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Rethinking the Caspian Sea: A new approach to the decades-long dispute

 

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Can a worldwide pandemic have a sense of humor? COVID-19 has had terrible effects on both our health and professional lives. Yet, the subsequent decrease in industrial activity and the overall shutdown of transports has led to lower rates of pollution. In Beijing, where the sky is usually covered in smog, citizens can enjoy blue skies and cleaner air (see video). In Nairobi, to the surprise of the population, the Kenya mountains were visible from the city center’s rooftops.

Source: A photo taken last month by Nairobi resident Osman Siddiqi shows One Africa Place, a bullet-shaped glass high-rise in Nairobi, framed by the jagged, snowcapped peaks of Mount Kenya, which many residents said they have never seen from the capital city. Osman Siddiqi.

Our planet’s largest land-locked body of water, the Caspian Sea, is no different. The COVID 19 crisis has decreased the number of shipments and reduced overfishing and loitering on the Caspian beaches. With the decrease in fishing activity, seals have been spotted in Iran in zones they have not been seen in for decades. Unfortunately, this recovery is only temporary as activities related to offshore oil extraction and refining will return to their original speed once the crisis is adequately addressed and overcome.

Despite the apparent importance of protecting the Caspian Sea marine environment, this issue has not been a priority for any of the five bordering countries: Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan. The main challenge that has impeded collaboration is of a legal matter. The Caspian – a sea or a lake? To this day, there is still no clear legal status that encompasses all the disputes. Each one of these countries has its objectives and wants the resources that the Caspian offers for themselves. A new type of approach – that of privatization might be useful in resolving this issue.

Before further discussing this legal status issue, this article will analyze the main ecological threats to the marine environment and their impact on Azerbaijan and the other bordering countries. We will then discuss the legal issue that acts as a barrier towards a clear collective action plan to counter these threats. Finally, we will discuss the sea privatization approach as a possible solution to the dispute.

Ecological threats in the Caspian

The world’s largest landlocked body of water has been under threat of evaporation since the early 20th century. From 1929 to 1962, it had lost 1012 km3 of river water inflow (Vendrov et al., 1964), mainly due to human activity involving, among others, the rapid construction of dams and reservoirs on the Volga river system connecting to the Caspian Sea during USSR times, as well as the changing agricultural practices (Gyul’ and Furman, 1967). The sea level then went through an increase in water inflow from 1978 to 1995 thanks to higher precipitations and the subsequent decrease in evaporation. However, its level still did not stabilize. The downward trend in sea level continued well into the 21st century with the increased surface air temperatures and water evaporation. At the current rate of evaporation of 7cm per year, it is approximated that the Northern part of the Caspian would completely disappear before the end of the century.

If this particular issue is left untouched, not only will Azerbaijan and the other four bordering countries suffer, but also other countries in the region such as Southeastern Turkey, Syria, and Iraq, which all depend on water provided by rainfall from winter evaporation of the Caspian water. On the economic losses side, low water levels will impact the socioeconomic development of all bordering countries. Maritime transportation will also be restricted between seaports on its’ shores due to the lower sea level.

In addition to the sea level instability, the Caspian Sea is also subjected to water pollution mainly due to the extraction of oil and gas, discharge and garbage from wastewaters, and discharge from the Volga basin spoils from oil tankers. Petroleum hydrocarbons were present generally in most of the Northern parts of the Sea, with higher concentrations in places where oil spills occurred. Detergents and ammonium were also present but following a downward trend for the last few years with a small rise in concentration during the summer.

Pollution is a major problem in the Caspian Sea, where it is common to find discarded fishing lines. Source: Mission Blue, 2019.

The Southern part of the Caspian was more polluted by petroleum hydrocarbons, detergents, and ammonium, especially close to sea shelf extraction areas. The highest levels of oil and gas water pollution were measured near the western shores of the Sea, in the Baku Bight (Korshenko, Gul, 2005). The river inflow into the Caspian Sea also plays its role in this. As of 2003, an estimated 60,000 metric tons of petroleum byproducts, 24,000 tons of sulfites, and 400,000 tons of chlorine were discharged into the Caspian yearly (Aghai Diba, 2003).

An estimated 58-155 kilotons of plastic waste was discharged into the Caspian by the bordering countries in 2016. Without change, the number will increase by 15% by 2030 (Ghayebzadeh et al., 2020).

This pollution not only impacts water quality, but also contaminate the soil, destroy the maritime biodiversity, and finally impact public health.

Main sources of pollution in the Caspian Sea. Source: Main Pattern of the Caspian Sea Surface Oil Pollution Revealed by Satellite Data, Mityagina, et al., 2019.

It does not help that the lack of environmental regulation and monitoring leads to the mismanagement of oil and gas resource extraction, and eventually to the major accidents such as the BP 2008 oil spill at the Azeri-Chirag-Guneshli (ACG) field. Contrary to the Mexico Gulf spill a few years later, BP managed to save all workers, but also somehow managed to keep the story covered up from the media and the US government for some time. The 2015 fire caused by a storm at the ACG field was yet another more recent result of the lack of satellite monitoring of the area (Mityagina, Lavrova, Kostianoy, 2019).

All of the previously discussed issues raise the question: how come despite all of the research dating back to the mid-20th century, the Caspian countries have still not agreed on a clear distribution of the waters and decided upon an environmentally-conscious action plan towards sustainable development?

A sea or a lake?

While during most of the 20th century, the USSR and Iran were the only competitors in the battle over the Caspian, it is now an issue between five sovereign countries that all want the best part of the pie to themselves. Both USSR and Iran asked to continue governing the Caspian Lake jointly as they did for the past century (Petrov, Amelin, 2015). A position that goes against the United Nations Convention on the Law of the Sea, which lets each bordering country claim the 28km territorial sea area as well as an exclusive economic zone. All five countries would benefit from cooperation by securing foreign investment, which is risk and uncertainty averse, and controlling the environmental impact of their collective activities. However, Iran continued refusing any compromise on the legal status quo for years (Orazgaliyev, Araral, 2019).

Understandable since depending on its legal nature, each country gets a different share of the resources. Despite years of conflict on this question, a convention was signed between all five countries in August 2018. After long negotiations, the Caspian was granted a ‘special legal status’. Each country gets 28km from their shores for the exclusive exploration and extraction of natural resources, as well as 19km for fishery activities.

Unfortunately, this still does not solve the whole issue. No agreement was reached as to the remaining area of the Caspian. No conflict resolution system was created to deal with future and current disputes, such as the ownership of the Araz-Alov-Sharg exploration block between Azerbaijan and Iran, or the Serdar/Kapaz field (Azerbaijan/Turkmenistan (Whitney, 2018). The convention also does not clarify the limits between countries, and thus these are dependent on other treaties signed or to be signed (see red delimitations on map below).

Legal status of water under the Convention. Source: Freshfields Knowledge, 2018. Available online.

In blue: Territorial waters and outer limits. Green: Fishery zones and outer limits. White: Common maritime space. Red line: Existing delimitations of the seabed.

On the environmental side, each state can conduct studies on any undersea activity with the ‘Environmental Impact Assessment’ protocol pushed by Russia. However, this was a clear attempt for Russia to closely monitor the Trans-Caspian pipeline project bringing Turkmen gas to Europe, which puts Russian gas at threat (IISS, 2018). In a recent interview with SOCAR’s deputy vice-president, Vitaly Baylarbayov stated that Turkmen gas is planned to be connected to Europe through the brand new Southern Gas Corridor.

Map of Southern Gas Corridor (2018). Key. New pipelines to south-eastern Europe: black (completed) and black broken lines (projected). Other gas pipelines: red (large diameter) and blue (other). Source: OIES (adapted from the IEA web site).

Map of Southern Gas Corridor (2018). Key. New pipelines to south-eastern Europe: black (completed) and black broken lines (projected). Other gas pipelines: red (large diameter) and blue (other). Source: OIES (adapted from the IEA web site).

Yet, this first convention was the first concrete step towards regional stability and the foundation for cooperation over environmental issues. In June 2020, during an official video conference, the Environment ministers of Azerbaijan, Kazakhstan, Iran, Russia, and Turkmenistan discussed the importance of closer collaboration on the subject. It seems the ministers believe that the convention on the protection of the Caspian Sea signed in Tehran in 2003 was a demonstration of the countries’ commitment to the cause. Unfortunately, a signed paper only represents intent at best, actions, and results.

“We (the littoral states) demonstrated our commitment to protecting and restoring the Caspian environment by signing the Framework Convention in Tehran. Some proposals have been drafted. Nonetheless, they are not binding and have not taken effect due to a lack of consensus,” Mirzagaliyev, Minister of Ecology, Kazakhstan, 12 June 2020

The Tehran Convention did seem to have a positive impact on the implementation of the United Nations Environment Program, which was supposed to be a temporary solution until an agreement on a permanent secretariat was reached in 2014 with a rotating system. Baku was supposed to establish the first permanent secretariat in 2015, but this was delayed as well. Since then, new initiatives have helped restore hopes for the future of the Caspian. For example, the new online platform created in 2018, the Caspian Environment Information Center gave access to environmental data and research from all five bordering countries.

However, until a clear agreement is reached on the Caspian’s full area and seabed division, real results and environmental cooperation are yet to be seen.

A possible solution from other countries that successfully shared one body of water?

One might argue that whatever is happening to the Caspian Sea is a result of the normal process of climate change our planet has been going through for millennia. Following this same logic, the Netherlands should not build dams to protect its land and prevent flood damage; after all, it is a natural occurrence.

All bodies of water by nature are subject to conflict as they act as a freshwater resource and often contain other resources that can be useful for industry, agriculture, and cultural or religious practices (Petersen-Perlman et al., 2017). In the case of transboundary waters shared among more than two countries, like the Caspian Sea, the management of the body of water is even more complicated, being prompt to verbal, economic, and even military conflicts.

Signing treaties and conventions and creating new institutions is the right way to start the cooperation process, but these need to be enforced in the long-term to have any effect. Moreover, a conflict-resolution mechanism is needed for current and future disputes among the bordering states (Giordano & Wolf, 2003).

Joint-development mechanisms might be presented as the best type of agreement to deescalate diplomatic tensions and create an environment prone to dialogue. However, research shows that very few such agreements fulfill their goals. In the case of maritime boundary disputes, these lead to the deterioration of bilateral relations (Xue, 2019).

A rather unusual line of thought worthy of pursuing is the privatization of the Caspian Sea with the creation of a transnational company where the shareholders would be the governments of the five countries. Each shareholder would then receive a percentage of the annual profits relative to the size of their national resources.

This newly created company would appropriately give out exclusive use rights on resource exploration and extraction (to other companies, e.g., BP, SOCAR, or individuals, e.g., fishers). At the same time, the five governments benefit from pressuring the transnational company as its shareholders, instead of going into lengthy negotiations with its neighboring countries.

The privatization of the Caspian Sea would make it easier to enforce environmental protection acts that would be agreed upon in the agreement's bylaws. For example, the transnational company's creating act could have environmental clauses such as a specific percentage of annual profit going into the development of better waste systems on the shores of the Caspian, or a specific set of rules as to how to manage an oil spill by one of the companies (e.g., BP) operating in the Sea. The financing of its protection would be shared by all shareholders (governments).

All in all, a company-shareholders relationship is much easier to manage than one among five different governments as there is an economic incentive for the company to give expected results to its shareholders, be it in terms of profits or environmental compliance.

Conclusion

The COVID19 pandemic is thankfully for most only temporary. For the Caspian though, the current lower industrial activity levels will not sustain and nature will have to deal with the post-pandemic rise in oil demand. The Caspian will continue suffering the environmental hazards that come with the increased exploration and extraction levels.

The case of the Caspian Sea is no doubt complex, yet solutions are there, even ones that do not require military action nor difficult negotiations lasting decades. The main issue with the Tehran convention is that the exclusive rights agreements do not include the whole area and seabed of the Sea, nor the seashore border demarcations between the five neighboring countries. The rest is still not agreed upon, and any attempts at discussing it are impeded by natural resource ownership disputes.

While the full privatization solution might not be the best option, discussing such new ideas could lead to a more environmentally friendly development of the Caspian. This new approach could be useful in balancing power relations by abolishing direct disputes between states. Instead, governments would be on the same side (shareholders) and would be demanding better results or environmental reparations from a corporate figure.

What is sure is that by dismissing the underlying reasons for environmental degradation, Azerbaijan has been participating with the other four bordering countries and the oil and gas companies in the region to the endangerment of a shared body of water. The Sea that Rasul Rza (Pirşağı, 1937) fell in love with might someday cease to exist.

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Sources:

Aghai D. B. (2003). Pollution in the Caspian Sea, Payvand Iran News, Available at: http://www.payvand.com/ news/02/jul/1073.html

Hannesson, R. (2006). The Privatization of the Oceans. MIT Press. Available at: https://www.researchgate.net/profile/Dale_Squires/publication/288847099_Marine_conservation_and_fisheries_management_At_the_crossroads/links/568ad0d908ae1e63f1fbfb5e.pdf#page=681

Hollis, G. E. (1978). The Falling Levels of the Caspian and Aral Seas. The Geographical Journal, Vol. 144, No. 1, pp. 62-80.

Ghayebzadeh, M., Aslani, H., Taghipour, H., Mousavic, S. (2020). Estimation of plastic waste inputs from land into the Caspian Sea: A significant unseen marine pollution. Marine Pollution Bulletin, Volume 151, February 2020.

Giordano, M. A., Wolf, A. T. (2003). Sharing waters: Post-Rio international water management. Natural Resources Forum, 27(2), 163–171.

Gyul', K. K., Furman, T. I. (1967). Development of research on the Caspian Sea. Soviet Hydrology, 1967: 20.

IISS. Stevenson, J. (2018). The Caspian Sea Treaty, Strategic Comments, 24:9, i-ii, DOI: 10.1080/13567888.2018.1557841

Petersen-Perlman, J. D, Veilleux, J. C., Wolf, A. T. (2017). International water conflict and cooperation: challenges and opportunities, Water International, 42:2, 105-120.

Korshenko, A., Gul, A. I. (2005). Pollution of the Caspian Sea. Hdb Env Chem Vol. 5, Part XX (2005). State Oceanographic Institute, Moscow, Russia. Institute of Space Research of Natural Resources of Azerbaijan, Baku, Azerbaijan.

Mityagina, M. I., Lavrova, O. Yu., Kostianoy, A. G. (2019). Main Pattern of the Caspian Sea Surface Oil Pollution Revealed by Satellite Data. Ecologica Montenegrina 25: 91-105.

Vendrov, S. L. et al. (1964). Water-management problems of western Siberia. Soviet Geog. 5,5: 13-24.

Whitney, C. (2018). The Convention on the Legal Status of the Caspian Sea - A sea or not a sea: that is still the question. Norton Rose Fulbright. Available at: https://www.nortonrosefulbright.com/en/knowledge/publications/5f222b95/the-convention-on-the-legal-status-of-the-caspian-sea---a-sea-or-not-a-sea-that-is-still-the-question

Xue, S. (2019). Why Joint Development Agreements Fail. Contemporary Southeast Asia, Vol. 41, No. 3, pp. 418-446.

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