CIAO DATE: 02/02

U.S. Policy on Caspian Energy Development and Exports: Mini-Case and Paradigm

Graham Allison and Emily Van Buskirk

May 2001

Belfer Center for Science and International Affairs (BCSIA)

 

Abstract

Drawing on the Caspian Studies Program's ongoing research, my colleague Emily Van Buskirk and I prepared a case on U.S. policy on Caspian energy development and exports for a Kennedy School course I teach with Ambassador Robert Blackwill. Using the case, our sixty students examined central questions including: What is the most effective way to promote the development of Caspian energy resources? What is the proper role of government in large-scale capital projects? Where does the Caspian Basin rank in the hierarchy of U.S. national interests?

A mini-case like the one attached requires students to write a strategic options memo for the president identifying alternatives, pros and cons, and making a recommendation. The attached case starts with the real world today, accelerates developments to a fork in the road, and requires students to analyze and recommend. Specifically, in this hypothetical, the oil companies have completed their detailed engineering study of the Baku-Tbilisi-Ceyhan pipeline route, and concluded that the price for construction will be $3 billion. Pledges from the companies and investors raise $2.5 billion, leaving the project $500 million short on the financing. Given U.S. government affirmations about the Baku-Tbilisi-Ceyhan pipeline as a U.S. priority, the companies seek assistance from the U.S. government. The question is: what to do?

— Graham Allison

U.S. Policy on Caspian Energy Development and Exports: Mini-Case and Paradigm (PDF format)

Color Piplines Map (PDF format)

Front and Back Cover (with maps and acknowledgements) (PDF format)