Energy analysts
from WoodMacKenzie present an interesting possible future scenario for the
Caspian Region, which includes resources from several countries being delivered
to two points in the Mediterranean. The system is already mostly in place and
running through pipelines built in the 2000s and 2010s.
Back in May, I wrote a post about the Middle Corridor, also known as the
Trans-Caspian International Transport Route (TITR). It is an overland trade
route connecting China and Europe that can and likely will replace the dominant
Northern Corridor, which runs through Russia, for two big reasons. 1) it is
shorter and much faster, by about five days, and 2) it avoids Russia. A third
trade route is the ocean route that runs through the Persian Gulf and remains
constrained. The Middle Corridor avoids both Russia and Iran, two countries that
flout international rules and exhibit military buildups and aggression. With
sanctions as an economic tool against their unfairness, they are both
unreliable in trade and do not deserve to be placated. Russia has been accused
of stalling the Middle Corridor through its influence over the government of
Georgia, through which it passes. The two overland routes and the ocean trade
route are shown below.
Three Caspian countries in
particular, Azerbaijan, Kazakhstan and Turkmenistan, are geopolitically stable
countries with significant oil & gas resources. WoodMac says they could
collaborate and empower the region to play a bigger role as a reliable supplier
of energy and natural resources, including critical minerals.
Azerbaijan is strategically
located to access and supply global markets. The country also hosts both oil
& gas in significant quantities offshore in the Caspian Sea. These are
dominated by BP’s giant offshore ACG and Shah Deniz projects. As noted below,
these and other projects ensure a stable supply of oil and growing volumes of
gas, with large amounts for export.
“These fields propelled total production to 1.2 million
boe/d by 2010, with 80% of that oil. Output has held this level ever since, and
on our forecasts will stay there through to the late 2030s helped by Phase 2 of
TotalEnergies’ Absheron gas project which FID’d last month. Gas has become the
growth story, comprising about 60% of production in 2026.”
They also note that the country’s
national oil company (NOC) SOCAR invests significantly in upstream projects and
is seeking to expand production. It is attracting investment for offshore
expansion as well as for a large unproven onshore shale play that ExxonMobil
has a license to explore.
The BTC pipeline was turned on in
2005. It transports crude oil from Azerbaijan through Türkiye to a port on the
Mediterranean. It also transports oil from Kazakhstan and Turkmenistan, but
there is still available capacity on the 1.2 MM b/d pipeline. The TANAP (2018)
and TAP (2020) gas pipelines carry Azerbaijani gas through Georgia and Turkey
and on to the European gas network via Greece and Italy. Azerbaijan’s
refinery capacity is for domestic use only, so it does not export refined
products.
They also note that energy
connectivity and alternative routes were discussed at a recent conference in
Almaty, Kazakhstan.
“Energy connectivity and diversification of export
routes were big themes last week at the KIOGE conference in Almaty, Kazakhstan.
A possible East-West ‘Green Corridor’ linking renewable power supply to
Azerbaijan via an interconnector across the Caspian Sea was much discussed.”
That sounds like mainly a power
transmission route, but I am unsure. Kazakhstan’s NOC is KazMunaiGas, and it
invests in upstream and midstream projects. Other long-established companies in
the region include Chevron, ExxonMobil, Eni, Shell, TotalEnergies, CNPC, Lukoil
and Inpex. The country currently produces 2.2 million b/d of liquids, with over
1.5 million b/d exported through the CPC pipeline to Russia’s southern coast.
That pipe has faced some disruption due to the Russia-Ukraine war, but Ukraine
has ceased targeting it at Kazakhstan’s request. That system could be upgraded
to produce a few hundred thousand more barrels per day. Kazakhstan produces
mainly oil and liquids.
Turkmenistan has one of the
world’s larger supplies of natural gas. The giant Galkynysh Field is the
second-largest natural gas field in the world. Gas exports contribute nearly a
third of the country’s GDP. Its gas is currently exported to China, but there
is room in the vast field for further development and export to other regions,
including Europe. Turkmenistan’s main producers are its NOC, Turkmengaz, as
well as CNPC, Petronas and XRG.
The analysts lay out the
ideal solution below:
“A logical solution for the region is obvious – build
new pipelines across the Caspian Sea to link Kazakhstan’s oil and
Turkmenistan’s gas to the existing export routes through Azerbaijan to the
Mediterranean and European gas network respectively. Filling in the missing
links, cross-Caspian oil and gas pipelines, would complete the ‘Middle
Corridor,’ a new Silk Road for molecules.”
“The Middle Corridor would give Kazakhstan and
Turkmenistan the export optionality they seek, allow them to accelerate
investment in their resource, and boost the availability of supply and energy
security importing countries need. Azerbaijan, meanwhile, would capture
valuable tariff revenues, and strengthen its position as a strategic linchpin
all along the corridor.”
Obstacles include the complexity
of multiple government cooperation, the viability of Europe signing long-term
contracts, and how it will be financed, whether by governments or industry, or
both.
As noted, Kazakhstan also contains
significant amounts of several critical minerals which are in high demand.
Investments to develop those resources, including significant U.S. investments,
are ongoing. Both China and the West are interested in these resources.
References:
Unleashing
the Caspian’s potential in oil, gas and critical minerals: A new Silk Road for
molecules. Simon Flowers, Malcolm Forbes-Cable, Ian Simm, and Craig Saunders.
October 9, 2026.
Unleashing
the Caspian’s potential in oil, gas and critical minerals | Wood Mackenzie
The
Middle Corridor Offers a Much Faster Overland Trade Route from China to Europe:
Is Russia Stalling It Through the Georgian Government, and Are Proposed
Alternate Routes Feasible? Kent Stewart, Blue Dragon Energy & Environmental
Blog. May 4, 2026. Blue
Dragon Energy & Environmental Blog 2.0: The Middle Corridor Offers a Much
Faster Overland Trade Route from China to Europe: Is Russia Stalling It Through
the Georgian Government, and Are Proposed Alternate Routes Feasible?
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