PRESENTING DEPARTMENT REACTION TO MFA VOLUNTARY

UNCLAS ANKARA 002075 SIPDIS SENSITIVE STATE FOR EB/CBED AND EUR/SE NSC FOR BRYZA E.O. 12958: N/A TAGS: EPET EWWT PREL SENV TU SUBJECT: PRESENTING DEPARTMENT REACTION TO MFA VOLUNTARY PRINCIPLES PROPOSAL REF: A. (A) STATE 73545 ¶B. (B) ANKARA 1060 (SBU) A/DCM presented Department's reaction (ref A) on the MFA's voluntary principles proposal to MFA Deputy Director General for Energy Hakki Akil on April 5. Akil expressed appreciation for the USG interest and comments. He stressed that the MFA proposal was not intended in any way to weaken or contravene the Montreaux Convention, and that the MFA shared the U.S. view that market forces had to lead pipeline development. He reiterated that the fundamental purpose of the proposal was to help the oil companies get out of their current dilemma, in which they understand the commercial need to develop bypass pipelines but do not take the initiative for fear they will end up subsidizing their "free riding" competitors (who would benefit from the reduced crowding in the straits). Akil promised to study the Department's comments in more detail, and looked forward to continuing the dialogue. EDELMAN