The latest act in the opera that is Eurasian pipeline geopolitics was a so-called informal Caspian summit outside the Kazakh port city of Aktau.

The closed-door agenda-less meeting in September, between the leaders of Azerbaijan, Kazakhstan, Russia and Turkmenistan was closely watched by Turkey and a number of Eastern European countries. What do all these actors have in common? A stake in the infamous Nabucco natural gas pipeline.

A lavish signing ceremony for the project was staged in Ankara in July. But the agreement to build the strategic route to bring Caspian and possibly Middle Eastern gas to European consumers beyond Russian control was only signed by consumer and transit countries. Potential producers, such as Turkmenistan – those with the resources to actually fill the pipeline – were left out, to await individual agreements tied to different phases of construction.

Since the Nabucco concepts originated, Azerbaijan and Turkmenistan have been seen as the most likely producers which would allow the diversification of European gas imports away from overdependence on Russia. Baku’s Caspian gas would fill the initial reduced-capacity Nabucco line, while its full 31 billion cubic meters a year would begin to flow once Turkmen offshore resources were connected to the western shore of the Caspian.

Carts and Horses

The construction of such a trans-Caspian pipeline seemed likely even before Nabucco gained momentum, but the project fell apart because of a lack of commitment from Brussels and Washington. Western policymakers, in conjunction with international energy companies, expected Azerbaijan and Turkmenistan to commit state funds to a major undersea project, without guarantees by the European Union or Turkey that the Caspian gas would be purchased at competitive prices. If that attempt put the cart before the horse, July saw an agreement to build a cart, without a horse to pull it.

In the past few months, however, it seemed as if Turkmenistan was back in the game. Despite lucrative offers from Russia, China and Iran, Turkmen President Gurbanguly Berdymukhammedov nurtured good relations with Azerbaijan, sent an envoy to Brussels and his foreign minister to Washington to signal his country’s commitment to a western-oriented project such as Nabucco. But then, all the progress was suddenly stymied.

Just after the Nabucco signing ceremony, talks between Azerbaijan and Turkmenistan on dividing resources on the Caspian seabed angrily fell apart, with Berdymukhammedov publicly accusing Baku’s negotiators of ‘intransigence’. So far apart were the two sides, he said, that Turkmenistan would seek to have the matter resolved by international arbitration.

This breakdown plays right into the hands of Moscow, which has long argued that energy infrastructure cannot cross the Caspian unless legal arrangements are agreed by all countries which share the shoreline, including Iran.

More than any other country, Iran has derailed the process of resolving the Caspian’s status by doggedly demanding fourteen percent of the seabed; more than it would receive in most realistic alternatives.

Largest Energy Hub

It may well be Iran that benefits most fromthe Azerbaijani-Turkmen flare-up with regards to Nabucco. The project’s most significant transit state, Turkey, has long argued that Iran’s immense gas resources, the second-largest in the world, should figure prominently as a source of supply to diversify European imports. In late August the Turkish media widely publicised a rash of energy deals with the EU, Russia, Qatar, Azerbaijan and Syria that added to Turkey’s earlier gains to make it the ‘world’s largest energy hub’.

Even without major resources of its own, the Anatolian region of Turkey is strategically positioned amongst the world’s largest natural gas resources: Russia, Iran, the Caspian region, and the Middle East, and next door to one of the world’s largest markets for gas: the EU.

Were the Nabucco pipeline to fork and tap into Azerbaijani, Turkmen and Iranian reserves, Turkeywould not only boost its status as an energy hub, but gain significant leverage on energy issues in its EU membership bid.

That said, United States officials rightly slap down aspirations for energy links to Iran, arguing that the international dispute over Tehran’s nuclear ambitions must be resolved before tapping into its reserves becomes a viable option.

Ankara is not likely to get its wish unless US, European and Turkish diplomats can coordinate to make natural gas imports a lucrative incentive for Iran to quietly close its nuclear programme. But transatlantic unity of purpose on energy and security policy regarding Turkey and Iran seems a tall order when EU member states cannot agree on the basics of an international energy policy.

However, on the same day that Azerbaijan and Turkmenistan turned their backs on each other, Iran’s oil minister announced that Tehran has identified 46 newfields in the southern Caspian. While these are oil, not gas, they boost Iran’sprofile as a producer country and lure away from the middle-Caspian European energy companies itching to get into the Iran game early.

Middle East Moves

Iranian gas may well provide European consumers with heat if Tehran’s nuclear preferences change, but the Nabucco project as we know it is likely to fall apart if a full-capacity supplier cannot be found before then. For that reason, it is worth noting not just the signatories, but the attendees at July’s transit agreement ceremony.

Egypt’s oil minister recommended that Nabucco be linked to the planned Arab gas pipeline to bring Egyptian gas to Europe. Iraq’s Prime Minister, Nouri Al Maliki, not only attended, but announced his government’s intention to link Iraqi fields to Nabucco.

Given uncertainties in the Caspian, European gas diversification may well end up coming from the Middle East. Either way, decision-makers in Brussels and Washington, together with their private sector counterparts in the Nabucco consortium, had better get serious about wooing producer countries to sign on to the project. Caspian resources are not there for the taking.

Alexandros Petersen is a nonresident senior fellow with the Atlantic Council’s Dinu Patriciu Eurasia Center.  This essay was previously published as “Gas for the Nabucco Pipeline: Energy Aria” in The World Today, a Chatham House publication.