Russians Say Separatist Enclaves Will Not Revert to Georgia

Georgia: A Blow to U.S. Energy

The plans of the U.S. and Western oil companies for expanded pipelines in the Caspian region may well be a casualty of Russia's attack

At the core of the struggle is a vast network of actual and planned pipelines for shipping Caspian Sea oil to the world market from countries that were once part of the Soviet empire. American policymakers working with a BP-led consortium had already helped build oil and natural gas pipelines across Georgia to the Turkish coast. Next on the drawing board: another pipeline through Georgia to carry natural gas from the eastern shore of the Caspian Sea to Austria—offering an alternate supply to Western Europe, which now depends on Russia for a third of its energy.

But after the mauling Georgia got, "any chance of a new non-Russian pipeline out of Central Asia and into Europe is pretty much dead," says Chris Ruppel, an energy analyst at Execution, a brokerage in Greenwich, Conn. The risk of building a pipeline through countries vulnerable to the wrath of Russia is just too high.

Another indication that Grandmaster Putin has successfully used Ossetia and Abkhazia to counter the West's energy resource play through Georgia.

Let's try to promote good articles into the most recommended list, not long debates with intellectually bankrupt trolls.

Did you see McCain's quote: "In The 21st Century Nations Don't Invade Other Nations" Apparently McCain started his 21st century after the US invasion of Afghanistan and Iraq.

First Yukos, Then Georgia The WSJ sees the Russia v Georgia conflict as part of Putin's "great game" to control global resources.

Now the world is getting an idea of what a "war for oil" really looks like. Few in the West appreciate the degree to which Vladimir Putin and the Soviet, er, Russian, elite subscribe to a prewar view of power relations and national greatness. Their view is not based on self-reproducing institutions and innovation and the power of trade, but on territory and resources -- lebensraum, as one of their intellectual progenitors called it.

Whatever the pretexts and emotional resonances, the Republic of Georgia, transit territory for two important energy pipelines, was also a challenge to Mr. Putin's pursuit of power through control of energy supplies, especially for home heating, to Western Europe.

Global Research sees the US hands behind it, too.

Washington's bloody fingerprints are all over the invasion of South Ossetia. Georgia President Mikhail Saakashvili would never dream of launching a massive military attack unless he got explicit orders from his bosses at 1600 Pennsylvania Ave.  After all, Saakashvili owes his entire political career to American power-brokers and US intelligence agencies. If he disobeyed them, he'd be gone in a fortnight. Besides an operation like this takes months of planning and logistical support; especially if it's perfectly timed to coincide with the beginning of the Olympic games. (another petty neocon touch) That means Pentagon planners must have been working hand in hand with Georgian generals for months in advance. Nothing was left to chance.
 

Oil from the OCS Moratoria Areas–A Gusher? Or Too Little, Too Late?
Written by Kyriacos Zygourakis
Monday, 11 August 2008

How Much Oil May Be in the OCS?

From the EIA 2007 Annual Energy Outlook [i](AEO) and the 2007 report[ii] issued by the National Petroleum Council (NPC) we learn that there may be about 60 billion barrels of undiscovered but "technically recoverable" oil resources in the lower 48 OCS. Only about 19 billion barrels of these oil resources are in moratoria areas (in the Atlantic, Pacific, Eastern Gulf of Mexico and off the shore of Alaska) precluded by law or public policy from leasing and development. The other 41 billion barrels of undiscovered oil resources, or almost 70% of the undiscovered OCS oil resources, are in areas that are open to leasing and development.

We should keep in mind that the term "undiscovered technically recoverable oil resources" means that this oil has not been discovered yet. The expectation is that this oil will be recoverable with available technology, but it is not certain that it will be economically recoverable. We should also keep in mind that offshore oil is expensive.

IOW, over two-thirds of the undiscovered oil is probably in areas already open to drilling. For some reason oil companies haven't drilled for it, but Republicans insist that they desperately need to open up (meaning hand over) the remaining third.

How Certain Are We About Finding Oil in the OCS?

The NPC report notes: "There is significant uncertainty in resource estimates for those areas of the Outer Continental Shelf (OCS) subject to long-standing moratoria or presidential withdrawal. In the north, mid-, and south Atlantic, most of the west coast, and portions of the eastern Gulf of Mexico, the last acquisition of geophysical data and drilling of exploration wells occurred from 25 to 40 years ago. There were a few prospective discoveries at that time and numerous indications for the potential occurrence of oil and gas."

A NY Times article[iii] adds the following: "... The biggest problem is that much of the coastal United States, subject to a drilling ban since the early 1980s, has not been thoroughly explored for oil. Neither the industry nor the government has any definitive idea how much could be recovered. In order to hazard a guess for some areas of the Eastern Seaboard, the government has had to inspect geological maps from Morocco, which was connected to North America more than 100 million years ago..."

Hence Matt Simmons good advice that we drill enough to ascertain what we actually have. Then we can plan for strategic use of whatever we find.

On Democracy Now, Retired Air Force Col. Sam Gardiner says, “If U.S. Attacks Russia, Russia will Use Nuclear Weapons”

Gardiner interview also on YouTube

On little notice to Americans, the Russians learned at the end of the first Gulf War that they couldn’t—they didn’t think they could deal with the United States, given the value and the quality of American precision conventional weapons. The Russians put into their doctrine a statement, and have broadcast it very loudly, that if the United States were to use precision conventional weapons against Russian troops, the Russians would be forced to respond with tactical nuclear weapons. They continue to state this. They practice this in their exercise. They’ve even had exercises that very closely paralleled what went on in Ossetia, where there was an independence movement, they intervene conventionally to put down the independence movement, the United States and NATO responds with conventional air strikes, they then respond with tactical nuclear weapons.

It appears to me as if the Russians were preparing themselves to do that in this case. First of all, I think they believe the United States was going to intervene. At a news conference on Sunday, the deputy national security adviser said we have noted that the Russians have introduced two SS-21 medium-range ballistic missile launchers into South Ossetia. Now, let me say a little footnote about those. They’re both conventional and nuclear. They have a relatively small conventional warhead, however. So, the military significance, if they were to be conventional, was almost trivial compared to what the Russians could deliver with the aircraft that they were using to strike the Georgians.

I think this was a signal. I think this was an implementation on their part of their doctrine. It clearly appears as if they expected the United States to do what they had practiced in their exercises. In fact, this morning, the Russians had an air defense exercise in the southern part of Russia that borders Georgia in which they—it was practicing shooting down incursion aircraft that were incursion into Russia. They were prepared for the United States to intervene, and I think they were prepared—or at least they were wanting to show the United States that their doctrine of the use of tactical nuclear weapons, if the US attacks, was serious, and they needed to take—the United States needs to take Russia very seriously.

Bush to relax protected species rules
Plan takes scientists out of decision making on species status

The Bush administration on Monday said it plans to let federal agencies decide for themselves whether highways, dams, mines and other construction projects might harm endangered animals and plants.

The proposal, which does not require the approval of Congress, would reduce the mandatory, independent reviews that government scientists have been performing for 35 years. Developers welcomed the plan, while environmentalists derided it.

Heckuva job, Bush.

Dmitry Orlov weighs in with The Trouble with Georgia

It may be difficult for some people to grasp why it is that the Abkhaz or the Ossetians do not much fancy suddenly becoming Georgian, so let me offer you a precise analogy. Suppose Los Angeles, California, were to collapse as the USSR once did, and East L.A. quickly moved to declare its independence. Suppose, further, that the 88% of its population that is Hispanic/Latino voted that the other 12% were free to stay on as "guests," provided they only spoke Spanish. The teaching of English were to be forbidden. After some bloody skirmishes, East L.A. split up into ethnic enclaves. Then some foreign government (say, Russian, or Chinese) stepped in and started shipping in weapons and providing training to the Latino faction, in support of their efforts to restore East L.A.'s "territorial integrity." As a non-Hispanic resident of East L.A., would you then (1) run and hide, (2) stay and fight, or (3) pick up a copy of "Spanish for Dummies" and start cramming?

The Abkhaz and the South Ossetians have made their preference very clear by applying for and being issued with a Russian passport. That's right, the majority of the present native population of these two "separatist enclaves" are bona fide citizens of the Russian Federation with all the privileges appertaining thereto. Lacking any other options, they are happy to accept protection from Russia, use Russian as their lingua franca, and fight for their right to be rid of Georgians once and for all. One of the privileges of being a Russian citizen at this stage, when Russia has recovered from its political and economic woes following the Soviet collapse, is that if some foreign entity comes and shells a settlement full of Russian citizens, you can be sure that Russia will open one amazingly huge can of whoop-ass on whoever it feels is responsible. Add to that the atrocities allegedly perpetrated by the Georgian forces, such as finishing off wounded Russian peacekeepers, and you can see why the normally shy and reticent Russian army might get behind the idea of making sure Georgia no longer poses a military threat to anyone. The Georgians have really done it to themselves this time, and we should all feel very sorry for them. They are not evil people, just incredibly misguided by their horrible national politicians. The West, and the US in particular, bear responsibility for enabling this bloodbath by providing them with arms, training, and encouraging them to fight for their "territorial integrity."

In Barack and the Buck, the WSJ reports that Barack Obama favors a stronger dollar, and that he thinks that strengthening the dollar would help to reduce fuel costs. And oh, they like that. They note that Obama's position differs from Bush/Bernanke, who blame all high commodity prices on supply and demand, thus absolving themselves from all blame.

On the other hand, in Oil and the dollar, James Hamilton of Econbrowser charts a large dissociation between oil prices and the dollar. He believes there's only a 20% correlation between oil prices and the dollar's exchange rate.

James Kunstler writes:   

We should drill drill drill -- because once we give the go ahead for this, we will discover the hard way that it will not solve our oil problem. Here is what Matt Simmons wrote to me in an email (He says substantially the same thing in this CNBC "Squawkbox" clip:

It still makes sense to begin this long process of finding out what might be in our own back yard but it will take at least 15 years before any significant oil production would be likely. The longer we delay, the more irrelevant all this becomes. -Simmons

It becomes irrelevant because this will never offset the depletion occurring throughout the world plus the steep fall-off in exports from Saudi Arabia, Mexico, Venezuela, Russia, and the North Sea that have already commenced.

Kunstler reiterates his politically unpalatable prescription:

Is there anything we can do?
     Of course... and I've repeated it a hundred times

    * Rebuild the passenger rail system (and public transit at all scales) with electrification
    * Prepare to reinhabit our small cities and small towns, while decanting the suburbs and our supersized metroplexes
    * Grow much more of our food locally around these places
    * Rebuild local networks of retail and wholesale trade
    * Prepare to resume manufacturing at smaller scales
    * Raise interest rates to reward savings
    * Do not waste alt.energy production on automobile use

Matt Simmons emphasizes that drilling is no guarantee of oil production (dry holes are part of the reality of the oil and gas business):

The USGS numbers are an embarrassment. To pretend anyone could guess at undiscovered resources in such precision is as naive as banks lending mortgage money to folks with no money.

But the senior USGS folks are adamant that their models are precise, just like the EIA modelers are for future supply of flowing oil.

The blind are leading the blind. What a Fool's Paradise they created.