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Prepared by the
Institute for the Analysis of Global Security

March 28, 2005
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Energy Security Current Issue

What the 9/11 Commission missed
One of the main conclusions of the 9/11 Commission is that in order for the U.S. to prevail in the war on terror it must develop a multidisciplinary, comprehensive, and balanced strategy, which integrates diplomacy, intelligence, covert action, law-enforcement, economic policy, foreign aid, homeland defense, and military strength. IAGS' Gal Luft argues that a key component is missing.

The Connection: Water and Energy Security
Allan Hoffman, former associate and acting deputy assistant secretary for Utility Technologies in the Office of Energy Efficiency and Renewable Energy of the DOE and IAGS Advisor, explains why water and energy security are inextricably linked.


Saudi Arabia in Crisis
IAGS' Anne Korin presented a strategy for reducing U.S. dependence on Saudi oil as part of a conference hosted by the Hudson Institute on July 9, 2004. Watch the event (Anne's presentation starts at 02:38:35.)

On the technology front How utilities can save America from its oil addiction
Utility companies which have traditionally viewed themselves as providers of "power" for lighting homes or powering computers, can now break the dominance of Big Oil in the transportation energy sector and introduce much needed competition in the transportation fuel market. Gal Luft explains how.

Comparing Hydrogen and Electricity for Transmission, Storage and Transportation

Study: Coal based methanol is cheapest fuel for fuel cells
A recently completed study by University of Florida researchers for the Georgetown University fuel cell program assessed the the future overall costs of various fuel options for fuel cell vehicles. The primary fuel options analyzed by the study were hydrogen from natural gas, hydrogen from coal, and methanol from coal. The study concluded that methanol from coal was the cheapest option, by a factor of almost 50%.

Major improvement in fuel economy and range of Honda's fuel cell vehicles
The 2005 model Honda fuel cell vehicle achieves a nearly 20 percent improvement in its EPA fuel economy rating and a 33 percent gain in peak power (107 hp vs. 80 hp) compared to the 2004 model, and feature a number of important technological achievements on the road to commercialization of fuel cell vehicles.

Biodiesel fueled ships to cruise in Canada
A Canadian project will test the use of pure biodiesel (B100) as a fuel supply on a fleet of 12 boats of various types and sizes, 11 boats on pure biodiesel (B100) and one on a 5-percent blend (B5).

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Back Issues

Pipeline sabotage is terrorist’s weapon of choice

Until recently, the pipeline industry has been preoccupied primarily with environmental, safety and maintenance issues. Beyond occasional cases of vandalism, the human factor was hardly perceived as a threat to the world’s vast web of oil and gas pipelines, which, all told, carry roughly half of the world’s oil and most of its natural gas.

This has changed since September 11. With the threat of terrorism looming, pipeline operators in the industrialized world have taken action to prevent terrorism from harming energy infrastructure with steps that include:

  • Increasing system redundancy,
  • Deploying state-of-the-art surveillance equipment,
  • Deploying aerial and ground patrols, and
  • Fortifying pipeline systems against cyber-security breaches.
All these have made the pipeline system in places like North America and Europe relatively secure. But since most U.S. oil and a growing portion of its natural gas come from abroad our energy system cannot be protected unless similar security measures are applied at the generating points of oil and gas in the Middle East, the Former Soviet Union, Africa and Latin America.

Unfortunately, the security situation in those parts of the world where terrorists are known to operate leaves much to be desired. In fact, terrorists no longer need to come to the U.S. in order to wreak havoc in our energy system. They can achieve the same degree of damage by going after energy targets in their home base where they enjoy support on the ground.

In mid-December 2004, Arab satellite channels aired an audiotape message by Osama bin Laden in which he called on his cohorts to take their holy war to the oil industry and to disrupt supplies to the U.S from the Persian Gulf.

Two days later a follow-up statement by the Saudi branch of al Qaeda was published, calling on “all mujahideen ... in the Arabian Peninsula” to target “the oil resources that do not serve the nation of Islam.” These statements reflect the reality of the post-September 11 world in which terrorist groups have identified the world’s energy system, “the provision line and the feeding to the artery of the life of the crusader nation,” in the words of al Qaeda, as the Achilles heel of the West. Throughout the world the jihadist message is gradually being heeded and it is becoming increasingly apparent that a new chapter in the war on terror is looming on the horizon and that its primary targets are oil and gas pipelines.

Weapon Of Choice

Pipelines are very easily sabotaged. A simple explosive device can put a critical section of pipeline out of operation for weeks. This is why pipeline sabotage has become the weapon of choice of the insurgents in Iraq.

Since President Bush declared the end of major hostilities in April 2003, there have been close to 200 pipeline attacks. According to the Iraq Pipeline Watch at the Institute for the Analysis of Global Security, most of the attacks took place in northern Iraq, primarily on the pipeline running from Kirkuk to the Turkish Mediterranean terminal of Ceyhan.

In addition, there have been dozens of attacks on oil and gas pipelines leading to the refineries around Baghdad, primarily near the Bayji refinery complex 125 miles north of Baghdad. In March 2004, terrorists began striking at oil installations in the south near Basra as well, where more than two-thirds of Iraq’s oil is produced. The attacks have exacted a heavy price from the new Iraqi government— it is estimated that pipeline sabotage costs the country more than $10 billion in oil revenues — and have undermined the prospects of Iraqi construction.

Such attacks also have a corrosive influence on the morale of the Iraqi people and their attitude toward the presence of U.S. forces in their country. Iraqis are growing increasingly vexed by the coalition’s slow progress in the reconstruction effort and its inability to guarantee a reliable supply of electricity, which is primarily derived from oil. Worse, the sabotage campaign has created an inhospitable investment climate in Iraq and scared away oil companies that were supposed to develop its oil and gas industry.

Emulating the success of the saboteurs in Iraq, terrorists in many oil-producing countries have set their sights on pipelines and other oil installations. In December 2004, Sudanese rebels attacked an oil field, killing 15 people. “This was our first military operation and we chose the oil fields because this is the wealth of Sudan, which this government is not sharing with all of its people,” said Ali Abd al-Rahim al Shindy, leader of the group that carried out the attack.

Chechen guerrillas fighting to sever themselves from Russia are going after the country’s gigantic pipeline web of roughly 31,000 miles. Russia is the world’s second-largest oil exporter and 40% of its revenues are derived from oil. There is no better way for the Chechens to hurt the Russian economy than hindering Russia’s capability to export crude. In 2004, pipelines were blown up in Volograd, Dagestan, Stavropol as well as in and around Moscow.

In India, a separatist rebel group called United Liberation Front of Asom (ULFA), which fights for independence for oil-rich Assam state, has taken responsibility for a number of pipeline attacks. Assam is the source of some 15% of India’s onshore crude oil production and, as the country’s oil demand grows, the implications of disruption of the flow of oil from there will become increasingly noticeable.

In southeast Turkey, Kurdish guerrillas belonging to the Kurdistan Workers Party (PKK) have staged a campaign of bomb attacks on an oil pipeline.

In Colombia, terrorist groups, primarily the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN,) have attacked the 480-mile Cano Limon-Covenas oil pipeline so many times that it became known as “the flute.”

The campaign against the world’s vulnerable pipelines is likely to continue to spread to new territories. Terrorists have already indicated interest in the nearly completed 1,000-mile Baku-Tbilisi-Ceyhan (BTC) pipeline, slated to transport 1 million barrels of oil a day from the Caspian Sea to Western markets through the Turkish port of Ceyhan. The pipeline is expected to be operational by the end of 2005 but even before construction ends, terrorist elements may already be planning attacks on it. According to Azerbaijan’s National Security Minister, Namiq Abbasov, the country’s special services had obtained information that regional insurgents and members of al Qaeda are planning acts of sabotage against the pipeline.

Another problematic area in the pipeline’s path is Georgia, where separatists in South Ossetia and Abkhazia provinces often clash with the Georgian government. In addition, there is increasing threat by Islamist groups operating in the Caucasus such as the Islamic Party of Eastern Turkestan, the Islamic Movement of Uzbekistan (IMU), Chechen separatists and Hizb-ut-Tahrir al-Islami. The latter group seeks to seize power and supplant existing governments with a sharia-based caliphate for the purpose of jihad against the West.

China, the world’s fastest growing energy consumer, is also vulnerable to terrorist strikes against oil. To satisfy its growing energy needs, China has decided to run pipelines connecting the northwest district of Xinjiang with neighboring Kazakhstan. This means China’s oil will be at the mercy of increasingly hostile Muslim Uighur minorities trying to break away from the central regime in Beijing.

But in no oil and gas domain could pipeline sabotage do more damage than in Saudi Arabia, home to one-fourth of the world’s oil. Over 10,000 miles of pipeline crisscross Saudi Arabia, mostly above ground. Were concerted pipeline attacks to spread to Saudi Arabia, repeatedly interrupting the Saudi oil supply, the implications for the global economy could be profound.

Not all pipeline sabotage is politically driven. Thieves often pilfer fuel from pipelines for personal use or to sell on the black market. Such activity sometimes ends tragically. In 1998, more than 1,000 villagers in Nigeria died when a ruptured gasoline pipeline exploded as they scavenged fuel.

Fear Premium

Whether perpetuated for political or criminal reasons, assaults on oil infrastructure have added a “fear premium” of roughly $10 per barrel of oil.

The cause and effect are not lost on terrorists whose goal, feasibility aside, is to bankrupt the U.S. “The killing of 10 American soldiers is nothing compared to the impact of the rise in oil prices on America and the disruption that it causes in the international economy,” exhorted one jihadist website. For the U.S., which imports more than 10 million barrels a day, the spike in oil prices due to oil terror cost close to $40 billion in 2004.

Governments, oil companies and pipeline operators are seeking to put in place mechanisms to reduce the impact of the scourge. The most effective way to address the scourge of sabotage is to confront terrorists wherever they are. This is already being done by most countries as part of the global war on terror. By pursuing jihadists and separatist groups, denying them freedom of operation and destroying their infrastructure, governments can reduce the number of attacks.

The most obvious way to increase pipeline security is the use of patrols and the creation of buffer zones along the pipeline routes into which unauthorized personnel are prohibited from entering. In Iraq, close to 14,000 security guards have been deployed along the pipelines and in critical installations. But ground patrols are only effective to a certain degree, especially in areas of inclement weather and forbidding terrain.

Another way to reduce pipeline sabotage is by paying tribes and powerful warlords to protect the pipes on their territory. This method was tried in Iraq with limited success. Rival tribes would often blow up a pipeline and then claim to be more deserving of the protection money.

Sensing Systems

Technology could also play an important role in the effort to secure pipelines. Sophisticated surveillance systems to enhance infrastructure security can be deployed in critical locations. New technologies for seismic sensing of underground vibrations can provide early warning when saboteurs approach the protected area. Such systems may be expensive, but by making possible the remote monitoring of much of the pipeline network, governments can eliminate the need for large numbers of troops and instead rely on smaller numbers of rapid-response teams.

Such systems can also be complemented by air surveillance. As a result of progress in high-resolution remote sensing and image processing technology, it is now possible to deploy small and medium-size unmanned aerial vehicles (UAVs) and unmanned helicopters for pipeline inspection purposes. These UAVs can stay in the air up to 30 hours at medium-to-low altitudes, and can send images to a central control station where they can be reviewed by security teams. Some defense contractors are developing UAVs mounted with automatic weapons to be used against saboteurs.

Unfortunately, many of the countries where such technologies would be most effective are too poor to afford them. Under such circumstances governments and pipeline operators that cannot prevent attacks altogether should invest in mechanisms to minimize the damage attacks can cause. The cheapest and most effective way to protect an existing pipeline is to prevent easy access by surrounding it by walls and fences. New pipelines should be buried. While this may substantially increase construction cost, in areas where saboteurs are known to operate the investment will quickly pay for itself. This is the reason the BTC has been completely covered from the outset.

New technologies can fortify pipes with external carbon fiber wrap that can mitigate the affects of explosive devices. Equally important is to shorten the lead time between the attack and the repair. The quicker it takes to repair the damage, the lower the cost of the disruption. Pipeline saboteurs often target pipelines at critical junctions or hit custom-made parts that take longer to replace. To reduce the lead time, pipeline operators should be equipped with sufficient inventories of spare parts.

It is important to realize that none of the approaches discussed here is likely to put an end to the problem. As long as oil and gas continue to be essential to the functioning of the world’s economy, pipeline sabotage is likely to remain one of the industry’s risks. No matter what remedy is applied, it will add a surcharge to the price of a barrel, which is already unusually high.

Gal Luft is executive director of the Institute for the Analysis of Global Security (IAGS). This article was originally published in Pipeline & Gas Journal.