TURKEY-GREECE-ITALY PIPELINE - EDISON DISCUSSIONS

UNCLAS ROME 002699 SIPDIS SIPDIS DEPT FOR EUR DAS BRYZA AND EB DAS SIMONS MILAN FOR BROUILLETTE-RODRIGUEZ E.O. 12958: N/A TAGS: EPET ENRG ETRD AJ AL RS TU GR IR IT SUBJECT: TURKEY-GREECE-ITALY PIPELINE - EDISON DISCUSSIONS WITH TURKEY REF: ROME 2698 ¶1. Roberto Poti, Edison Vice President for Business Development, called EconCounselor September 18 to relate details of his September 11 meeting with Turkish Energy Minister Hilmi Guler regarding the Turkey-Greece-Italy (TGI) pipeline construction. ¶2. Poti described the meeting as "very positive." Guler reportedly confirmed the GOT,s commitment to the TGI project and said Turkey wishes to re-open negotiations to formalize a "transit" contract for Azeri gas exported to Greece and Italy via Turkey. Guler said he had spoken with EUR DAS Bryza and told Bryza that Turkey's first priority is completion of the TGI, even if Turkey is only able to participate as a transit country. (Note: As reported reftel, a principal concern for Edison regarding the TGI is Turkey's desire to become not only a transit country for natural gas, but also a seller/distributor. End Note.) ¶3. Guler also said the GOT wants to consider becoming a signatory to the Italian-Greek intergovernmental agreement regarding the TGI as a way to speed completion of the pipeline. (Note: This bilateral framework agreement, signed November 4, 2005, commits both governments to spur TGI completion by quickly providing all the necessary government permits. Our understanding is that the agreement does not address how the construction will be funded. End note.) ¶4. On the issue of what gas the TGI will carry, Guler reportedly told Poti that Turkey places a priority on the TGI's carrying Azeri natural gas, and specifically stated that the GOT "would have problems" with the export of Iranian natural gas via the TGI. SPOGLI