TURKISH MFA REQUESTS USG REACTION TO IDEA OF

C O N F I D E N T I A L SECTION 01 OF 02 ANKARA 001542

SIPDIS


STATE FOR EB/CBED AND EUR/SE


E.O. 12958: DECL: 03/15/2014
TAGS: EPET EWWT PREL SENV TU
SUBJECT: TURKISH MFA REQUESTS USG REACTION TO IDEA OF
VOLUNTARY PRINCIPALS ON OIL TANKER TRANSIT THROUGH STRAITS


REF: ANKARA 1061


(U) Classified by DCM Robert Deutsch. Reasons: 1.4 (b and
d).



1. (U) This is an action request -- see para 8.



2. (C) Summary: MFA Director General for Energy Hakki Akil
asked March 12 for an initial USG reaction to the Ministry's
initiative (reftel) to obtain agreement on voluntary
principles committing oil companies to reduce the flow of oil
through the Turkish straits. Akil provided a copy of a draft
voluntary principles paper, which he said he had drafted with
the assistance of BP. The MFA's goal is to sign the
agreement at the Istanbul Summit in late June. As an
intermediate step, the GOT plans to meet with major oil
companies in April to discuss the best way to approach the
Russians. Prior to that meeting, the Ministry would welcome
the USG's initial reaction to the idea as well as any
specific comments suggestions on the draft paper and/or on
how best to approach the Russians. End Summary



3. (C) MFA Director General for Energy Hakki Akil called in
EconCouns March 12 to follow up on his earlier discussion
(reftel) about a GOT initiative to reduce, voluntarily, the
flow of oil through the Turkish straits. Akil said the
initiative reflected growing Turkish concern about the
environmental, safety, and health risks associated with the
rising volume of oil being transported through the straits.
The amount had increased from 60 million tons in 1996 to
134.6 million tons in 2003. In the MFA's view, an accident
involving one of the tankers is all but inevitable, and the
result would be disastrous both for Istanbul and for energy
markets.



4. (C) Akil argued that the major oil companies realize that
pushing ever-increasing numbers of oil tankers through the
straits is not a viable option, and that the solution lies in
greater use of routes that bypass the straits. However, the
companies are reluctant to invest in alternative routes --
adding to their costs -- for fear that they would in effect
subsidize competitors by alleviating tanker traffic in the
straits (i.e., the "free rider" problem).



5. (C) To get around this problem, the MFA wants to bring
relevant parties together around a set of "voluntary
principles" for using bypass routes. Akil stressed that this
initiative is not designed to impose any restrictions on
transit through the straits, nor is it meant to press for a
specific bypass route. Rather, it is meant to lay the
groundwork for commercial decisions by the oil companies.



6. (C) Akil provided us with a copy of a draft set of
voluntary principles (which we are faxing to EB/CBED),which
he drafted with the assistance of BP. The draft lays out the
problems associated with increased use of the straits, and
commits the companies to:


-- work together to quantify the cost of incremental shipping
delays to oil producers and to refiners who are forced to buy
alternative crude oil as a result of such delays and lost
production;


-- give priority to maximizing the use of existing bypass
routes;


-- facilitate and support the development of new bypass
routes;


-- use all available capacity in bypass routes prior to
shipping crude through the straits.



7. (C) Akil said he had discussed this initiative with BP,
Chevron-Texaco, Shell, and others, who ranged from
enthusiastic to mildly supportive. He has not yet raised
this with Russian companies or with other governments (though
he plans to raise with the UK shortly). The MFA plans to
chair a meeting of the major oil companies in April to talk
about next steps, specifically how best to approach and win
the support of the Russian oil companies. Prior to that
meeting, he would welcome any initial USG comments or
suggestions on the proposal as well as on the specifics of
the draft text. Akil added that the Ministry's goal is to
organize the signing of the voluntary principles at the
end-June NATO Summit in Istanbul.



8. (C) Comment and action request: The MFA is right that
there is a need to find alternatives to ever-increasing flows
of oil tankers via the straits, so we believe this initiative
warrants serious attention and review. Embassy would
appreciate Washington's initial reaction to the idea, as well
as any specific comments or suggestions we could pass to the
Foreign Ministry.


EDELMAN