Presidents of Littoral States Sign Deal in Aktau:

Caspian Convention Without Marking Out Borders

Date: 12 August 2018 - 21:50

News ID: ۵۶۲۴۱

AKTAU, Kazakhstan (Dispatches) -- Iran and four ex-Soviet nations, including Russia, agreed in principle on Sunday how to divide up the potentially huge oil and gas resources of the Caspian Sea, paving way for more energy exploration and pipeline projects.
However, the delimitation of the seabed - which has caused most disputes - will require additional agreements between littoral nations, Iranian President Hassan Rouhani said.
For almost three decades, the five littoral states - Russia, Iran, Kazakhstan, Turkmenistan and Azerbaijan - have argued over how to divide the world’s biggest enclosed body of water.
And while some countries have pressed ahead with large offshore projects such as the Kashagan oil field off Kazakhstan’s coast, disagreement over the sea’s legal status has prevented some other ideas from being implemented.
One of those is a pipeline across the Caspian which could ship natural gas from Turkmenistan to Azerbaijan and then further to Europe, allowing it to compete with Russia in the Western markets.
Some littoral states have also disputed the ownership of several oil and gas fields, which delayed their development.
"We have established 15-mile-wide territorial waters whose borders become state borders,” Kazakhstan President Nursultan Nazarbayev told a briefing after signing the Caspian convention.
"Adjacent to the territorial waters are 10 miles of fishing water where each state has exclusive fishing rights,” he said.
Nazarbayev also said the convention explicitly barred any armed presence on the Caspian Sea other than that of the littoral states.
The dispute began with the fall of the Soviet Union which had had a clearly defined Caspian border with Iran. In negotiations with post-Soviet nations, Tehran has insisted on either splitting the sea into five equal parts or jointly developing all of its resources.
None of its neighbors have agreed to those proposals and three of them - Russia, Kazakhstan and Azerbaijan - effectively split the northern Caspian between each other using median lines.
Azerbaijan, however, has yet to agree on how to divide several oil and gas fields with Iran and Turkmenistan, including the Kapaz/Serdar field with reserves of some 620 million barrels of oil.
The three countries have tried to develop the disputed fields while at times using warships to scare off contractors hired by other sides. As a result, none of the disputed projects has made much progress.
Speaking after the signing on Sunday, all five leaders praised it as historic event, but provided little detail about provisions on splitting the seabed.
However, making it clear that the document is no final solution, Rouhani said border delimitation would require further work and separate agreements, although the convention would serve as a basis for that.
Moscow has no outstanding territorial disputes but has objected, citing environmental concerns, to the construction of a natural gas pipeline between Turkmenistan and Azerbaijan which would allow Turkmen gas to bypass Russia on its way to Europe.
Officials of the five Caspian Sea littoral states also signed six documents for strategic and economic cooperation on transportation, fighting terrorism and organized crime as well as border security.
Iranian Foreign Minister Muhammad Javad Zarif commended solidarity among the Caspian states, saying that they will further continue cooperation on "unresolved issues."
"Day of solidarity of Caspian Littoral States: Codifying cooperation on environment, shipping, fisheries, sustainable development & security w/o foreign military presence," Zarif tweeted.
Before heading to Aktau, President Rouhani stressed that all legal issues of the sea should be implemented through the consensus of the five littoral states.
"The convention stipulates that all legal issues of the Caspian Sea are operational and applicable only through the consensus of the five countries, which is very important and fundamental," he said.
The legal status of the largest inland body of water in the world with its abundance of hydrocarbon reserves has been the subject of fraught negotiations for over two decades since the Soviet Union's collapse.
There are an estimated 48 billion barrels of oil and 292 trillion cubic feet (8.3 trillion cubic meters) of natural gas in proven and probable reserves in the Caspian basins and its surrounding area.
The Caspian Sea is also the natural breeding ground for the best sturgeon species including the giant beluga fish from which one of the world's priciest delicacies, caviar, is extracted.
Sturgeon stocks, however, have severely been depleted as a result of overfishing, with environmentalists hoping that the new agreement will boost preservation efforts.
Rouhani said the convention specifies exclusive fishing and shipping areas, but leaves issues related to the baseline and the seabed to future agreements among the Caspian states.
A baseline is the line along the coast from which the seaward limits of a state's territorial sea and certain other maritime zones of jurisdiction are measured, such as a state's exclusive economic zone.
"Some issues have been resolved and some issues remain (unresolved) and these two issues, one being the baseline and the other the extent of the basin and under the basin, remain to be resolved in future agreements," Rouhani said.
"Taken together, this is an important convention which moves us one step forward, although there are still very important issues for the future" to be resolved, he added.
Caspian states have made connectivity the cornerstone of their regional cooperation, drawing up development strategies in line with China’s massive project to build a modern-day "Silk Road.”
Rouhani touched on two transportation corridors via Iran which connects countries on both the western and eastern sides of the Caspian Sea to the Persian Gulf and the Sea of Oman.
The North-South Transport Corridor (NSTC) through Turkmenistan links the subcontinent to the Middle East, the Caucasus, Central Asia and Europe, which has drawn great interest from Russia and India.
Iran and Azerbaijan are also building the Rasht-Astara railway which provides an alternative route to the corridor.