Last November, the company made a commitment to file its own report exploring the Karakaia alternative by March 21. That overdue paper has just been completed, insiders say, and it does not favor a change in route. Placing the pipeline there would mean traversing the Akhalkalaki district, which Shevardnadze and the company say is off limits. In a letter to international lenders this February, the president cited "security risks" that are "imposed by the proximity of a Russian Federation military base . . . "
The memo was penned at BP's urging, a company representative said, because the government was hesitant to put such politically sensitive concerns into writing. It's not the first time BP officials have tried to keep Shevardnadze on message. In November, company officials wrote to him, "[W]e believe it may be necessary to inform experts who visit with you in the coming weeks that routes through this district are and will remain unacceptable."
photo: Cary Conover
New York's Russian Émigrés Prize Borjomi Water, which may be threatened by an oil pipeline.
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Editor's note: Some call it money for nothing. Just for allowing a major oil pipeline to cross its territory, post-Soviet Georgia could haul in $65 million annually. But as Raffi Khatchadourian reports, there is no such thing as a risk-free route in a land of earthquakes and rebel insurgents. Must this impoverished nation gamble its ecology for its economy?
"Part One: Turkish Fishermen Threaten a Blockade"
"Part Two: The Blood of Massacred Turkish Kurds Holds a Fearful Lesson for Those Who Would Flee Iraq"
"Part Three: Pipeline Project Splits Georgian Village Into Winners and Losers"
"Part Four: America Builds an Army for Industry"
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"Can you imagine anyone running a million barrels of oil a day anywhere near Poland Springs, or through the Yellowstone National Park?" That question has been troubling Badri Japaridze, vice president of Georgian Glass & Mineral Water Company, which owns the Borjomi brand.
Japaridze is soft-spoken, folding his hands over his desk as he speaks. His company, like the oil consortium and the Georgian government and countless other third-party groups, has hired a battalion of experts to evaluate the impact of a spill on the reserve's delicate ecological balance and, more specifically, on the mineral water he sells.
Those experts draw wildly divergent conclusions depending on the side they work for, but no one argues "zero risk" is realistic. Inevitably, then, for Georgia and for Japaridze's company, any pipeline running through the Borjomi-Kharagauli's protected zone is, at least on some level, a roll of the dice.
Confronted with the prospect of a major international project, a destitute country like this one may have little choice. It's unlikely such a large-scale oil venture would ever be conducted in or near Yellowstone. But, observers say, it is important to remember this is Georgia, not the United States.
"The pipeline is fairly essential for this country to move on," says a Tbilisi-based Western development expert. "It pushes Georgia up on the geopolitical screen, and it sustains interest in the country's political and economic transition. On the other hand, it does come with some environmental risk. So the country must ask itself: What marginal benefit is there between turning the project away based on that risk, or allowing it to proceed even if every last fail-safe may not be in place?"
Between those two options, there is, of course, middle ground. Finding it can be impossible when resources and time are scarce, and the deadlines of industry unforgiving. In the United States, a federal judge stripped BP of its privacy because the government believed the company could not be trusted to behave properly in the open market. The U.S. judge's counterpart in Georgia will, in all likelihood, be unable to do the same should the need arise, because of the legal agreement the Georgian government has signed with the consortium.
Perhaps that is fitting. Georgian state officials have proven woefully incapable of providing basic services, and of keeping the public interest a priority. Who is to say they won't act in just as chaotic and arbitrary a manner with foreign investors? For this reason, the Host Government Agreement, as it is called, is designed to overrule virtually all forms of domestic law, except the constitution. According to the agreement, if the government does something that "could hinder or delay any project activity" including "any such action or inaction predicated on security, health, environmental or safety considerations that, directly or indirectly, could interrupt, impede or limit the flow of petroleum," it could incur stiff penalties.
Only under circumstances where the project poses an "unreasonable threat" to Georgia's security, cultural heritage, and the environment can the country intervene. What constitutes an "unreasonable threat," however, is uncomfortably ill-defined, according to Manana Kochladze, Caucasus coordinator for the CEE Bankwatch network, an NGO umbrella group that has been monitoring the project. For this reason, among others, Bankwatch has sought to put pressure on international lenders to examine the project's environmental and legal ramifications carefully. "The Borjomi issue is also an issue of law," she says. "That must be remembered."
