C O N F I D E N T I A L MANAMA 000520

SIPDIS

SIPDIS

E.O. 12958: DECL: 06/07/2017
TAGS: ETTC EPET ENRG PREL BA IRQEGION ECTRD
SUBJECT: BAHRAIN: IRAN SANCTIONS ACT AND REPORTS OF
NATURAL GAS PROJECT

REF: A. STATE 74354

B. MANAMA 0419

Classified By: Ambassador William T. Monroe for reasons 1.4 (b) and (d)
.


1. (C) Pol/Econ Chief June 7 delivered Ref A demarche
concerning the Iran Sanctions Act and reports of a possible
Bahrain-Iran natural gas project to MFA Assistant Under
Secretary for Coordination and Follow Up Shaikh Abdul Aziz

SIPDIS
bin Mubarak Al Khalifa, noting that the Ambassador had
already discussed the issue with Minister of Oil and Gas
Affairs Mirza (Ref B). Shaikh Abdul Aziz said that from
Bahrain's perspective, "the last place we want to look" for
natural gas is Iran. However, Bahrain is desperate for gas
as fuel for the country's power generation plants, and this
desperation "makes us look at all sources, leaving no stone
unturned."


2. (C) Qatar, Shaikh Abdul Aziz said, is Bahrain's
preferred, logical source for natural gas. But after
extensive consultations, the GOQ told Bahrain that it would
be unable to make a decision until 2009 about the possible
provision of gas in 2010. He said that the Bahraini side had
raised with the GOQ reports that Chevron had canceled a
contract for a large quantity of gas (he thought it was 2,000
trillion cubic feet (tcf)). Bahrain had said it would
purchase 500 tcf, 25 percent of the total. The Qatari
government replied that it could not do it because Qatari
industry needed to use the gas. Bahrain proposed that it
could take just 300 tcf, but the Qataris did not respond.
Shaikh Abdul Aziz asked for USG assistance in convincing
Qatar to sell the gas to Bahrain.


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