TURKMENISTAN: BERDIMUHAMEDOV DAZED AND CONFUSED

S E C R E T SECTION 01 OF 02 ASHGABAT 000677 SIPDIS STATE FOR SCA/CEN, EEB, E U/S JEFFERY PLEASE PASS TO USTDA DAN STEIN USEU FOR AMBASSADOR GRAY ENERGY FOR EKIMOFF/THOMPSON COMMERCE FOR HUEPER E.O. 12958: DECL: 05/29/2028 TAGS: PGOV PREL EPET AJ TX SUBJECT: TURKMENISTAN: BERDIMUHAMEDOV DAZED AND CONFUSED BY AZERBAIJAN Classified By: CDA RICHARD E. HOAGLAND: 1.4 (B),(D) ¶1. (S) During the second half of their nearly two-hour meeting on May 28, President Gurbanguly Berdimuhamedov asked all the participants in his meeting to step out so that he could brief SCA Assistant Secretary Richard Boucher on his May 9-10 visit to Baku and his talks with President Ilham Aliyev. Only Deputy Prime Minister/Foreign Minister Rashid Meredov stayed in the president's office as translator. BEGIN TEXT OF READOUT FROM A/S BOUCHER: ¶2. (S) Berdimuhamedov said he wanted to explain the story of his visit to Baku, since we had discussed our mutual interest in the Caspian from our first meeting in February 2007. He relayed how in meetings with Coordinator for Eurasian Energy Diplomacy Ambassador Steven Mann they had tried to find non-political ways of proceeding in the Caspian. In Tehran, at the five-state summit last year, Berdimuhamedov had said that "if any two countries agree on a project, they can proceed." Then-Russian President Vladimir Putin objected and said that projects across the Caspian would "violate the ecology" of the region. President Bush had said all the right words when he and Berdimuhamedov met in April at the NATO Summit in Bucharest: "You are an independent nation and need to make decisions that are right for you." ¶3. (S) For the past three months, the small Canadian company, Buried Hill, has been working in the disputed Serdar/Kyapaz Caspian block that Turkmenistan claims, and has reportedly identified deposits of 82 million tons of oil and 32 billion cubic meters of gas. Just before Berdimuhamedov,s visit to Baku, he said, Russian Deputy Foreign Minister Karasin and Defense representatives in the Duma had visited Azerbaijan. Then, as he was heading to Baku, Azerbaijani border patrol craft showed up near the Serdar/Kyapaz block. Berdimuhamedov showed me pictures of small naval craft marked S-003, S-004, S-005 and S-007 around the "Buried Hill" platform. ¶4. (S) Berdimuhamedov described his Baku meetings with Aliyev as good. Then in the one-on-one with Aliyev, he said, "Let,s turn a new page." He proposed that their experts get together and work out a compromise demarcation line in the Caspian. If the two of them could agree, others would have to support their agreement. The disputed areas from west to east are Osman-Omar/Azeri-Chirag-Guneshli (ACG) and Serdar/Kyapaz. (NOTE: These are major deposits along the geological structure that stretches across the Caspian from Baku to Turkmengashy. Here we give the Turkmen names first, followed by the Azeri names for the same deposits. END NOTE.) The Turkmen claim goes west to Osman-Omar/ACG; the Azeri claim goes east to Serdar/Kyapaz. Berdimuhamedov said he proposed that they take the middle line: Osman-Omar/ACG on the Azeri side; Serdar/Kyapaz on the Turkmen side. Furthermore, pipelines would bring the production from Serdar/Kyapaz straight across to Baku. Surprisingly, according to Berdimuhamedov, Aliyev showed no interest. Berdimuhamedov said he thinks "Aliyev is a good man" and can,t decide why he didn,t respond to the offer. ¶5. (S) We talked a bit about broader delimitation. I told Berdimuhamedov I,d been surprised when Kazakhstan's President Nazarbayev told me a few months ago there could be a five-party delimitation agreement this year. Berdimuhamedov agreed that was not going to happen: "You know Nazarbayev, he likes to talk about big things." In any case, two was enough for a deal. ASHGABAT 00000677 002 OF 002 ¶6. (S) I made clear to Berdimuhamedov that we supported efforts to develop Caspian routes, because having multiple routes would mean Turkmenistan would get a world price for its gas from all customers. Second, it was strategically important to develop ties to the West. We would support him. We agreed that any two states can conclude agreements, and that ecological arguments were unscientific and unfounded, coming from countries with thousands of kilometers of pipelines in the Caspian already. We had agreed to work, and would continue to work, on practical steps to keep moving forward toward the goal of trans-Caspian gas. I noted that after my visit to Baku, Ambassadors C. Boyden Gray and Steven Mann would visit Baku and then come to Ashgabat. ¶7. (S) Berdimuhamedov thanked me. He said he had proposed to Aliyev to have their border guards meet to discuss the ships. Aliyev hadn,t responded. Meredov had asked his counterpart about the ships, who didn,t seem to know anything. They feel they didn,t get a straight answer as to why the ships showed up right before his visit. ¶8. (C) I,ll continue to pursue these issues in Baku. I still see our role as being practical and constructive. We,ll see what we get. END TEXT. HOAGLAND