ATYRAU, KAZAKSTAN — This is the opening scene of the next geopolitical sea-change.
The land looks like Nebraska with camels - the Bactrian type with two humps flopped over to one side or the other and strange patchworks of tufted hair, like long-legged dinosaurs ambling across the fine, grassy sand that yawns into the oceanic distance. This is the steppe at the northeastern corner of the Caspian Sea, where Europe meets Asia.
Out of the remote vastness to the east, great scourges have come thundering through this neighborhood toward Europe for millennia - the Huns, the great Genghis Khan and his Mongol and Tatar hordes, and the Uzbek Timur, known as Tamerlane. They haunted the West and changed the world.
The Caspian is now at the heart of a more modern struggle for resources and power. Still largely unexplored geologically, it has proven oil reserves of between 15 billion and 28 billion barrels and reserves estimated at from 40 billion to 178 billion barrels.
The higher estimates would put the Caspian Basin second only to the Persian Gulf as a source of petroleum. It would be enough to supply all the oil consumed by the United States for a quarter century.
An alternative to Mideast oil
In the coming decades, the Caspian holds the promise of offering Americans and the West a major alternative to oil from the politically volatile Middle East. The diversity of sources could keep pump prices down and help prevent the kind of economic stranglehold that the Organization of Petroleum Exporting Countries (OPEC) inflicted in the 1970s, helping to drive up inflation and stifling the American economy.
To the newly independent countries on the Caspian shores, the oil is even more important. It promises not only a huge boost to economies that have come apart at the seams since the Soviet Union collapsed, but also real independence from a Russia that still holds them on an economic leash.
So billions of dollars of investment from American, European, and Japanese oil companies are flowing to the Caspian. But working these shores is more than oil geology and cost-benefit analysis - the normal risk calculations of the petroleum business. It is a geopolitical chess match.
The first trickle of new oil is coming out of the Tengiz fields, here on the nearly empty steppes of Kazakstan, where the heat is desert-grade in summer and sudden blizzards blow out of Siberia in winter. Tengiz is the single-largest oil field in the world to be developed in the last 20 years.
Consider the irony that with massive oil and gas deposits, Kazakstan is already a heavy energy exporter, yet it is itself not energy independent.
The country's oil is in the west, near the Caspian, or offshore in the Caspian, and the only pipelines lead north to refineries in Russia. The country's own refineries are mainly 1,000 miles and more to the east, fed only by pipelines from Russian Siberia.
So Russians control Kazak oil coming and going. Until 1991, Kazakstan was part of the Soviet Union, and this Caspian region of the country was Russian-controlled as early as the 17th century.
The Kazaks have only one refinery where the oil is, here in Atyrau. But it is a World War II-vintage plant in dire need of new equipment. And the oil still has to travel by small tanker across the Caspian to railroad cars in Baku in Azerbaijan - or else through Russia. And Russia has not been shy about using its pipeline leverage to exclude Kazak oil from market access while negotiating for higher Russian participation in oil projects.
Things began to happen fast in Tengiz in 1992, when San Francisco-based Chevron Corp. struck a deal with Kazakstan to form a concern called Tengizchevroil to develop the field. The money and methods that Chevron brought to the steppe put it 50 years ahead of the local oil industry.
Fatkulla Dauletyarov, for example, worked for the Soviet enterprise that first discovered oil in Tengiz in 1979. But as a drilling engineer for Tengizchevroil, he can do the work in a single day on his computer that took him three to four months before. Tengizchevroil will drill a well next year in four or five months, he says, that would have taken his Soviet enterprise four or five years.
At home, Mr. Dauletyarov lives among his extended family in a small, cinder-block house in a suburb of this dusty, rusty, deeply rutted, and crumbling city.
At work, he takes the company helicopter for the one-hour ride out to "TCO Village"' in the Tengiz field, bypassing the five-hour bus ride on a badly pitted road. He works a 12-hour shift for 15 days straight in his own office with a computer, air conditioner, refrigerator, and two working desks. The canteen, the laundry, and English lessons are free, and though he speaks his native Kazak to his peers, he uses his improving English with his American boss.
In the old days, Dauletyarov and his colleagues often had to plan around materials that were unavailable or, if available, could not be transported to where they were needed. They never have to worry about such things now. They just do their engineering work.
But new frustrations exist. For all the high-powered Western ways that Chevron brought to the steppe, Tengizchevroil has been a stymied enterprise. In May, Russia finally agreed to permit a new pipeline from Tengiz, around the top of the Caspian, through Russian territory to the Black Sea. It will take two years to complete.
"There's a lot of frustration when you can't solve your transportation problems," says Maria Karazhigitina, a former local schoolteacher who is now director of government and public affairs for TCO. But there is tremendous excitement that they appear to be getting resolved, she says.
In September 1999, the first tanker is scheduled to load Tengiz crude near Novorossisk, Russia, for the Bosporus and points west.
Foreigners are suspect
Chevron has to fight a strong perception among Kazaks that foreigners come solely to siphon away crude oil, says Mrs. Karazhigitina. It falls to her to bridge many of the gaps between Kazakstan's government and Chevron. The Tengizchevroil work force of about 3,000 is steadily becoming more Kazak - about 80 percent now.
Headquarters will soon start moving from the inaccessible Tengiz area to Atyrau, a city of about 200,000 residents and raging unemployment. Already, the company has built a new heating plant that supplies 30 percent of the city's heat - badly needed in the howling winter months - and a 15-mile gas pipeline to power it with local gas.
For decades, Kazakstan was treated as a sort of internal third world by the Soviet Union. Karazhigitina is most concerned that Chevron listen to locals and pay attention. So far, she says, it has.
As a Kazak, she says, "No one is responsible for what happens to us except us."
* Tomorrow: New threats to the Caspian caviar trade.