The Caspian Sea is shared by the Transcaucasian and Central Asian countries Azerbaijan, Kazakhstan, Russia, Iran and Turkmenistan. The biggest oil and gas fields are Tengiz, Karachaganak and Kashagan in Kazakhstan, Azeri-Chirag-Gunashli and Shah Deniz in Azerbaijan, Khazar and Osman in Turkmenistan, South Pars of Iran and Qatar and Azadegan in the Islamic Republic of Iran.
The energy industry has a big share in the GDP of these countries: 75 percent for Iran, 73 percent for Turkmenistan, 65 percent for Azerbaijan, 35 percent for Russia and 25 percent for Kazakhstan.
The U.S. Energy Information Administration (EIA) estimates that the Caspian Basin contains around 48 billion barrels of oil and 292 trillion cubic feet of proven and probable gas reserves. However, the hydrocarbon resources are unequally distributed. According to the BP Statistical Review of World Energy, the leading holders of the resources are Kazakhstan, Turkmenistan and Azerbaijan.
Kazakhstan’s share of oil is approximately 75 percent and of gas 45 percent, Turkmenistan possesses six percent of oil and 44 percent of gas, while Azerbaijan has 18 percent of oil and 10 percent of gas respectively.
Taking into account the economic potential of the Caspian countries, they should unite their forces and cooperate in order to give an impetus to the further prosperity of the region. First of all, their effort should be put into the formation of a common energy strategy.
Despite the strong economic role that energy is playing in these countries, they still have not elaborated a common strategy. It would be significantly easier for them to conduct their policies on the common market where the middle eastern countries also want to impose their rules of the game.
Apart from that, the existence of a common strategy as well as the desire to collaborate would help them maximise the production volume of oil and gas, establish production chains and boost the energy trade not only abroad but also within the confines of the region. Together, they could improve and further develop the infrastructure (pipelines, maritime, railway) used to transport the gas and oil to the external countries.
Nowadays, the major oil and gas pipelines in the region are the BTC and BTE Pipelines from Azerbaijan to Turkey, the CAC Pipeline System from Turkmenistan to Europe and the Kazakhstan- China Pipeline. Of course, strengthening the cooperation in the economic field can bring enormous revenue to the Caspian countries. Nevertheless, one should not forget about the cooperation in the ecological field.
Due to the daily extraction of hydrocarbon materials, the biodiversity of the Caspian Sea is facing major negative effects, which can only be solved if the Caspian energy quintet consolidates its powers and takes steps for implementing renewable energy into their energy sectors, not immediately but within the next 30 years.
All that seemed to be impossible before; the idea of cooperation was very blurry. The reason for this was the uncertain legal status of the Caspian Sea after the collapse of the USSR, which had to share it not only with Iran, as before, but also with new independent countries such as Azerbaijan, Kazakhstan and Turkmenistan.
Nonetheless, the legal status of the sea is not an issue anymore after August 2018, when the Convention on the legal status of the Caspian Sea was signed at the Fifth Caspian Summit in Aktau, Kazakhstan. The Convention has finally delimited the sectors of the sea of the Caspian states and has eradicated all obstacles, thereby paving the way to further cooperation.
The Caspian Sea-the Black Gold Mine- with its enormous energy resources is not only a great resource of the world’s hydrocarbon raw materials but also a driver of regional integration and cooperation, which can lead to mutual benefits at different economic and even ecological levels. Thus, the fire of the Caspian Sea can now light the way to common prosperity.