The Quest: Energy, Security, and the Remaking of the Modern World
Page 83
Here I owe special thanks and acknowledgment to Sue Lena Thompson, with whom I have worked to such great benefit over the years. She visualized and conceptualized the photo section. And I am grateful to her for the spirit and wisdom she brought, as she did to The Prize and Commanding Heights.
I thank Ginny Mason for the distinctive and superb maps, and Sean McNaughton for the excellent graphics. The images they created help bring the geography and numbers in the story to life. Keith Rushworth of IHS also helped much with maps. In terms of the manuscript, I thank Anthony Martinez, who worked with me early on in the research and helped lay out the direction; and Russ Burns and Matt Vredenburgh, who worked intensively on the documentation. Freda Amar joined just in time to be part of the final phase.
Jerre Stead, the chairman and chief executive officer of IHS, supported this project from the beginning and shared his perspectives and insight throughout. His leadership has brought IHS to its position at the crossroads of the global economy. At IHS, I would also particularly like to thank Scott Key, Mike Sullivan, Steve Green, Jane Okun Bomba, Jonathan Gear, and Dave Carlson, as well as Rich Walker and Ed Mattix.
At IHS CERA, I’m blessed with wonderful colleagues who every day, with great expertise, help paint the picture of energy in its global setting. I feel that all of them helped me in one way or another, and I’m grateful to all. I do want to thank those who read and critiqued all or substantial parts of the book or contributed in other very significant ways: Bhushan Bahree, James Burkhard, Thane Gustafson, David Hobbs, Peter Jackson, Lawrence Makovich, James Placke, Matt Sagers, Jone-Lin Wang, and K. F. Yan.
Other CERA colleagues who also contributed and helped me include: Atul Arya, Mary Barcella, Aaron Brady, Jean-Marie Chevalier, James Clad, Jackie Forrest, Tiffany Groode, Samantha Gross, Kate Hardin, John Harris, Bob Ineson, Ruchir Kadakia, Matt Kaplan, Rob LaCount, Jeff Marn, Thomas Maslin, Wolfgang Moehler, Gig Moineau, David Raney, Laurent Ruseckas, Susan Ruth, Enrique Sira, Leta Smith, Michael Stoppard, Xiaolu Wang, Irina Zamarina, and Xizhou Zhou.
I also want to thank the expert colleagues at the sister organizations, IHS Global Insight, IHS Jane’s, IHS Herold, and IHS Emerging Energy Research.
I would like to express appreciation to those who read parts of the manuscript and who contributed to my thinking and understanding: William Antholis, Nariman Behravesh, Christopher Beauman, Simon Blakey, Len Blavatnik, John Browne, Cai Jin-Yong, Jamil Dandany, John Deutch, Erica Downs, Charles Ebinger, Daniel Esty, Christopher Frei, John Fritts, David Goldwyn, Peter Gorelick, Todd Harvey, John Heimlich, Chris Hunt, Jack Ihle, Sultan al-Jaber, Jan Kalicki, Yoriko Kawaguchi, Doug Kimmelman, Pierre Lapeyre, Richard Lester, David Leuschen, Robert Maguire, Michael Makovsky, Ernest Moniz, Edward Morse, Ibrahim al-Muhanna, Moises Naim, Masahisa Naitoh, Kenneth Pollack, Peter Rose, Tyler Priest, David Rubenstein, Lee Schipper, Gordon Shearer, George Shultz, Frank Verrastro, Julian West, Mason Willrich, Barry Worthington, and Arthur Yan.
I would also like to thank Strobe Talbott and the Brookings Institution, for the opportunity to participate in the Energy Security Initiative and chair the Energy Security Roundtable; Klaus Schwab at the World Economic Forum and Roberto Bocca, and Pawel Konzal at its Energy Community; Richard Levin, John Gaddis, and Ernesto Zedillo for the opportunity to engage on a regular basis with the faculty and students at Yale University; Patti Domm and her colleagues at CNBC.
Last, but hardly least, is my deep gratitude to my family, my biggest supporters and my toughest critics. Experience has taught them to be patient and forgiving, at least up to a point. Alex and Rebecca brought their own knowledge of history and perspectives on this story to the continuing discussion. My wife, Angela Stent, has been through all my book projects. This is a better book for her eye and for the critical judgment that characterizes her own work. Her love and support have been sustaining all along this considerable journey. To her the thanks is lasting.
Daniel Yergin
CREDITS
Photo insert #1: 1. Gary Kieffer/DOD/Time & Life Pictures/ Getty Images
2. Alexsey Druginyn, STF/RIA Novosti
3. Vincent Laforet/AFP/Getty Images
4. N/A
5. Alexsey Druginyn, STF/RIA Novosti
6. Royal Dutch Shell/Newscast
7. Courtesy of Marty Miller
8. OPEC
9. BP
10. Henny Ray Abrams/AFP/Getty Images
11. Ed Kashi/VII
12. GOES 12 Satellite, NASA, NOAA
13. © Kimberly White/Reuters/Corbis
14. Rob McKee
15. Photo by Eric Draper. Courtesy of the George W. Bush Presidential Library
16. AFP/Getty Images
17. Courtesy of The New York Public Library, www.nypl.org
18. Image used with the permission of CME Group, Inc. © 2011. All rights reserved.
19. Shane Bevel
20. Daniel Acker/Bloomberg via Getty Images
21. General Motors
22. Da Qing Oil Field Iron Man Museum. Photo courtesy of Petroleum Industry Press.
23. White House Photograph. Courtesy of the Gerald R. Ford Library
24. Hu Guolin/Imaginechina
25. Zhao Bing/Imaginechina
26. World Economic Forum
27. Sergey Guneev, STF/RIA Novosti
28. © Underwood & Underwood/Corbis
29. Marion King Hubbert Collection, Box #133, American Heritage Center, University of Wyoming
30. Marion King Hubbert Collection, Box #83, American Heritage Center, University of Wyoming
31. The Richard Nixon Presidential Library & Museum
32. Courtesy of The Huntington Library, San Marino, California
33. Anadarko Petroleum Corporation
34. Eliana Fernandes/Petrobras Image Bank
35. John Mosier/ZUMA Press
36. Michael Jacobsen
37. © Yann Arthus-Bertrand/Corbis
38. Courtesy of Barco. Copyright Saudi Aramco; All Rights Reserved
39. Copyright Saudi Aramco; All Rights Reserved
40. Chris Hondros/Getty Images
41. AP Photo/Bill Foley
42. AP Photo/Iranian President’s Office
43. Reuters/Fadi al-Assaad
44. www.EastepPhotography.com
45. Cliff Roe
46. Scott Goldsmith
47. Edison National Historic Site
48. Charles Hoff/New York Daily News Archive via Getty Images
49. GE Theater/Courtesy Ronald Reagan Library
50. Hank Walker/Time & Life Pictures/Getty Images
51. © Guy Christian/Hemis/Axiom/ axiomphotographic.com
52. DigitalGlobe via Getty Images
Photo insert #2: 53. The Granger Collection, New York City; All rights reserved
54. Louis Agassiz, Études sur les glaciers. Neuchâtel, Jent et Gassmann, 1840.
55. Reproduced by permission of Bridgette Khan
56.–58. Scripps Institution of Oceanography Archives, UC San Diego Libraries
59. © World History/Topham/The Image Works
60. Dwight D. Eisenhower Presidential Library
61. Alan Richards photographer. From The Shelby White and Leon Levy Archives Center, Institute for Advanced Study, Princeton, New Jersey, USA
62. ABC News
63. © Manchester Daily Express/SSPL/The Image Works
64. Scanpix/Sipa Press
65. George Bush Presidential Library and Museum
66. Photo provided by the office of Representative Edward Markey
67. Courtesy of the Ronald Coase Institute, Photographer: David Joel
68. Bjorn Sigurdson/AFP/Getty Images
69. Artwork by William J. Hennessy Jr./ CourtroomArt.com
70. Courtesy: Jimmy Carter Library
71. Bill Pierce/Time & Life Pictures/ Getty Images
72. AP Photo
73. N/A
74. AP Photo
75. © Ron Sachs/CNP/Corbis
76. AP Photo/Marcio Jose
Sanchez
77. Georges F. Doriot in classroom, 1963. Harvard Business School Archives Photograph Collection: Faculty and Staff, Baker Library Historical Collections, Harvard Business School (olvwork377919)
78. Bloomberg/BusinessWeek
79. Mark Coggins
80. Andy Freeberg
81. ETH-Bibliothek Zurich, Image Archive
82. Reprinted with permission of Alcatel-Lucent USA Inc.
83. National Air and Space Museum, Smithsonian Institution
84. White House Photo
85. Sandia National Laboratories
86. Photo courtesy of John Perlin, from From Space to Earth
87. Suntech Power
88. The Western Reserve Historical Society, Cleveland, Ohio
89. Jim Dehlsen, Ecomerit Technologies, LLC
90. Courtesy of Vestas Wind Systems A/S
91. © 2011 Ripley Entertainment Inc. Image courtesy of ASHRAE
92. Carrier Corporation
93. The Straits Times © Singapore Press Holdings Limited. Reprinted with permission.
94. Rob Benson Photography
95. Lifang Wang/Xinhua News Agency
96. Ken Feil/The Washington Post/Getty Images
97. Reprinted with permission of the DC Public Library, Star Collection, © Washington Post
98. Mario R. Durán Ortiz
99. © Richardo Azoury/Olhar Imagem
100. Photo by R. L. Oliver. Copyright © 2006 Los Angeles Times. Reprinted with permission.
101. © Bettmann/Corbis
102. Courtesy of the Archives, California Institute of Technology
103. AP Photo/Steve Yeater
104. From the collections of The Henry Ford
105. Cincinnati Museum Center/Getty Images
106. AP Photo/Mark Humphrey
107. Courtesy of Alden Jewell
108. Mark Sullivan/WireImage/Getty Images
109. White House Photo
110. Tesla Motors
NOTES
Prologue
1 George H. W. Bush and Brent Scowcroft, A World Transformed (New York: Vintage, 1999), p. 312 (“Nothing will happen”); “The Gulf War,” Frontline, PBS, aired January 9, 1996 (Egypt’s president); cable, U.S. Embassy in Baghdad to Secretary of State, July 25, 1990 (“disputes”); Al-Hayat, March 15, 2008.
2 Bush and Scowcroft, A World Transformed, p. 317 (“crisis du jour”); Richard Haass, War of Necessity, War of Choice: A Memoir of Two Iraq Wars (New York: Simon and Schuster, 2009), pp. 61–62; interview with Boyden Gray.
3 Bush and Scowcroft, A World Transformed, pp. 330, 365.
4 Haass, War of Necessity, War of Choice, p. 148 (“classic containment”); Martin Indyk, Innocent Abroad: An Intimate Account of American Peace Diplomacy in the Middle East (New York: Simon and Schuster, 2009), pp. 40–43, 165 (“dual containment”); Charles Duelfer, Hide and Seek: The Search for Truth in Iraq (New York: Public Affairs, 2009), pp. 117–60.
5 Interview with James Placke; Jeffrey Meyer and Mark Califano, Good Intentions Corrupted: The Oilfor-Food Scandal and the Threat to the U.N. (New York: Public Affairs, 2006), ch. 4; Independent Inquiry Committee into the United Nations Oil-for-Food Programme, Report on the Manipulation of the Oil-for-Food Programme, United Nations, October 27, 2005.
6 Haass, War of Necessity, War of Choice, p. 162.
7 Joseph Stanislaw and Daniel Yergin, “Oil: Reopening the Door,” Foreign Affairs 72, no. 4 (1993), pp. 81–93.
Chapter 1: Russia Returns
1 New York Times, December 26, 1991.
2 Interview with Valery Graifer.
3 Vagit Alekperov, introduction to Dabycha, the first Russian edition of The Prize.
4 Yegor Gaidar, Collapse of an Empire: Lessons for Modern Russia, trans. Antonina Bouis (Washington, DC: The Brookings Institution, 2007), p. 102.
5 Interview with Mikhail Gorbachev, Commanding Heights; Thane Gustafson, Crises Amid Plenty: The Politics of Soviet Energy under Brezhnev and Gorbachev (Princeton: Princeton University Press, 1989), pp. 103–36.
6 Gaidar, Collapse of an Empire, pp. 105–9, 239.
7 Interview with Yegor Gaidar; Thane Gustafson, Wheel of Fortune: The Politics of Russian Oil Under Yeltsin and Putin (forthcoming), p. 10 (government computers); Anders Aslund, Russia’s Capitalist Revolution: Why Market Reform Succeeded and Democracy Failed (Washington, DC: Peterson Institute for International Economics, 2007), p. 107 (“wildly”).
8 Interview with Vagit Alekperov (“revelation”); Gustafson, Wheel of Fortune, pp. 5–14, 54 (“destroying the oil sector”); Vagit Alekperov, Oil of Russia: Past, Present, and Future (Minneapolis: East View Press, 2011), p. 324.
9 Alekperov, Oil of Russia, p. 326; Vadim Volkov, Violent Entrepreneurs: The Use of Force in the Making of Russian Capitalism (Ithaca: Cornell University Press, 2002), ch. 6.
10 Interview with Vagit Alekperov (“hardest thing”); Alekperov, introduction to Dabycha (“Soviet legacy”); Gustafson, Wheel of Fortune, p. 38 (walk to work).
11 Chrystia Freeland, Sale of the Century: The Inside Story of the Second Russian Revolution (London: Abacus, 2009), pp. 114–23, ch. 8; David E. Hoffman, The Oligarchs: Wealth and Power in the New Russia (New York: Public Affairs, 2005), chs. 5, 12.
12 Freeland, Sale of the Century, pp. 187, 384; Hoffman, The Oligarchs, ch. 18; Mikhail Fridman, “How I Became an Oligarch,” Speech, Lvov, November 14, 2010.
13 Interviews with Archie Dunham and Lucio Noto.
14 Interview with Archie Dunham.
15 Wall Street Journal, September 27, 2010.
16 John Browne, Beyond Business (London: Weidenfeld and Nicolson, 2010), ch. 8.
17 John Browne, pp. 144–51; German Khan interview in Vedomosti, January 20, 2010.
18 Peter Baker and Susan Glasser, Kremlin Rising: Vladimir Putin’s Russia and the End of the Revolution (Potomac Books, 2007), chs. 15, 17; Vladimir Putin, First Person: An Astonishingly Frank Self-Portrait by Russia’s President (New York: Public Affairs, 2000); Angela Stent, “An Energy Superpower” in Kurt Campbell and Jonathon Price, The Politics of Global Energy (Washington, D.C.: Aspen Institute, 2008), pp. 78, 95.
Chapter 2: The Caspian Derby
1 Peter Hopkirk, The Great Game: The Struggle for Empire in Central Asia (New York: Kodansha International, 1994), p. 1.
2 New York Times, April 26, 2005.
3 Strobe Talbott, “A Farewell to Flashman: American Policy in the Caucasus and Central Asia,” speech, July 21, 1997.
4 New York Times, October 4, 1998 (“our strategy”); Jan Kalicki, “Caspian Energy at the Crossroads,” Foreign Affairs, September–October 2001.
5 Robert Tolf, The Russian Rockefellers: The Saga of the Nobel Family and the Russian Oil Industry (Stanford: Hoover Institution Press, 1976), pp. xiv (“Russian Rockefeller”), 53–55; Steve LeVine, The Oil and the Glory: The Pursuit of Empire and Fortune on the Caspian Sea (New York: Random House, 2007), p. 146; Ronald Suny, “A Journeyman for the Revolution: Stalin and the Labor Movement in Baku,” Soviet Studies, no. 3, 1972; Simon Sebag Montefiore, Young Stalin (New York: Vintage, 2008), p. 187 (“the Oil Kingdom”).
6 Daniel Yergin, The Prize: The Epic Quest for Oil, Money, and Power (New York: Free Press, 2009), p. 220 (“The Bolsheviks will be cleared”); Geoffrey Jones, The State and the Emergence of the British Oil Industry (London: Macmillan, 1981), pp. 209–11 (Bolsheviks); Alexander Stahlberg, Bounden Duty: The Memoirs of a German Officer, 1932–1945, trans. Patrica Crampton (London: Brassey’s, 1990), pp. 226–27 (“Baku oil”).
7 LeVine, The Oil and the Glory, pp. 50–51; Jeffrey Goldberg, “The Crude Face of Global Capitalism,” New York Times, Sunday Magazine, October 4, 1998.
8 LeVine, The Oil and the Glory, p. 209 “all roads”; Terry Adams, “Baku Oil Diplomacy and ‘Early Oil’ 1994–1998: An External Perspective,” in Azerbaijan in Global Politics: Crafting Foreign Policy (Baku: Azerbaijan Diplomatic Academy, 2009), p. 228 (“disruptive”).
9 LeVine, The Oil and the Glory,
p. 179 (“native son”); Heydar Aliyev, interview, Azerbaijan International, Winter 1994, pp. 7–9 (“core leadership”).
10 Adams, “Baku Oil Diplomacy,” p. 2 (“Mission Impossible”).
11 “Early Oil North or West,” Report, n.d.
12 Interview with Jan Kalicki.
13 LeVine, The Oil and the Glory, p. 350.
14 John Browne, speech, CERA “Tale of Three Seas” Conference, June 20, 2001; Frank Verrastro, “Caspian and Central Asia: Lessons Learned from the BTC Experience,” Center for Strategic and International Studies, White Paper, April 2009 (“arrange and negotiate”).
15 David Woodward to author (fax machine).
16 Nick Butler, “Energy: The Changing World Order,” speech, July 5, 2006 (“engineering project”); Washington Post, October 4, 1998 (“real country”).
Chapter 3: Across the Caspian
1 Nursultan Nazarbayev, The Kazakhstan Way, trans. Jan Butler (London: Stacey International, 2008), pp. 88–89; Steve LeVine, The Oil and the Glory: The Pursuit of Empire and Fortune on the Caspian Sea (New York: Random House, 2007), pp. 97–100.
2 Nazarbayev, The Kazakhstan Way, p. 93 (“raw materials”); LeVine, The Oil and the Glory, p. 92 (“frozen in time”).
3 LeVine, The Oil and the Glory, pp. 93–94.
4 Yegor Gaidar, Days of Defeat and Victory, trans. Jane Ann Miller (Seattle: University of Washington Press, 1999), p. 39 (“trump card”); Nazarbayev, The Kazakhstan Way, pp. 1, 112 (“coma,” “fundamental principle”); Nursultan Nazarbayev, Without Right and Left (London: Class Publishing, 1992), p. 148 (“appendage”); LeVine, The Oil and the Glory, p. 117.
5 Nazarbayev, The Kazakhstan Way, pp. 95–96 (“contract,” Yeltsin); interview with Richard Matzke; LeVine, The Oil and the Glory, p. 239 (“prolonged and bitter”); Washington Post, October 6, 1998 (“their oil”).