New Pipeline Will Bypass Russia

A 1,760km pipeline from Baku, Azerbaijan, to Ceyhan, Turkey, (BTC pipeline) is being launched. Long considered the linchpin of US strategy in the region, the line bypasses Russia and Iran and links the ex-Soviet states to Nato-member Turkey.

A symbolic first pipe section was laid in Baku in September, although actual construction will not begin until the first half of next year. But aside from superpower rivalries, the five Caspian countries have more pressing matters which need to be addressed before the region prospers.

Landlocked and isolated, it requires costly development. Equipment must be imported from abroad and oil must be shipped out over difficult and sometimes dangerous terrain. The two major pipelines only partially help alleviate the region's difficulties in getting its crude to market.

Azerbaijan, Turkmenistan and Kazakhstan - the three impoverished hydrocarbon-rich countries that border the sea along with Russia and Iran - were now spoken of as an important source of oil and gas that could lessen the west's dependence on the Middle East.

Though hydrocarbon development is undoubtedly the region's main source of profits, it is still considered only an engine to encourage further economic growth. Turkmenistan, Azerbaijan, Kazakhstan and, to a lesser degree, Russia must develop their economies outside of the oil and gas sector. For Azerbaijan, the matter is especially pressing, as oil from its main offshore consortium begins to run out around 2015.