TURKMENISTAN'S OIL AND GAS AGENCIES NOT YET READY

C O N F I D E N T I A L SECTION 01 OF 02 ASHGABAT 000825

SIPDIS

SIPDIS

STATE FOR SCA/CEN, EUR/RUS, EUR/CARC AND EEB
ENERGY FOR EKIMOFF
COMMERCE FOR HUEPER
PLEASE PASS USTDA (STEIN)

E.O. 12958: DECL: 08/09/2017
TAGS: PREL EPET ENRG PGOV TX
SUBJECT: TURKMENISTAN'S OIL AND GAS AGENCIES NOT YET READY
TO MOVE FORWARD ON USTDA COOPERATION

REF: A. ASHGABAT 810

B. ASHGABAT 550

Classified By: Charge d'Affaires Richard E. Hoagland for reasons 1.4(B)
and (D).


1. (SBU) SUMMARY: Deputy Minister of Oil and Gas Baramgeldy
Nedirov, pinch-hitting for the Minister of Oil and Gas and
other key oil sector officials who were in Kazakhstan,
listened to an August 6 presentation by U.S. Trade
Development Agency (USTDA) Regional Director Dan Stein and
Contractor Bronek Dutkiewicz on what USTDA could do for
Turkmenistan. Nedirov said that he would brief Stein's
proposals upwards, and Turkmenistan would be in touch if
there is interest. While Nedirov's response is not
surprising, given Turkmenistan's top-down decision-making
structure, the much higher-ranking Deputy Chairman of the
Cabinet of Ministers/Foreign Minister, Rashit Meredov, gave a
similar response later that day (Ref A). Dutkiewicz will try
to follow up separately later with State Agency for
Management and Use of Hydrocarbon Resources (State Agency)
Executive Director Bayrammyrat Myradov, who is the official
most likely to throw his support behind USTDA's proposals.Q
END SUMMARY.

TURKMENISTAN'S HYDROCARBON LEADERS UNEXPECTEDLY DECAMP


2. (SBU) USTDA Regional Director for Europe and Eurasia Dan
Stein met August 6 with Nedirov because President
Berdimuhamedov had sent all senior energy officials to
Kazakhstan for the week to negotiate documents for upgrading
the Caspian Littoral and Central Asia Three gas pipelines
agreed to during the May tripartite summit in Turkmenbashy
among presidents Putin, Berdimuhamedov, and Nazarbayev.

USTDA PROPOSES A CONNECTOR PIPELINE FROM BLOC 1


3. (C) Noting that this visit was a follow-on to SCA PDAS
Steve Mann's energy delegation in June, Stein said he was in
Turkmenistan because the government has expressed interest in
cooperating with USTDA. He outlined a number of USTDA
assistance programs in other countries, including training,
providing tools for making strategic assessments, and
carrying out feasibility studies. However, he added, USTDA
wants to tailor its proposals to Turkmenistan's needs, and
therefore, wants feedback from petroleum-sector officials.
USTDA also sees one other possible joint project --
connecting the Petronas-operated Livanov field in
Turkmenistan's Bloc One to Azerbaijan's ACG and Shah-Deniz
pipelines, which would transport at least a small volume of
Turkmenistan gas to Europe. This last program, Stein
stressed, is of particular interest to U.S. and Azeri
officials since, while it is not a complete Trans-Caspian
pipeline (TCP),it would be a start. Pursuing such a route
would be both quicker and require less investment than a full
TCP, since it could take advantage of existing infrastructure
in both Turkmenistan and Azerbaijan. To pursue the connector
pipeline to the ACG/Shah-Deniz line, however, USTDA would
need first to carry out a feasibility study that would
require Turkmenistan's cooperation.

NEDIROV: WE WILL CONSIDER THESE PROPOSALS


4. (SBU) Nedirov responded that President Berdimuhamedov has
"not dismissed" the idea of building alternative pipelines
and the Oil and Gas Ministry will respond when it has had a
chance to consider the connector pipeline proposal. Nedirov
said that he had listened with great interest to Stein,s
other proposals and would report them to his superiors.
Regarding the suggestion that Dutkiewicz meet with oil

ASHGABAT 00000825 002 OF 002


specialists following his trips to the Doveletabad and
Caspian hydrocarbon fields, Nedirov replied that the Turkmen
side would consider the request.

USTDA NEEDS AN ANSWER SOON ON PROPOSED ORIENTATION VISIT


5. (SBU) Stein noted that the U.S. Secretary of Energy had
invited a Turkmenistan hydrocarbons delegation to visit the
United States. He described what the proposed September
22-29 "orientation visit" would look like, including meetings
in Washington with energy sector officials and in Houston
with hydrocarbon companies. He hoped that the Government of
Turkmenistan would respond soon, since planning such a visit
would require time. Nedirov promised to pass on this message.


6. COMMENT: Nedirov's response is not unexpected. In
Turkmenistan, the president, rather than deputy ministers,
makes all key decisions, and information is not widely
disseminated. Indeed, of the four officials flanking
Nedirov, it was only the two (low-level) State Agency
representatives who seemed to have even a clue about the
proposed energy visit or USTDA's reason for visiting
Turkmenistan. Stein confirmed in subsequent meetings with
representatives of foreign hydrocarbon firms that within
Turkmenistan's hydrocarbon bureaucracy Myradov is someone who
has both the vision to do new things and the connections
necessary to help persuade the president that such new
activities are a good idea. With that in mind, EMBASSY is
seeking to arrange a meeting between Myradov and Dutkiewicz
after the State Agency head returns on August 9.
HOAGLAND