TBILISI/ANKARA A bid by Turkey and Armenia to bury a century of hostility and open their border faces collapse under the weight of a simmering territorial conflict neither side can ignore.

Barely three months since the accords were signed with the endorsement of the US, European Union and Russia, Yerevan and Ankara are accusing each other of trying to re-write the texts.

The deal would bring big economic gains to poor, landlocked Armenia. Turkey would burnish its credentials as a potential EU entry state and boost its clout in the South Caucasus, a region criss-crossed by pipelines carrying oil and gas to the West.

But Turkey has demanded that ethnic Armenian forces pull back from the frontlines of the disputed mountain region of Nagorno- Karabakh as a condition for ratifying the peace deal.

This has aroused fierce resistance in Armenia.

The Turkish condition is aimed at placating close Muslim ally Azerbaijan, an oil and gas exporter which lost control over Nagorno-Karabakh when ethnic Armenians backed by Christian Armenia broke away as the Soviet Union collapsed.

Using energy reserves coveted by Russia and the West as leverage, Azerbaijan has condemned the peace deal, which would see Turkey re-open its frontier with Armenia.

Ankara closed the border in 1993 in solidarity with Azerbaijan during the Nagorno-Karabakh war.

“Turkey has mortgaged its foreign policy to Azerbaijan,”

said Hugh Pope of the International Crisis Group think-tank.

“It sold the Turkey-Armenia accords as part of its 'zero problems with neighbours' policy, but now the Azerbaijan lobby and some hundreds of millions of dollars in oil is challenging all that rhetoric.”

A senior Western diplomat said he was “very concerned” about the fate of the peace process. “We are clearly in a worse situation than we were even a short time ago,” he told Reuters.

The deal is the closest the sides have come to overcoming the legacy of the mass killings of Armenians blamed on Ottoman Turks during World War One, a defining element of Armenian national identity and a constant thorn in the side of modern Turkey.

Under the accords, Armenia and Turkey agreed to establish diplomatic ties and open their common border within two months of parliamentary approval, which is still to come.

Oil and gas

But the accords made no mention of Nagorno-Karabakh. Armenia and Turkey committed to a historical commission to investigate the WWI massacres, which Armenia — backed by several European states and many independent historians — says was genocide.

Turkey vehemently rejects the term, saying many Muslims as well as Christians died in partisan fighting.

But the backlash by Azerbaijan, seen by many Turks as their brother nation, has deepened political divisions in Ankara.

Azerbaijan has begun selling gas to Russia and Iran, and is seeking to hike the price of supplies to Turkey. Azeri gas is essential if the EU-backed Nabucco pipeline is ever to be built to reduce Europe's energy dependence on Russia.

Following the furious Azeri reaction to the peace deal Turkey rowed back, saying it would only ratify the pact if the Armenians withdraw from Azeri districts captured during the war as a land corridor between Nagorno-Karabakh and Armenia.

With resentment towards Turkey already on the rise among Armenian nationalists and the powerful Armenian diaspora, analysts say President Serzh Sarksyan could face a bid to unseat him if he plays along with Ankara's demands.

The Nagorno-Karabakh conflict, which killed some 30,000 people, has resisted more than 15 years of slow-paced mediation.

“The impasse was completely predictable and a result of the total neglect of the Armenian-Azerbaijan conflict and trying to hope against better judgement that you could de-link the Turkish-Armenian relationship from the Karabakh conflict,” said Svante Cornell of the Central Asia-Caucasus Institute.

To complicate matters further, Turkey last week accused Armenia of trying to re-write the deal with a court ruling reaffirming the state's constitutional obligation to pursue recognition of the massacres and deportations as genocide.

Analysts say pressure could mount as the 95th anniversary nears in April, when Armenians will again press US President Barack Obama to fulfil a campaign pledge to label the killings as genocide.

US, Russian and French mediators in the Nagorno-Karabakh conflict are pushing for agreement on the principles of a peace deal which would satisfy Turkey.

But this is proving almost impossible and the most recent meeting of Sarksyan and Azeri President Ilham Aliyev in the Russian city of Sochi on Monday gave little cause for hope.

“For Turkey to link the accords to Nagorno-Karabakh is going to make the process very difficult because it might take decades,” said Pope.—Reuters