Identifier
Created
Classification
Origin
08ASHGABAT849
2008-07-08 06:45:00
CONFIDENTIAL
Embassy Ashgabat
Cable title:
TURKMENISTAN: CHALIK ENERJI DELINQUENT ON
how-toVZCZCXRO1547 PP RUEHAG RUEHBI RUEHCI RUEHLH RUEHPW RUEHROV DE RUEHAH #0849 1900645 ZNY CCCCC ZZH P 080645Z JUL 08 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC PRIORITY 1103 INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY RUCNCIS/CIS COLLECTIVE PRIORITY RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEHAD/AMEMBASSY ABU DHABI PRIORITY 0387 RUEHAK/AMEMBASSY ANKARA PRIORITY 3980 RUEHBJ/AMEMBASSY BEIJING PRIORITY 1797 RUEHKL/AMEMBASSY KUALA LUMPUR PRIORITY 0182 RUEHKO/AMEMBASSY TOKYO PRIORITY 1664 RUEHIT/AMCONSUL ISTANBUL PRIORITY 2233 RHMFISS/CDR USCENTCOM MACDILL AFB FL PRIORITY RUEAIIA/CIA WASHDC PRIORITY RHEFDIA/DIA WASHDC PRIORITY RUEKJCS/JOINT STAFF WASHDC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RUEKJCS/SECDEF WASHDC PRIORITY RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY RHEBAAA/DEPT OF ENERGY WASHDC PRIORITY
C O N F I D E N T I A L ASHGABAT 000849
SIPDIS
STATE FOR SCA/CEN, EEB
PLEASE PASS TO USTDA DAN STEIN
ENERGY FOR EKIMOFF/THOMPSON
COMMERCE FOR HUEPER
E.O. 12958: DECL: 07/08/2018
TAGS: PREL EPET ECON TU TX
SUBJECT: TURKMENISTAN: CHALIK ENERJI DELINQUENT ON
PAYMENT TO U.S. COMPANY WORKING GAS FIELD BLOWOUT
Classified By: CDA RICHARD E. HOAGLAND: 1.4(b),(d)
C O N F I D E N T I A L ASHGABAT 000849
SIPDIS
STATE FOR SCA/CEN, EEB
PLEASE PASS TO USTDA DAN STEIN
ENERGY FOR EKIMOFF/THOMPSON
COMMERCE FOR HUEPER
E.O. 12958: DECL: 07/08/2018
TAGS: PREL EPET ECON TU TX
SUBJECT: TURKMENISTAN: CHALIK ENERJI DELINQUENT ON
PAYMENT TO U.S. COMPANY WORKING GAS FIELD BLOWOUT
Classified By: CDA RICHARD E. HOAGLAND: 1.4(b),(d)
1. (C) Almost 18 months ago, Turkmenistan had a major
blowout in its South Yoloten gas field in an exploratory
drilling operation operated by Turkish company Chalik Enerji.
After weeks of trying to handle the blowout, Chalik Enerji
signed a contract on an emergency basis with U.S. company
Cudd Energy Services. Cudd flew in emergency equipment and
personnel from its regional office in Dubai and was able to
put out the blowout. However, Chalik has yet to pay Cdd for
its services, which total almost $1.8 million.
2. (C) Cudd's Amcit Vice President for International
Development in the Middle East told EmbOff July 3 Chalik
Enerji's General Manager for Turkmenistan, Hasan Toparlak,
says his company is withholding payment because state firm
Turkmen Geology, which initially contracted with Chalik
Enerji to work the exploratory well, has yet to pay Chalik
Enerji. Although Cudd's contract was with Chalik Enerji,
Toparlak wants Cudd to accept two invoices -- one for
$500,000 from Chalik Enerji and a separate one for $1.3
million from Turkmen Geology. Cudd has told Chalik that it
is willing to accept such an arrangement, as long as it gets
paid. Cudd is also consulting attorneys about filing a
lawsuit against Chalik Enerji, either in Turkmenistan or
Turkey.
3. (C) COMMENT: The Government of Turkmenistan has recently
frozen out both Chalik Enerji and its sister affiliate,
construction company Gap Inshaat, from being awarded
contracts. Chalik Enerji is still building a gas processing
facility north of Turkmenbashy for Malaysian oil company
Petronas, and has completed a Dashoguz power station that it
was contracted to build under former President Niyazov. Gap
Inshaat's last major construction project (other than the
U.S.-funded Farap border crossing station) is a grand mosque
in Dashoguz Province. The Turkmen government's two most
recent contracts for power stations -- in Ahal Province and
at the Avaza tourist zone -- have been awarded to Lotys
Enerji, founded by a former Chalik Enerji employee, leaving
once-powerful Chalik Enerji out in the cold -- and probably
strapped for cash. All this goes to show how quickly
political (and economic) fortunes can rise and fall: Ahmed
Chalik, who had a strong personal relationship with the
President Niyazov, served as deputy minister for textiles and
received most of the construction contracts not awarded to
French company Bouygues. But for a combination of reasons
both petty and personal, Chalik offended President
Berdimuhamedov. Although Chalik reportedly made a bid to
mend fences by offering to build the mosque in Dashoguz at
cost, it appears that Berdimuhamedov's favor, once lost, is
not so easily regained. This is cold comfort for Cudd, which
still needs to recover payment from Chalik Enerji. In the
meantime, there is one silver lining: through its
willingness to spring to the rescue, Cudd has benefited by
being able to break into Turkmenistan's hydrocarbon service
market. END COMMENT.
HOAGLAND
SIPDIS
STATE FOR SCA/CEN, EEB
PLEASE PASS TO USTDA DAN STEIN
ENERGY FOR EKIMOFF/THOMPSON
COMMERCE FOR HUEPER
E.O. 12958: DECL: 07/08/2018
TAGS: PREL EPET ECON TU TX
SUBJECT: TURKMENISTAN: CHALIK ENERJI DELINQUENT ON
PAYMENT TO U.S. COMPANY WORKING GAS FIELD BLOWOUT
Classified By: CDA RICHARD E. HOAGLAND: 1.4(b),(d)
1. (C) Almost 18 months ago, Turkmenistan had a major
blowout in its South Yoloten gas field in an exploratory
drilling operation operated by Turkish company Chalik Enerji.
After weeks of trying to handle the blowout, Chalik Enerji
signed a contract on an emergency basis with U.S. company
Cudd Energy Services. Cudd flew in emergency equipment and
personnel from its regional office in Dubai and was able to
put out the blowout. However, Chalik has yet to pay Cdd for
its services, which total almost $1.8 million.
2. (C) Cudd's Amcit Vice President for International
Development in the Middle East told EmbOff July 3 Chalik
Enerji's General Manager for Turkmenistan, Hasan Toparlak,
says his company is withholding payment because state firm
Turkmen Geology, which initially contracted with Chalik
Enerji to work the exploratory well, has yet to pay Chalik
Enerji. Although Cudd's contract was with Chalik Enerji,
Toparlak wants Cudd to accept two invoices -- one for
$500,000 from Chalik Enerji and a separate one for $1.3
million from Turkmen Geology. Cudd has told Chalik that it
is willing to accept such an arrangement, as long as it gets
paid. Cudd is also consulting attorneys about filing a
lawsuit against Chalik Enerji, either in Turkmenistan or
Turkey.
3. (C) COMMENT: The Government of Turkmenistan has recently
frozen out both Chalik Enerji and its sister affiliate,
construction company Gap Inshaat, from being awarded
contracts. Chalik Enerji is still building a gas processing
facility north of Turkmenbashy for Malaysian oil company
Petronas, and has completed a Dashoguz power station that it
was contracted to build under former President Niyazov. Gap
Inshaat's last major construction project (other than the
U.S.-funded Farap border crossing station) is a grand mosque
in Dashoguz Province. The Turkmen government's two most
recent contracts for power stations -- in Ahal Province and
at the Avaza tourist zone -- have been awarded to Lotys
Enerji, founded by a former Chalik Enerji employee, leaving
once-powerful Chalik Enerji out in the cold -- and probably
strapped for cash. All this goes to show how quickly
political (and economic) fortunes can rise and fall: Ahmed
Chalik, who had a strong personal relationship with the
President Niyazov, served as deputy minister for textiles and
received most of the construction contracts not awarded to
French company Bouygues. But for a combination of reasons
both petty and personal, Chalik offended President
Berdimuhamedov. Although Chalik reportedly made a bid to
mend fences by offering to build the mosque in Dashoguz at
cost, it appears that Berdimuhamedov's favor, once lost, is
not so easily regained. This is cold comfort for Cudd, which
still needs to recover payment from Chalik Enerji. In the
meantime, there is one silver lining: through its
willingness to spring to the rescue, Cudd has benefited by
being able to break into Turkmenistan's hydrocarbon service
market. END COMMENT.
HOAGLAND