Geo-political volatility is Nihat Gokyigit's bread and butter.
As head of Tekfen Holding A.S., Turkey's foremost oil and gas pipeline constructors, the silver-haired Mr. Gokyigit often operates in a risky political environment.
Rumbling through maps and feasibility studies in his woodpanelled office overlooking the Bosphorus, Mr. Gokyigit exudes an air of confidence as he discusses plans for pipelines that would soon ferry Central Asian and Caucasian oil and gas to western Europe. "Whatever happens, one thing is certain," he says. "Turkey will be at the crossroads of the pipelines."
Mr. Gokyigit's confidence may be somewhat premature. Recent months have been heaping obstacles on Turkey's hopes to become an energy hub and a dominant regional power. If Mr. Gokyigit's native Turkey earlier this year seemed to be achieving a strategic advantage in its tug-of-war with Russia and Iran for regional predominance, it now appears to be fighting an uphill battle.
An agreement with neighboring Azerbaijan to build a $1.4 billion oil pipeline to the Turkish Mediterranean oil terminal at Yumurtalik initially looked certain to set the tone for further debate on the safest and most cost-efficient route for pumping Central Asian and Caucasian oil and gas to the West. That agreement is now in question following the pro-Russian coup in Azerbaijan which toppled pro-Turkish President Abulfaz Elchibey and brought former Soviet Communist Party official Haidar Aliyev to power.
The coup coupled with continued war between Azerbaijan and Armenia over Nagorno Karabakh, an Armenian enclave on Azeri territory, has raised the risk for Turkey that Central Asian and Caucasian nations will opt on the long term for routing their oil and gas to either Russian or Georgian ports on the Black Sea.
"Turkey has always insisted that the oil should be brought to the Mediterranean rather than to the Black Sea," Mr. Gokyigit says.
Yet, even if one discounts the recent Azeri coup, the Turkish-Azerbaijani agreement is fraught with geo-political problems. For one, it envisages as one option a 1,060 km (663 miles) long pipeline that would pass through Iranian territory for 67 km (42 miles) and link up with an existing Iraqi oil pipeline through Turkey.
"I don't see how the political environment can be created to make this work, particularly given the recent terrorist activity," says the Dutch ING Bank's Istanbul representative, John McCarthy, referring to this year's bombing of the World Trade Center in New York.
Although militant Islamic Iran is viewed in the West as a subversive power bent on undermining Western interests by hook or by crook, many of its immediate neighbors located in an inherently volatile part of the world increasingly see it as a beacon of stability.
A look at the map of ethnic strife across the soft underbelly of the former Soviet Union explains why.
Georgia is bleeding from ethnic revolts in various parts of its territory, Armenia and Azerbaijan are locked into a five-year old war, the Northern Caucasus simmers with multiple internal ethnic conflicts as well as smaller nations seeking independence from Russia and Tajikistan is experiencing another round of fighting between the government and pro-Islamic groups.
"Everybody is nervous about Iran, but given that the whole region is unstable, Iran is the most stable state of them all," comments Shireen Akiner, a specialist on the area at London's School for Oriental and African Studies.
Pointing to the initial Turkish-Azerbaijani pipeline agreement as well as recent efforts by India to use Iran as its transit point for regional trade, Ms. Akiner argues that in the land of the blind, one-eyed Iran is king. "Iran will only grow in importance," she says.
Back in his office with its plush carpets and atmosphere of hushed elegance, Mr. Gokyigit spends much of his time seeking ways to overcome obstacles to the building of a 5,000 km (1,600 miles) gas pipeline that would link the Central Asian republic of Turkmenistan with western Europe.
"Europe needs an additional source of gas. The source is Turkmenistan. Why not go through Iran?" Mr. Gokyigit says. The World Bank, the European Bank for Reconstruction and Development and various Western private banks, he says, are eager to finance the $10 billion project, but only if transit via Iran can be avoided.
Recently back from Ashkabad, Mr. Gokyigit quotes Turkmen President Saparmurad Niyazov as saying: "The world does not realize that I have a long border with Iran. Does the world really believe that it benefits peace to isolate Iran to this extent?"
Yet, despite the logic of involving Iran, Armenia is Turkey's only realistic key to positioning itself as the transit point for Central Asian and Caucasian oil and gas. Armenia is likely to be a much easier proposition to sell to international financiers.
Europe and the international financial community have already indicated that they would like to see the gas-pipeline go through a pipeline submerged in the Caspian Sea to Azerbaijan and then either through Armenia or Georgia to Turkey or the Black Sea. To achieve that, hostilities between Azerbaijan and Armenia would first have to come to an end. That is also true for the Azerbaijani-Turkish oil pipeline.
Mr. Niyazov, says Mr. Gokyigit, has little hope that will happen any time soon despite joint efforts by Russia, the United States and Turkey to nudge the warring parties toward the negotiating table.
"We think the pipelines may help to bring peace. But everything hinges on international mediation efforts," says Mr. Gokyigit.
Turkey has been reluctant until now to pressure Azerbaijan into a deal with Armenia for fear that this would jeopardize its chances of using Azerbaijan as its jumping board to the rest of the southern belt of the former Soviet Union. This attitude could change as an Azerbaijan ruled by Mr. Aliyev moves more and more into the Russian orbit.
With a recent U.S. decision to actively seek resolution of conflict in various parts of the former Soviet Union in a bid to reestablish some semblance of regional stability, Turkey hopes that the pipeline debate will still be concluded in its favor. Turkish strategists argue that the United States has a strategic issue in ensuring that Central Asia becomes an alternative source of oil, thereby lessening Western dependence on the Persian Gulf.
Designed to carry 40 million tons of oil a year, the Azerbaijani-Turkish oil pipeline is meant to persuade Kazakhstan to ultimately also pump oil from its Tengiz oilfield to the Mediterranean. But the Omani-backed Caspian Pipeline Consortium, headed by the Bermuda based entrepreneur John Deuss, favors using a Russian pipeline across the northern Caucasus to the Black Sea port of Novorossiysk.
For the time being, says Mr. Gokyigit, Kazakh President Nursultan Nazarbayev has bought on to the consortium's plan. "Nazarbayev does not believe that the problems in the southern Caucasus can be solved soon enough. But he will look at the Azerbaijani option at a later stage," he says.
Mr. Gokyigit doesn't seem particularly concerned about this. Russia, he says, may take itself out of the competition. Some Russians are demanding that Kazakh oil with its high sulphur content first be purified before it is pumped to the Black Sea. "Nazarbayev won't accept that," he says.
The big loser in this replay of what Rudyard Kipling called the Great Game, a 19th century war of wits between Britain, Czarist Russia, Turkey and Iran on the giant Central Asian chessboard, may, however, be Georgia.
Its hopes to become a major international energy transit hub appear to have been dashed. "Everybody initially tried to woo Georgia to create the aura of development in the region. But when push came to shove Georgia was the first one to be sacrificed," says an energy analyst.
Drawing a map on the eve of the signing of the Azerbaijani-Turkish agreement showing Georgia as the linchpin in a network of oil pipelines from Central Asia, Iran, Azerbaijan and oil-rich Chechenya in the northern Caucasus, Georgian Deputy Industry Minister Givi Talakvadze was still dreaming of this enabling his country to propel its economic development forward.
Beyond its strategic advantage, Turkey has good reason to oppose the transport of oil through the Black Sea. It fears congestion in the Bosphorus that separates Europe from Asia and is only 760 meters (830 yards) at its narrowest point, and the environmental risks posed by supertankers plying through the Dardanelles.
"They can't use supertankers there," says John Roberts, an Edinburgh-based energy specialist. "Just imagine a supertanker on its side. It's larger than the straits are broad."
