Identifier
Created
Classification
Origin
07RIYADH1519
2007-07-18 09:40:00
CONFIDENTIAL
Embassy Riyadh
Cable title:  

AMBASSADOR FRAKER MEETS PRINCE ABDULAZIZ ON NOPEC,

Tags:  EINV ENRG EPET VE SA 
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VZCZCXRO5732
OO RUEHDE RUEHDIR
DE RUEHRH #1519/01 1990940
ZNY CCCCC ZZH
O 180940Z JUL 07
FM AMEMBASSY RIYADH
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6036
RHEBAAA/DEPT OF ENERGY WASHINGTON DC IMMEDIATE
INFO RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE PRIORITY
RUEHHH/OPEC COLLECTIVE PRIORITY
RUEHCV/AMEMBASSY CARACAS PRIORITY 0040
RUEHMO/AMEMBASSY MOSCOW PRIORITY 0684
RUEHTRO/AMEMBASSY TRIPOLI PRIORITY 0015
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUEKDIA/DIA WASHINGTON DC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
C O N F I D E N T I A L SECTION 01 OF 04 RIYADH 001519 

SIPDIS

SIPDIS

DEPT OF ENERGY PASS TO MWILLIAMSON, AHEGBURG, GPERSON, AND
JHART
DEPT OF TREASURY FOR A/S CLOWERY

E.O. 12958: DECL: 07/17/2017
TAGS: EINV ENRG EPET VE SA
SUBJECT: AMBASSADOR FRAKER MEETS PRINCE ABDULAZIZ ON NOPEC,
LAWSUIT ISSUES

REF: RIYADH 1475

RIYADH 00001519 001.2 OF 004


Classified By: ADCM David Rundell for reasons 1.4
(b) (c) and (d).

C O N F I D E N T I A L SECTION 01 OF 04 RIYADH 001519

SIPDIS

SIPDIS

DEPT OF ENERGY PASS TO MWILLIAMSON, AHEGBURG, GPERSON, AND
JHART
DEPT OF TREASURY FOR A/S CLOWERY

E.O. 12958: DECL: 07/17/2017
TAGS: EINV ENRG EPET VE SA
SUBJECT: AMBASSADOR FRAKER MEETS PRINCE ABDULAZIZ ON NOPEC,
LAWSUIT ISSUES

REF: RIYADH 1475

RIYADH 00001519 001.2 OF 004


Classified By: ADCM David Rundell for reasons 1.4
(b) (c) and (d).


1. This is an action request. Please see paragraph six.

--------------
SUMMARY
--------------


2. (C) In a July 16 meeting with Ambassador Fraker, HRH
Deputy Minister of Petroleum (MinPet) Prince Abdulaziz bin
Salman bin Abdulaziz Al-Saud continued to underscore his
concern with on-going lawsuits against Saudi Aramco and
pending NOPEC legislation. He reminisced about his twenty
good years handling the U.S. account for the MinPet, noting
that there were many "more question marks" now. Prince
Abdulaziz continued to press for the USG to file "statement
of interests" (SOI) in the court cases filed against Saudi
Aramco, and to secure access for their counsel to the
interagency committee handling the lawsuits issue. He
stated MinPet counsel may move to combine the class action
suits pending against Saudi Aramco. He noted a September
Ministry of Petroleum presentation to the Majlis al Shoura
and the November OPEC Summit in Riyadh would offer critics
of the USG ample scope to air their views. Of the OPEC
Summit, he quipped, "It will be one hell of a platform
for Khadafi and Chavez," and admitted somewhat ruefully
that even Saudi Arabia would be hard pressed to keep
NOPEC and the lawsuits from being prominently and
negatively mentioned in the OPEC Summit Declaration.

-------------- --------------
Prince Recalls When Oil Relationship Was Easier:
"I Remember When We Used to be Like One Government"
-------------- --------------


3. (SBU) In a July 16 meeting with Ambassador Fraker, Pol
Counselor, and Energy Attache, Prince Abdulaziz opened the
meeting by remarking that he will have handled the U.S.
account in MinPet for twenty years in January. He remarked
on the inauguration of the bilateral committee handling
U.S.-Saudi energy negotiations during that time. He
reminisced about the first Gulf War and the Iraqi

occupation of Kuwait, when "we were almost like one
government, with joint planning, trying to ensure
enough oil for the troops activities. Our policy was open
books. I belong to that sweet jolly good time."
Remarking on the changes in the political atmosphere,
the Prince noted, "Now there are questions marks on
the intentions of the U.S. Congress and public. The
U.S. is a huge market. We've always invested a lot
for it. We're realistic and sympathetic (to the
President). We differentiate between the President's
intentions and how things are faring right now in
the U.S."

-------------- --------------
SOI Request: We Need to Tranquilize People's Anxiety
Timeframe is Urgent
-------------- --------------


4. (C) Prince Abdulaziz spoke about the anxiety created by
NOPEC and the lawsuits against Saudi Arabia. He reiterated
his request for the Administration to file SOIs in the
district court cases filed against Saudi Aramco, stating, "We
need a fig leaf to tranquilize everyone here, because they
believe we can't accept this NOPEC thing. There is nothing
more the USG can do to put people's minds at ease than to
file the SOI, to tranquilize these cases." Ambassador Fraker
indicated that "We're closely examining the legal issues,
there is a process to follow, and every case is a little
different." He explained that the request was receiving
serious consideration, and would be discussed during his
upcoming meetings in Washington.


RIYADH 00001519 002.2 OF 004



5. (C) Prince Abdulaziz told us Minister Naimi had met
Secretary of Energy Bodman last week, and they had discussed

SIPDIS
the international energy markets, NOPEC, and the lawsuits.
The Prince re-emphasized how much he appreciated the good
work of A/S Karen Harbert, Molly Williamson, and others on
the Secretary Bodman's staff. However, he added on the NOPEC
issue, "These things go beyond Secretary Bodman, there is a
political angle, a situation between the Administration and
Congress." The Ambassador agreed, noting he hoped to spend
time on Capitol Hill speaking with Congress and to make them
aware of them aware of the likely repercussions of NOPEC.
Prince Abdulaziz then returned to the lawsuits issue,
"However, we urgently need movement on the cases, the cases
are more imminent than NOPEC, which is why we brought them up
in Tabouk (Note: During the Vice President Cheney's May 2007
visit, ref A, End note.) We don't want to dilute the
(lawsuits) issue, it's a question of timeframe."

--------------
Interagency Meeting Request
--------------


6. (C) Continuing on the theme of the Saudi Aramco
lawsuits, Prince Abdulaziz complained that "we're locked out
of the inter-agency process," claiming again that MinPet
counsel has been denied access to the interagency committee
handling the suits.

Action Request: According to Washington interlocutors, Prince
Abdulaziz's belief that Min Pet counsel has been "locked out"
of the interagency committee is more perception than reality.
However, to avoid any negative perceptions in this area,
Embassy Riyadh requests the interagency committee offer
MinPet counsel White and Case a meeting time with those
agencies able to accept meetings with outside counsel.

Prince Abdulaziz also requested that Ambassador Fraker meet
with Saudi Ambassador to the U.S. Jubeir on the lawsuits
issue while in Washington, and generally requested we keep
Ambassador Jubeir updated on this issue, as the Ambassador
will brief King Abdullah and Foreign Minister Prince Saud
Al-Faisal.

--------------
Legal Strategy: Combine Class Action Cases,
Keep OPEC at Bay, Lay Low on NOPEC
--------------


7. (C) Prince Abdulaziz then provided some insight into
MinPet's approach to the legal cases and NOPEC. He told us
MinPet counsel had recommended they seek to combine the
various class action suits against Saudi Aramco into one. He
mused, "Putting the cases into one court, not a bad idea.
They are in the final analysis the same, the approach and the
ramifications are the same." Prince Abdulaziz marveled that
counsel from opposing sides would attempt to negotiate such a
deal in the interests of efficiency; it seemed to strike him
as very American. Prince Abdulaziz confirmed MinPet's
traditional choice of counsel for the lawsuits filed against
Saudi Aramco, saying "On the individual cases, we're using
White and Case." However, unspecified lawyers would handle
the cases filed against Citgo, PDV, and Lukoil, as the KSA is
only an "un-named co-conspirator" in these cases. The Prince
explained, "We're working with the Venezuelans on a case,
we're talking to the Russians about one, and working with a
variety of lawyers on these cases. We're taking a lead, but
the Mexican and the Venezuelan legal counsel won't sit
together, it's agony to get them to agree to anything. We
have no love for the Venezuelans, but we're concerned we'll
establish a precedent (with respect to violating national
sovereignty.) With respect to the involvement of OPEC as an
organization, the Prince clarified, "We keep OPEC as an
organization at bay. There are amicus briefs from OPEC
members states though." Prince Abdulaziz also confirmed
MinPet was using White and Case to track their interests in
the NOPEC legislation. "On the NOPEC issue, we are following
it, but we are not lobbying. Based on our discussions with

RIYADH 00001519 003.2 OF 004


DOE, we are laying low."

-------------- --------------
Shoura Council Session, OPEC Summit Offer Enticing
Platforms to Air Anti-US Views on Lawsuit, NOPEC Issues
-------------- --------------


8. (C) Prince Abdulaziz warned of two potholes in the road
ahead in coming months: a summons for the Ministry of
Petroleum to make a presentation at the Majlis al Shoura
(MAS, the consultative counsel) by September, and the
November OPEC Summit to be held in Riyadh. He seems concerned
the USG must position itself to proactively manage
these events, or risk negative press in Saudi Arabia in the
first instance, or internationally in the second.


9. (C) Majlis al Shoura meeting: As per ref A, Prince
Abdulaziz reiterated he had recently appeared in a closed
meeting of the MAS to discuss NOPEC legislation, and had
managed to convince members that the "the best thing to do
was to remain quiet." He then added that the MinPet had
received a summons to appear before the MAS again on
budgetary issues by September, and he expects this session
will be public. He expects NOPEC to be an issue again, and
he also fears MAS members could find out about the lawsuits
against Saudi Aramco, which are not yet public knowledge in
Saudi Arabia. He told us that in the session two weeks ago,
he "did not mention the cases, it would have made the
situation worse. People would interlink the lack of a
delivery of a SOI with NOPEC."


10. (C) Prince Abdulaziz hopes to go into the September
publicly-televised session of the MAS armed with a SOI,
especially if the lawsuits are common public knowledge by
then. "If there is a larger MAS session, and the media comes
and there are cameras, we hope to have in-hand by then not
only a note threatening a veto for NOPEC, but also a SOI
interjecting into the court cases. We are mindful of the
legalities, but we'd like a fair chance of demonstrating to
our politicians that the Administration views this seriously."


11. (C) Moving onto the next likely pothole, Prince
Abdulaziz warned the November OPEC Summit in Riyadh would
offer an enticing platform for the critics of the USG to air
their views on NOPEC and the lawsuits, which have also
prominently targeted Venezuelan national oil company
Petroleos de Venezuela (PDV) and its affiliates such as
Citgo. He quipped, "It will be one hell of a platform for
Khadafi and Chavez." Commenting on the difficulty of keeping
harsh mentions of NOPEC out of the OPEC Summit Declaration,
Prince Abdulaziz laid out the timeline and process. "By 12
September, we hope to have an early draft of the Summit
Declaration. It will be a fancy soft draft, which will be
trashed by their (e.g., the Venezuelans and Libyans) gurus
during the negotiations. We will do our best, but how will
we overlook NOPEC?" Finally, as we wrapped up the
conversation, Prince Abdulaziz added a final plea on the
lawsuits issue, "I have spent a great deal of time over the
last 4-5 months on this issue, it is very crucial for us."

--------------
Comment
--------------


12. (C) Prince Abdulaziz appeared less agitated on the
lawsuit issue than at our last meeting (ref A),perhaps now
content he has obtained some measure of USG attention for his
cause. However, he has laid down some interesting markers
for the near future. By bringing up the MAS and OPEC Summit
meetings now, as a friend, he has warned us of potholes in
the road ahead. As an interlocutor seeking to shape our
behavior, he both upped the ante and reminded us that the SAG
will have significant opportunities in coming months to
determine how to spin NOPEC and the lawsuit issues amongst
the wider Saudi press and public. The SAG has thus far
chosen to keep these issues quiet and amongst the ruling
elite. A wider debate on either the NOPEC legislation or the

RIYADH 00001519 004.2 OF 004


lawsuits against Saudi Aramco would likely be subject to
significant mis-understanding by much of the public, and a
possible generalized backlash against the U.S.

FRAKER