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Charles Kennedy

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Charles is a writer for Oilprice.com

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Is There Oil in 'Kryzakhstan'? Ask John Kerry

Is There Oil in 'Kryzakhstan'? Ask John Kerry

It wasn’t exactly a propitious start for new US Secretary of State John Kerry on his first foreign trip when he referred to “Kyrzakhstan”, where US diplomats are ostensibly working to secure “democratic institutions”.

Getting all those Central Asian “stans” right can be confusing—even more so when things get muddled in the “Great Game”. And it’s no easy thing following in the footsteps of Hillary Clinton.

Later—after the State Department took the liberty of omitting the mention of “Kyrzakhstan” from the official transcript—it became clear that Kerry was actually referring to Kyrgyzstan (not Kazakhstan and indeed not Kyrzakhstan).

So let’s look at these two countries that Kerry has inadvertently combined.

Kyrgyzstan is a landlocked country of 5.5 million people which has undergone revolution and reverse revolution since 2005 and “democratic institutions” are embryonic at best. It’s extremely poor and the recipient of massive amounts of US aid, thanks to its willingness to cooperate in the global war on terror. Kyrgyzstan is important to Washington because it’s also a staging ground for a US-Russian struggle to see who can gain the most influence over Bishkek.

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Kazakhstan, on the other hand, is an oil-rich nuclear power that was oddly enough the choice of venue for P5+1 talks with Iran over the latter’s (not to be confused with the former’s) nuclear program. 

Perhaps this added to Kerry’s confusion—indeed it is some heavy symbolism that had some asking why dictatorial Kazakhstan is allowed to have a nuclear program, while Iran is not. In the 1990s, this former Soviet Republic won praise for relinquishing a massive nuclear stockpile (more than a thousand strategic nuclear warheads and 370 nuclear-tipped cruise missiles) in the name of nonproliferation. Washington was hoping Tehran would recall this and take note of the message—though the message remains somewhat unclear as Iran does not have nuclear weapons. The message was further muddled by earlier suspicions that Kazakhstan may have actually been “proliferating” to Iran.

Now Kazakhstan is hoping to make some cash by becoming a “host” for nuclear reactor fuel so that countries (like Iran) wouldn’t have to enrich uranium themselves. Of course, one might also ask whether we want Kazakhstan to serve as a nuclear reactor fuel bank.

On the nuclear front, no one is quite convinced that Kazakhstan should be a nuclear power. It’s not exactly a beacon of democracy, either. Its leader Nursultan Nazarbayev can only very loosely be said to have been democratically elected, and he is continually propped up by Western governments and oil interests.

He is referred to fondly as the “Sultan of the Steppes” and is almost as colorful as the late Turkmenbashi (the revered “father” of Turkmenistan whose cult of personality was unrivaled even by the likes of North Korea’s late Kim Jong-il). While the Turkmenbashi even went as far as to change the names of the months to concepts that reflected his love for his mother, the Sultan of the Steppes creates holidays in honor of himself and sets himself up as the lead character in fairy tale plays and movies for the nation to enjoy. 

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He is not only tolerated but courted heavily because of the country’s oil wealth. US investors have a major stake in its Kashagan field, which has around 5.4 trillion tons of oil and 1.7 trillion tons recoverable—not to mention a handful of other major fields with oil, condensate and natural gas reserves.

In late October, the US and Kazakhstan signed a Joint Action Plan to promote cooperation in nuclear security and nuclear power, hydrocarbon resources, renewable energy, energy efficiency and electric power. Underpinning this US-Kazakh relationship are pipeline plans. The US is hoping that Kazakhstan will channel all its oil and gas exports through Turkey (as opposed to Iran). But Kazakhstan has many interests—and they include burgeoning relations with China (which is particularly gunning for the country’s uranium deposits) and efforts to ensure Russia that all is well between Moscow and Astana, too.


And then we have Kyrgyzstan, which pales by comparison and would probably benefit from being lumped together in a contrived country of “Kyrzakhstan”. It has a bit of oil and gas, and a bit of gold, but overall relies on imports to most of its energy needs. On the border with China, and part of Russia’s old Soviet backyard—as well as a transit point for stuff going in and out of Afghanistan for NATO—it has some strategic importance. But a lack of Western effort here to prop up any single leadership figure has meant that the country is languishing without an effective government since the short-lived “Tulip Revolution” in 2005, which ousted president Askar Akayev. No one rushed to help him because he doesn’t have oil wealth to back him up. Widespread poverty and north-south ethnic divisions keep the violence simmering. 

Kerry is in the middle of a European/Middle East tour right now. We’ll see what other countries he manages to contrive.

By. Charles Kennedy of Oilprice.com

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  • Gordon Steingart on March 01 2013 said:
    John Kerry is the most qualified person in the last 50 years to be placed in the job of Secretary of State. Whether his performance is scrutinized by the media fairly is the real question. I think reporting should stop comparisons since the job constantly changes,outcomes are diversified and what might seem incorrect now could prove in the long term to be right. The media should start realizing that there are not a lot of people in the country that are qualified to be Secretary of State. Clinton was a good choice because of her background as first lady but her success was more tuned to hard work and inside council than anything else. Kerry has been wrongly pegged as a flipper,a personal political attack that had no substance then and none now. He is steadfast in his belief of peace and as little U.S. involvement of the affairs in the Middle East without compromising U.S. security. The man knows the job as seen through the political wing of the United States ( Senate Foreign Relations Chairman),now he should be given a chance to fully use the Bureaucratic arm of the United States in his job,without being henpecked by the media,which serves no purpose.
  • Joseph Conrad on March 01 2013 said:
    Kerry will be a breath of fresh air in hi new post, or so it would appear. As for the US accessing Oil and Gas in Central Asia, I am quite pessimistic. China an ussia will logically not accept a US presence - corporate or military (is there a difference now?). Frankly, my hope is he will calm the waters in Non-white resources Rich nations or face th possibility of more CIA-instigted civil unrest in said nations. The world and US economies are in a shambles because the .001% are determined to rule, pillage and plunder Non-whitre resources-rich nations. More white troops in Africa will leave the US military in flames and the nations in chaos. Not a great environment in which to steal resources - look at Nigeria. When will White Amercia & NATO see they must negotiate to get the best price. Look at Syria, Somalia and Lybia. All 3 are dead meat for at least a decade because of the approach the US & Nato have taken in dealing with former Colonial Africa!
  • none on March 02 2013 said:
    Ah, it is Jen Alic with his usual pisspoor research.

    Great article this time though Jen, mocking Kerry's pronounciation when you're claiming:

    "[...] Kashagan field, which has around 5.4 trillion tons of oil and 1.7 trillion tons recoverable"

    So Kashagan has c. 12.75 trillion barrels of oil recoverable. Wow, that's a lot there Jen, infact it is 47 times Saudi Arabia's reserves! Or to put it another way, over 1,200 years of current consumption!

    I also love your claim that:

    "US investors have a major stake in its Kashagan field."

    It's just a shame that in November 2012, ConocoPhilips sold its 8.4% stake to ONGC, isn't it Jen? In fact, US companies don't have any stake in Kashagan!

    If you're going to publish work then at least do some research lazybones.
  • John on March 06 2013 said:
    ExxonMobil has about 16% stake in Kashagan.

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