Washington put on quite a show last week for an improbable personage: Turkmenbashi, a plump, silver-haired strongman from an obscure country in central Asia who would normally rank far down the pomp-and-protocol chart.
But the title, which means "head of all Turkmen," belongs to one Saparmurat Niyazov, President of Turkmenistan, a parched former Soviet republic that happens to sit atop immense oil deposits and the fourth largest natural-gas reserves in the world. So last week Niyazov got the imperial treatment from the Clinton Administration and a host of U.S. businessmen eager to start exploiting those riches in earnest.
Niyazov was put up at Blair House, across the street from the White House, an honor reserved for true VIPs. He got 45 minutes with Clinton in the Oval Office and conferred with Cabinet officers and CIA Director George Tenet. More than two dozen oil and equipment companies kicked in to sponsor a dinner in Niyazov's honor at a downtown hotel, and 300 of America's top government decision makers, business executives and lobbyists thronged the ballroom.
Niyazov is one of the new kingpins of the Caspian Sea and the treasure it covers. The California-size Caspian, center of the last great oil rush of this century, laps across a huge mine of liquid gold. Some 200 billion bbl., or about 10% of the earth's potential oil reserves, are thought to lie under and around the sea. At today's prices that could add up to $4 trillion worth. The Caspian lies in a tough part of the world, studded with rugged mountains, Chechen guerrillas, dissident Kurds, crowded sea-lanes and unstable and corrupt governments in all directions. Laying hundreds of miles of pipe through such obstacles will carry a huge price tag and enormous risks.
The world's energy companies began scrambling for the prize as soon as the Soviet Union broke up, in 1991, and the biggest oil firms from the U.S., Europe, Russia, Japan, China and South America have bought into the action, forming consortiums and joint ventures with local companies to generate the huge start-up costs. Some of the wells are already pumping, and in a few years oil will be flooding out of the Caspian reserves. But how will the precious stuff travel to energy-hungry consumers? Who will have a hand on the spigots as it flows to market?
The key to that decision probably lies in Baku, capital of Azerbaijan and headquarters of the biggest multinational oil consortium in the region. It's an old city but a new boomtown. The shoreline along the tree-shaded boardwalk is gray with oil, and the air is heavy with the dizzying stench of crude. The city sprouts new bars, cafes and nightclubs every week, and petro-barons fill the nights with the roar of their armored Mercedes-Benz.
So far this year, a 12-company consortium, led by British Petroleum and Amoco, has produced 160,000 tons of oil. This early production has traveled out through a 2-ft.-wide pipeline, heading north through Azerbaijan and west to the Russian port of Novorossisk on the Black Sea.