.
• In times of energy crunch (such as the Eurasian deep freeze of 2006), agreements on supply schedules may be violated.

Given these, is the ambitious project of building a pipeline from Iran to India via Pakistan, crossing some highly volatile regions of Pakistan, a good idea? This question is especially important since the project cost is in the US $15 to 20 billion range. For that price tag, a country the size of India can easily create a massive program to wean a substantial part of India's economy from petroleum-based energy to biofuels and other alternative forms of energy.

It just seems a wise move to spend mega-dollars on something that will have lasting benefits, rather than on a project subject to intense geopolitical risks.

Nik Dholakia
University of Rhode Island
USA