Joint Communique on the oil and Gas Resources of the Caspian Sea Basin March 2,1998

1. The Foreign Ministers of Azerbaijan, Georgia, Kazakhstan, Turkmenistan and Turkey convened at a meeting held in Istanbul, on 1-2 March 1998, hosted by H.E. Mr. İsmail Cem, Minister of Foreign Affairs of the Republic of Turkey, and discussed the matters concerning the developments, production and exploitation of the oil and gas resources of the Caspian Sea basin, and their transportation to international markets through pipelines.

2. Taking into consideration the importance of these resources for the consolidation of independence, security and economic development of their countries and the prosperity of their people, the Ministers confirmed the significance of transporting these resources to international markets in safety through economically and commercially feasible multiple oil and natural gas pipelines.

3. The Ministers particularly emphasized the importance of transporting oil and natural gas to international markets through pipelines for ecological reasons. They greeted with understanding the environmental concerns of Turkey stemming from the over-burdened state of the Turkish Straits due mainly to heavy traffic. They acknowledged the need to ensure effectively the safety of navigation there in not only for the inhabitants of Istanbul, but also for countries commuting through these Straits intensively.

4. In view of the afore-mentioned objectives, the Ministers jointly expressed their conviction that the construction of an East-West Corridor for transportation of oil and natural gas to international markets from the Central Asia, the Caspian Sea basin, and the Caucasus to the West through multiple pipelines, particularly via Azerbaijan, Georgia and Turkey, shall meet not only the national expectations of the energy supplying states, but shall also address the requirements of the transit and consumer countries.

5. The Ministers were informed of a feasibility study to be concluded on the Caspian-Mediterranean Bakü-Ceyhan Oil Pipeline Project, the implementation of which bears utmost importance in terms of the above-mentioned considerations. The Ministers agreed to identify possible contributions of their countries to this project.

6. Taking into consideration the infrastructure for this oil pipeline project, the Ministers expressed the view that an impetus should also be given to the work on transporting the oil and natural gas of the Caspian Sea basin, especially that of Kazakhstan and Turkmenistan through pipelines connecting both shores of the Caspian Sea, and by other means, to international markets.

7. The Ministers elaborated on the need to carry out feasibility studies as a firs step for the implementation of the Trans-Caspian oil and natural gas pipeline projects. The Ministers agreed to determine the terms of reference of the feasibility studies and to conclude them as soon as possible. The Ministers studied carefully the information about the ongoing feasibility study concerning the transportation of the Turkmen natural gas through Iran to Turkey.

8. The Ministers stressed that the present political considerations and the technical, financial, commercial and legal issues for the realization of the said oil and natural gas pipeline projects should be addressed with a view to finding lasting solutions. Pointing out that such an approach is important for both the third countries involved in these projects, as well as, the private companies intending to invest in the region, the Ministers underlined the necessity to create a commercially attractive environment for investments.

9. The Ministers stated that the status of the Caspian Sea should be determined by an agreement among littoral states, based on the principles of international law on just and equitable basis and on methods of international practice. In this context, the Ministers supported the recent positive developments concerning the negotiations for the demarcation of national sectors of the littoral states.

10. The Ministers agreed to organize follow-up meetings to continue their joint efforts aiming to realize the above-mentioned projects. They took note of an invitation of the Foreign Minister of Georgia, H.E. Mr. Irakly Menagarishvily to hold next meeting in Tbilisi.

11. The Ministers thanked H.E. İsmail Cem the Ministers of Foreign Affairs of the Republic of Turkey for hosting this meeting.