Part Three: Disgust, Distrust, and Death Threats

Pipeline Project Splits Georgian Village Into Winners and Losers

AKHALI SAMGORI, GEORGIA—Four years ago, Jemali Tsiklauri, a trader and traveler who had gone off to find fortune in Moldova, returned penniless to this desolate village to try his hand at living off the land. He knew the soil on his fields was barren, the drinking water so contaminated he had to buy it from trucks. But the 53-year-old purchasing specialist (in Soviet times, his title was simply "expert in goods") had not much choice. Subsistence farming, he believed, was the only way he could go on surviving.

Tsiklauri found his village much as it had been, maybe worse. Akhali Samgori is the product of Communist–era central planners who needed housing for workers at a nearby metallurgical plant. Since the Iron Curtain fell, the plant’s operations have rusted to a virtual standstill, and surrounding communities have had to scrape by. Bony cows tug at weeds near walls enclosing acres of dilapidated industrial machinery. Natural gas and electricity are absent luxuries. Unemployment is as high as 95 percent.

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The BTC pipeline will pass through land Jemali Tsiklauri says belongs to him. But with no way to prove his ownership, he'll get no compensation.
(photo: Raffi Khatchadourian)
Still, Tsiklauri quickly recognized he might have come home at the right time. Next month, construction will begin on a $3 billion oil pipeline that will arc through Akhali Samgori. The project, known as the Baku-Tbilisi-Ceyhan, or BTC, pipeline, is headed by BP (formerly British Petroleum) and heavily promoted by the United States. In the coming decades, up to a million barrels a day of Caspian Sea crude will pass through this village on the way to Turkey's Mediterranean port of Ceyhan. The pipeline is the kind of project that could help wean Western markets off unstable Middle Eastern suppliers like Iraq. For its role as a transit corridor, Georgia will earn roughly $65 million a year.
No road to riches: Big oil came to a remote Georgian village and left this rutted way.
photo: Raffi Khatchadourian
No road to riches: Big oil came to a remote Georgian village and left this rutted way.

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Editor's Note:
As it unspools from Azerbaijan to Turkey, the Baku-Tbilisi-Ceyhan oil pipeline will cross endless acres of private and state-owned land. The project's backers say they'd like to compensate everyone involved—but as Raffi Khatchadourian reports, in post-Soviet Georgia, that's no easy intention to fulfill.


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"Everyone is talking about it," says Tsiklauri, standing in his small garden. People here want to sell their property to the BP-led consortium, known as the BTC Company, and get a piece of the action, a ticket out of the village, or at least some relief from poverty. Tsiklauri ducks into his two-room cinderblock house, where a tattered bed, a table, and a few chairs surround a woodstove, the only source of warmth. In semi-darkness, he kneels and tosses a few pieces of weathered, machine-cut wood into the ambers. "These are from my fence," he says. Coffee boils in a tin bowl over the stove. He pours it, and then sits to talk about a disappointing discovery: He will not be one of the lucky ones—although luck, he is certain, had nothing to do with it.

This sad realization came to him about four months ago, not long after BTC officials visited the village to scout the land they wanted to buy. They photographed various parcels, made detailed assessments of what was there, and, when satisfied they’d found the correct landowner, asked the person to sign a paper they called an inventory agreement. Then they left, promising to return with offers to purchase land wherever construction would proceed. Tsiklauri is sure he should be among those who receive compensation, because the pipeline will be buried three feet deep on his property. The only problem, he says, is that records of his deed vanished from the state land registry into a vortex of low-level corruption.

Land fraud and manipulation of the registry have been long-running problems throughout much of the former Soviet Union, where state monopoly on ownership gave way to shadowy markets with few clear rules. "The system in Georgia is so fuzzy one can’t easily judge what happens locally," says one Western diplomat. "In the BTC pipeline safety corridor, a fair number of what are called ‘mushroom parcels’ suddenly emerged from nowhere. They are exactly the dimensions of the corridor—it isn’t subtle." That leaves a company like BP, which has branded itself as an environmentally and socially responsible purveyor, the difficult job of trying to keep its feet clean as it treads such muddy terrain.


Modern Georgia, a mountainous republic of roughly 5 million people and numerous ethnic groups, was born into chaos. Following Soviet collapse, multiple civil wars tore the country apart. The fighting ended in the mid 1990s, but Georgia is not whole. Two breakaway provinces—Abkhazia and South Ossetia—operate in a state of virtual independence. In Tbilisi, the capital, fistfights are known to break out on the floor of the highest legislative body, and parliamentary deputies accuse each other of forming private armies. A tradition of fierce localism, combined with pandemic corruption, has meant the state is often helpless in enforcing laws throughout the country. Transparency International, a Berlin-based nongovernmental organization, puts Georgia among the 10 most corrupt countries in the world. Moreover, a recent U.S. State Department report observes: "Many U.S. and foreign firms doing business in Georgia have had direct experience with official corruption."

Local NGOs say some of that illegality might be creeping into the BTC pipeline’s land acquisition process, with regional bosses possibly doling out state-owned parcels to kin and cronies. Green Alternative, a Tbilisi-based environmental watchdog, says it has collected several reports of criminal activity, ranging from complaints of fudged registries to gunmen tracking down those who've been paid and demanding a 10 percent cut. "One man came to us," says Kate Kvinikadze, an activist at Green Alternative. "He was told the registry showed his land—land the company wanted to buy—belonged to someone else, although the authorities would not say who. When he started to make noise about it, he was told there was a mistake and that he owned another parcel, also along the route." Now the man is afraid to talk, lest he jeopardize his compensation.

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