by Ahmed Rashid
‘The strategy is to take advantage of the extensive, existing pipeline network to extend the entire regional system to the coast allowing producers of Russia, Kazakhstan, Uzbekistan and Turkmenistan to access the growing markets of Asia. There would be a commerce corridor across Central Asia,’ said Robert Todor, Unocal's Executive Vice-President.8 To avoid a repetition of Chevron's problems with Russia in Kazakhstan, Unocal wooed Moscow from the start. Russia's Siberian oil would have a new southern outlet to the sea, while Gazprom had a stake in the gas pipeline. ‘We don't have a Russian problem just an Afghan problem. For everyone it's a win-win situation,’ Henry De La Rosa, Unocal's manager in Turkmenistan told me.9
The Clinton administration and Unocal's sudden interest in Turkmenistan and Afghanistan was not accidental. It was preceded by a significant change in US policy towards Central Asia. Between 1991 and 1995 Washington had strategically supported Kazakhstan and Kyrgyzstan as the two states which would swiftly bring about economic and political liberalization, thereby making it easier for US companies to invest there. Kazakhstan still held nuclear weapons left over from the Soviet era and with huge oil, gas and mineral reserves Kazakh President Nursultan Nazarbayev was personally courted by Presidents Bush and Clinton. But by 1995 Nazarbayev was increasingly seen as a failure, as massive corruption riddled his administration and he became increasingly dictatorial.
Kazakhstan had surrendered its nuclear weapons to Russia by 1993 and with 40 per cent of its population made up of ethnic Russians, who were openly hostile to the government, Nazarbayev was forced to bend to Russia's security and economic demands. For four years Kazakhstan was unable to persuade Russia to allow Chevron to transport Tenghiz oil through Russian pipelines to Europe. A frustrated Chevron, which in 1991 had promised to invest US$5 billion in Tenghiz had cut back its commitment and had invested only US$700 million by 1995.10
During this period (1991–95) the USA ignored Tajikistan which was involved in a civil war, while Uzbekistan and Turkmenistan, ruled by two dictators, were considered beyond the pale by the US State Department. Moreover, with the Russo-centric Deputy Secretary of State Strobe Talbott in the driving seat of US policy towards the FSU, Washington was not keen to antagonize Moscow and challenge its abiding interests in Central Asia. Talbott's agenda was to enlist Russia in NATO and not create problems in USRussia relations by encroaching on Russia's backyard.
However, as Russia slipped into chaos, Talbott's pro-Russian policy came under bitter attack from within the US foreign policy establishment, the Jewish and Israeli lobbies in Washington and US oil companies, who all wanted the US to embrace a more multi-dimensional foreign policy towards the FSU. One that would allow them to exploit the Caspian's resources, help the Caspian states assert their independence from Russia and enlist them in the Western camp. US oil companies, who had spearheaded the first US forays into the region now wanted a greater say in US policy-making.
In early 1995, major US oil companies formed a private Foreign Oil Companies group in Washington to further their interests in the Caspian. The group included Unocal and they set about hiring former politicans from the Bush and Carter era to lobby their case in Washington.11 The group met with Sheila Heslin, the energy expert at the National Security Council (NSC) and later in the summer of 1995 with her boss, the NSC Adviser Samuel Berger. Berger had set up an inter-agency government committee on formulating policy towards the Caspian, which included several government departments and the CIA.12
The strategic interest of Washington and the US oil companies in the Caspian was growing and Washington began to snub Russia. The immediate beneficiaries were Uzbekistan and Turkmenistan. Washington had scotched one attempt by US lobbyists to promote Niyazov. In March 1993, a former NSC Adviser, Alexander Haig had been hired by Niyazov and brought him to Washington to try and persuade US companies to invest in Turkmenistan and soften the US position on pipelines through Iran. The visit was a failure and Niyazov was unable to meet US leaders. But by 1995 Washington realized that if it kept Niyazov at arm's length, he would have no choice but to fall back on Iran. Turkmenistan's economic plight was worsening due to its inability to sell its gas. For the USA the prospects of a gas pipeline through Afghanistan was not only attractive because it avoided Iran, but it would signal support to Turkmenistan, Pakistan and the Taliban while clearly snubbing Russia and Iran.
The USA could not develop strategic clout in Central Asia without Uzbekistan, the largest and most powerful state and the only one capable of standing up to Russia. Both cautiously wooed each other. Karimov became supportive of NATO plans to build a Central Asian NATO battalion, a move that was vehemently opposed by Russia. ‘We don't accept NATO in our backyard. The US must recognize that Central Asia will remain within the “near abroad” – Russia's sphere of influence,’ an angry Russian diplomat told me in Ashkhabad in 1997.13 US companies took an interest in Uzbekistan's mineral deposits, and trade between Uzbekistan and the USA suddenly blossomed, increasing by eight times between 1995 and 1997. Karimov made his first trip to Washington in June 1996. ‘By late 1995 the West, and most notably the US, had clearly chosen Uzbekistan as the only viable counterweight both to renewed Russian hegemonism and to Iranian influence,’ wrote Dr Shireen Hunter.14
Thus there were the makings of two coalitions emerging in the region. The US lining up alongside Uzbekistan, Turkmenistan and Azerbaijan and encouraging its allies Israel, Turkey and Pakistan to invest there, while Russia retained its grip on Kazakhstan, Kyrgyzstan and Tajikistan. The USA was now prepared to confront Russia as the battle for the Caspian's resources escalated. ‘While US policy-makers certainly do not want to see a hegemonic Russia, the potential costs of such hegemony become far greater if Russia is able to dictate the terms and limit Western access to the world's last known oil and gas reserves. Even minimum US involvement here provides for maximum Russian suspicion,’ said Dr Martha Brill Olcott, a leading US academic on Central Asia.15
I did not begin to investigate this unfolding story until the summer of 1996. The sudden capture of Kabul by the Taliban in September 1996 prompted me to try and unravel two unanswered questions which many Western journalists were grappling with, but failed to answer. Were the Americans supporting the Taliban either directly or indirectly through Unocal or their allies Pakistan and Saudi Arabia? And what was prompting this massive regional polarization between the USA, Saudi Arabia, Pakistan and the Taliban on one side and Iran, Russia, the Central Asian states and the anti-Taliban alliance on the other? While some focused on whether there was a revival of the old CIAISI connection from the Afghan jihad era, it became apparent to me that the strategy over pipelines had become the driving force behind Washington's interest in the Taliban, which in turn was prompting a counter-reaction from Russia and Iran.
But exploring this was like entering a labyrinth, where nobody spoke the truth or divulged their real motives or interests. It was the job of a detective rather than a journalist because there were few clues. Even gaining access to the real players in the game was difficult, because policy was not being driven by politicians and diplomats, but by the secretive oil companies and intelligence services of the regional states. The oil companies were the most secretive of all a legacy of the fierce competition they indulged in around the world. To spell out where they would drill next or which pipeline route they flavoured, or even whom they had lunch with an hour earlier, was giving the game away to the enemy rival oil companies.
Bridas executives never spoke to the press and only issued very occasional statements from a discreet public relations company in London. Unocal was more approachable but their executives were primed to give bland answers which gave nothing away. But there was a marked difference between the two companies which was to affect their future relations with the Taliban. Bridas was a small family company whose executives, brought up in the European tradition, were interested in the politics, culture, history and the personal relations of where and with whom they were dealing. Bridas executives w
ere knowledgeable about all the convolutions of the Game and they took the trouble to explore the ethnic, tribal and family linkages of the leaders they were meeting.
Unocal was a huge corporation which hired executives to run its global oil business. Those sent out to the region were, with a few exceptions, interested in the job rather than the political environment they were living in. While Bridas engineers would spend hours sipping tea with Afghan tribesmen in the desert as they explored routes, Unocal would fly in and out and take for granted what they were told by the notoriously fickle Afghan warlords. Afghans had long ago mastered the art of telling an interlocuter what he wanted to hear and then saying exactly the opposite to their next guest. Unocal was also at a disadvantage because its policy towards the Taliban did not deviate from the US line and consequently Unocal lectured the Taliban on what they should be doing. Bridas had no such compunctions and was ready to sign a deal with the Taliban, even though they were not recognized as the legitimate government by any state.
Unocal tended to depend more on the US Embassy in Islamabad, and Pakistani and Turkmen intelligence for information on what was happening or about to happen, rather than gathering their own information. As my stories were published on the Bridas-Unocal rivalry and the twists and turns of the new Great Game, both companies at first thought I was a spy, secretly working for the other company. Unocal persisted in this belief even after Bridas had realized that I was just a very curious journalist who had covered Afghanistan far too long to be satisfied with bland statements. It took me seven months of travelling, over one hundred interviews and total immersion in the literature of the oil business – of which I knew nothing – to eventually write the cover story for the Far Eastern Economic Reviewwhich appeared in April 1997.
In July 1997 Strobe Talbott gave a speech that was to become the benchmark for US policy in the region. ‘It has been fashionable to proclaim, or at least to predict, a replay of the “Great Game” in the Caucasus and Central Asia. The implication, of course, is that the driving dynamic of the region, fuelled and lubricated by oil, will be the competition of the great powers. Our goal is to avoid, and actively to discourage, that atavistic outcome. Let's leave Rudyard Kipling and George McDonald Fraser where they belong – on the shelves of history. The Great Game which starred Kipling's Kim and Fraser's Flashman was very much of the zero-sum variety.’
But Talbott also knew the Game was on and issued a grim warning to its players, even as he declared that Washington's top priority was conflict resolution. ‘If internal and cross-border conflicts simmer and flare, the region could become a breeding ground of terrorism, a hotbed of religious and political extremism and a battleground for outright war.’16
On the ground, Niyazov's decision to sign with Unocal infuriated Bulgheroni. In February 1996 he moved to the courts, filing a case against Unocal and Delta in Fort Bend County, near Houston Texas. Bridas demanded US$15 billion in damages alleging ‘tortuous interference with prospective business relations’ and that ‘Unocal, Delta and [Unocal Vice-President Marty] Miller and possibly others engaged in a civil conspiracy againt Bridas.’ In its court deposition, Bridas said it had ‘disclosed to Miller its strategic planning for the pipeline construction and operation. Bridas invited Unocal to consider joining a joint venture arrangement’.17In short, Bridas charged Unocal with stealing its idea.
Later, Bulgheroni explained how he felt. ‘Unocal came to this region because we invited them. There was no reason why we and Unocal could not get together. We wanted them in and took them with us to Turkmenistan,’ he told me. ‘In the beginning the US considered this pipeline a ridiculous idea and they were not interested in either Afghanistan or Turkmenistan,’ he added. Bridas also began arbitration against Turkmenistan with the International Chamber of Commerce for breach of contract in three separate cases regarding Turkmenistan's blockade of its Yashlar and Keimir fields.
Unocal maintained that its proposal was different because it involved Daulatabad rather than Yashlar gas field. In a letter, later submitted to court, John Imle, President of Unocal, had written to Bulgheroni saying that Turkmenistan had told him that the government had no agreements with Bridas, so Unocal was free to do what it liked.18 ‘We maintained that the CentGas project was separate and unique from Bridas. We were proposing to purchase gas from existing natural gas reserves and to transport the gas through an export gas pipeline. Bridas was proposing to transport gas from their Yashlar field … the CentGas project does not prevent Bridas from developing a pipeline to transport and market its own gas,’ said Imle.19
The Clinton administration now weighed in on behalf of Unocal. In March 1996 the US Ambassador to Pakistan Tom Simmons had a major row with Bhutto when he asked her to switch Pakistan's support from Bridas to Unocal. ‘Bhutto supported Bridas and Simmons accused Bhutto of extortion when she defended Bridas. She was furious with Simmons,’ said a senior aide to Bhutto present in the meeting. ‘Bhutto demanded a written apology from Simmons, which she got,’ added a cabinet minister.20
During two trips to Pakistan and Afghanistan in April and August 1996, the US Assistant Secretary of State for South Asia Robin Raphel also spoke in favour of the Unocal project. ‘We have an American company which is interested in building a pipeline from Turkmenistan through to Pakistan,’ said Raphel at a press conference in Islamabad on 21 April 1996. ‘This pipeline project will be very good for Turkmenistan, for Pakistan and for Afghanistan as it will not only offer job opportunities but also energy in Afghanistan,’ she added. In August, Raphel visited Central Asian capitals and Moscow where she pitched the same message.
Open US support for the Unocal project aroused an already suspicious Russia and Iran, which became even more convinced that the CIA was backing the Taliban. In December 1996, a senior Iranian diplomat told me in hushed tones that the Saudis and the CIA had channelled US$2 million dollars to the Taliban – even though there was no evidence for such suspicions. But accusations multiplied on all fronts after the USA and Unocal committed several blunders.
When the Taliban captured Kabul in September 1996, Chris Taggert, a Unocal executive, told wire agencies that the pipeline project would be easier to implement now that the Taliban had captured Kabul – a statement that Unocal quickly retracted because it implied that Unocal flavoured a Taliban conquest. Just a few weeks earlier Unocal had announced it would give humanitarian aid as ‘bonuses’ to the Afghan warlords, once they agreed to form a joint council to supervise the pipeline project. Again the implication was that Unocal was ready to dish out money to the warlords.
Then, within hours of Kabul's capture by the Taliban, the US State Department announced it would establish diplomatic relations with the Taliban by sending an official to Kabul – an announcement it also quickly retracted. State Department spokesman Glyn Davies said the US found ‘nothing objectionable’ in the steps taken by the Taliban to impose Islamic law. He described the Taliban as anti-modern rather than anti-Western. US Congressmen weighed in on the side of the Taliban. ‘The good part of what has happened is that one of the factions at last seems capable of developing a government in Afghanistan,’ said Senator Hank Brown, a supporter of the Unocal project.21 Embarrassed US diplomats later explained to me that the over-hasty US statement was made without consulting the US Embassy in Islamabad.
But the damage done was enormous. Unocal's gaffes and the confusion in the State Department only further convinced Iran, Russia, the CARs, the anti-Taliban alliance and most Pakistanis and Afghans that the US-Unocal partnership was backing the Taliban and wanted an all-out Taliban victory – even as the US and Unocal claimed they had no favourites in Afghanistan. Some Pakistani cabinet ministers, anxious to show that the USA supported the Taliban and Pakistan's stance, leaked to Pakistani journalists that Washington backed the Taliban.
The entire region was full of rumours and speculation. Even the ever-neutral wire agencies weighed in with their suspicions. ‘Certainly the Taliban appear to serve the US policy of isolating
Iran by creating a firmly Sunni buffer on Iran's border and potentially providing security for trade routes and pipelines that would break Iran's monopoly on Central Asia's southern trade routes,’ wrote Reuters.22
Bridas still faced an uphill climb to ensure that they were still in the race. Its gas and oil fields in Turkmenistan were blocked. It had no agreement with Turkmenistan to buy gas for a pipeline and none with Pakistan to sell gas. With US and Pakistani support, the Taliban were now being courted by Unocal. Nevertheless Bridas continued to maintain its offices in Ashkhabad and Kabul, even though Niyazov was trying to force them out. ‘Bridas is out, we have given the Afghan pipeline to Unocal. Our government does not work with Bridas anymore,’ Murad Nazdjanov, Turkmen Minister for Oil and Gas told me in Ashkhabad.23
Bridas had one advantage with the Taliban. Bridas told them it did not need to raise finances for the project through international lending institutions, which would first demand an internationally recognized government in Kabul. Instead Bridas had set up TAP Pipelines, a 50–50 partnership with the Saudi company Ningarcho, which was extremely close to Prince Turki, the Saudi intelligence chief. Bridas said it could raise 50 per cent of the funding from the Saudis to build the Afghan portion of the pipeline and the rest from an international consortium it would put together, which would build the less risky Pakistan and Turkmenistan ends of the pipeline. ‘We will do a complete separation between our problems with the Turkmenistan government and the Afghan pipeline contract. We will make two consortiums, one to build the Afghan line and one to build the Pakistan and Turkmenistan ends of the line,’ said a Bridas executive.24 Bridas was thus offering to start work on the pipeline immediately, without preconditions. It only needed some agreement between the Afghan factions, but even that was to remain unobtainable.