QATAR-BAHRAIN GAS PIPELINE: BAHRAIN REMAINS

C O N F I D E N T I A L MANAMA 000816

SIPDIS

E.O. 12958: DECL: 06/08/2015
TAGS: EPET PREL BA QA
SUBJECT: QATAR-BAHRAIN GAS PIPELINE: BAHRAIN REMAINS
OPTIMISTIC

REF: A. DOHA 934 B. MANAMA 692

Classified By: Ambassador William T.Monroe. Reason: 1.5 (B)(D)


1. (SBU) Ref B reported indications from Bahrain that Bahrain
and Qatar had concluded a framework agreement on an agreement
for Qatar to supply Bahrain with natural gas via a pipeline,
and that GOB officials were confident that the project would
soon move forward. Ref A quoted Qatari officials as saying
that there were in fact no immediate plans to move forward on
the deal, and that the press reports were more designed as
political gestures to demonstrate sound relations between the
two countries.


2. (C) Ambassador, in a June 7 discussion with Minister of
Industry Hassan Fakhro, asked about the proposed pipeline,
stating that we had indications from Qatar that the deal
might not be quite as imminent as Bahrain press reports had
indicated. Fakhro, a close confidant of the King, was
emphatic that the deal is moving forward, saying that it had
been sealed in a very private and unpublicized weekend visit
several weeks ago by the Emir of Qatar, who had stayed at the
palace with King Hamad. With the Emir's backing, Fakhro was
confident that the contract details, including price, would
be worked out.


3. (C) Separately, Foreign Minister Shaikh Mohammed bin
Mubarak Al-Khalifa sounded a similar line, telling the
Ambassador that Bahrain now has excellent relations with
Qatar, and the parties were now negotiating the price for the
natural gas deal. Shaikh Mohammed commented that "the warmer
the relationship, the less cost matters" to the Qataris. He
noted that planning for a causeway between the two countries
was also moving forward positively.


4. (C) Comment. We are well aware that the positive
soundings we are hearing in Bahrain are at odds with what our
colleagues in Doha are hearing. Bahraini optimism comes in
the context of a continued improvement in bilateral
relations, and a real need for the gas. Whether Bahrain's
optimism is well placed, or is a misreading of the Qatari
position, remains to be seen.
MONROE