SCENESETTER FOR SECRETARY BODMAN'S JANUARY 21-22

S E C R E T SECTION 01 OF 04 DOHA 000024

SIPDIS

SIPDIS

DOE FOR KATHRYN COLAHAN

E.O. 12958: DECL: 01/08/2018
TAGS: ENRG PREL QA
SUBJECT: SCENESETTER FOR SECRETARY BODMAN'S JANUARY 21-22
VISIT TO QATAR

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Classified By: Charge d'Affaires Michael A. Ratney,
for reasons 1.4 (b) and (d).


1. (C) Embassy Doha welcomes your January 21-22 visit to
Qatar. You last met with Deputy Prime Minister/Minister of
Energy and Industry Abdullah Al-Attiyah in Rome in November

2007. Prior to that, he visited you in Washington in May
2007, and you saw him in Doha in April 2006 and November

2005. Although not a member of the ruling Al Thani family,
he is capable, influential, and extremely close to the Amir.
Al-Attiyah led the development of his country's energy sector
and is the ultimate authority on energy contracts and oil and
gas development in Qatar.

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A STRATEGIC PARTNER IN ENERGY...
--------------


2. (C) Qatar is exceptionally friendly to U.S. energy
companies and appreciates the competence and expertise they
bring to the country's economic development. Since 1999,
there has been USD 60 billion in foreign investment in
Qatar's energy sector with the majority, about USD 40
billion, coming from U.S. firms, including ExxonMobil,
ConocoPhillips, Anadarko, and Occidental. From an energy
security perspective, Qatar is enormously important to the
U.S. Soon, nearly 20 percent of ExxonMobil's global revenue
will derive from Qatar. This small emirate will next year
become a major supplier of LNG to the U.S. following the
recent CFIUS approval of $2.2 billion development by Qatar
Petroleum, ExxonMobil and ConocoPhillips of the Golden Pass
LNG terminal in southeast Texas. Eventually Qatar will
become the U.S.' largest source of imported LNG.


3. (U) Qatar is already the world's largest exporter of LNG
and at over USD 60,000, Qatar's per capita income is now
ranked in the top five in the world, alongside Luxembourg and
Liechtenstein. The country has plans to invest an additional
USD 70 billion in its natural gas sector and expand
production through 2012, when a self-imposed moratorium on
North Field development begins. But by then, LNG exports
will more than double. Despite the focus on LNG, oil still
accounts for nearly half of Qatar's energy earnings. The GOQ
estimates Qatar's oil reserves at 27 billion barrels. Daily
average production is currently estimated to be 806,000
barrels per day; at current production rates, oil reserves
are expected to last 20 to 60 years. Moreover, the
introduction of new technologies by U.S. and other companies
is extending the life of existing fields.

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... AND A VITAL MILITARY RELATIONSHIP
--------------


4. (S) Beyond the energy relationship, the U.S. has a lot at
stake in Qatar. Al-Udeid Air Base and other U.S. military
facilities are critical to CENTCOM operations from Iraq to
Afghanistan to the Horn of Africa. Qatar hosts approximately
9,000 U.S. forces, some 100 U.S. and Coalition aircraft, as
well as the CENTCOM ForwQd Headquarters, the Combined Air
Operations Center, SOCCENT Forward Qadquarters, and other
important DOD facilities. Qatar isQunding hundreds of
millions of dollars in construction for the U.S. at Al-Udeid
Air Base. Our hosts had no objection to stationing B1
bombers here, regularly send military personnel to the U.S.
for training, and after years of sourcing their military
hardware in Europe, are showing increasing interest in buying
American, with a major sale of C-17 aircraft first on the
list.

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COMMITMENT TO EDUCATIONAL REFORM, RULE OF LAW
--------------


5. (C) Beyond strong military and energy relationships, there
is a lot going right in Qatar from the U.S. perspective.
Qatar's commitment to modernize its educational system is
exemplified by Education City, a 2500-acre campus on the
outskirts of Doha. Managed by the Qatar Foundation, the
umbrella organization chaired by the Amir's wife, Sheikha
Mozah, Education City is home to five U.S. college branch
campuses (Texas A&M, Carnegie Mellon, Weill-Cornell Medical
School, Georgetown School of Foreign Service, and Virginia
Commonwealth University),with some 800 students currently

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enrolled. Northwestern University in late 2007 announced its
intention to establish a school or journalism. Meanwhile,
primary and secondary school curriculum is being reformed
along U.S. standards and a network of competitive charter
schools is gradually replacing out-moded government-run
schools. And rule of law, if not full democratization, is
taking root firmly, though slowly.

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TROUBLESOME POLITICAL RELATIONSHIP
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6. (S) Although our relationship with Qatar remains solid in
the energy, military and educational fields, politically it
has soured steadily since the beginning of Operation Iraqi
Freedom. This trend began with Al Jazeera's harshly biased
coverage of OIF in 2003, but it has been Qatar's foreign
policy initiatives - and its maddening behavior on the UN
Security Council for the past two years - that really drove
the deterioration. In addition, our bilateral
counter-terrorism and intelligence cooperation - of obvious
critical importance in this region - is now the worst of all
GCC states. Meanwhile, the senior Qatari leadership appears
to have grown jealous of our relationships with regional
rivals and annoyed that we don't give Qatar more attention,
including senior-level visits and visibility in our own
regional initiatives. The Amir was unavailable to meet with
Secretary Rice during the UN General Assembly last fall but

SIPDIS
did manage to meet with the Iranian President. Later in the
year, HBJ chose not to attend the Annapolis Conference.


7. (S) Mere mention of Qatar to our regional allies raises
their ire, even though we have seen no smoking gun for most
of their accusations. Our own list of grievances with Qatar
is long enough, but at the core are its high-level engagement
with Hamas leaders even as we seek to isolate them; support
for Syria and its allies in Lebanon as we work to support the
democratic majority; serving as a flak for Sudan and
Hezbollah during its just-ended stint on the UN Security
Council; and a failure to follow through on its stated
commitment to forgive Iraqi debt.


8. (S) Iran also hangs heavily over the relationship; Qatar
believes we may have plans for Iran, perhaps even military
plans that we are not sharing with them. During its 2006-07
tenure on the UN Security Council, Qatar cast the
consensus-breaking (14-1) vote on Resolution 1696 in July

2006. (Qatar later joined consensus in two unanimous votes,
UNSCR 1736 and UNSCR 1747, to impose sanctions on Iran's
nuclear program.) Qatar does share our concern about Iran's
nuclear program and revolutionary ideology, but Qatar's
geographic proximity, vulnerability of its energy
installations, and the fact that its massive off-shore gas
reserves are shared with Iran, dictate a less confrontational
approach.


9. (C) We nevertheless believe the Qatari leadership regards
our relationship as strategic and permanent, and they see the
military bases, energy contracts, and U.S. universities as
evidence of this. But at this point, the Amir and his Prime
Minister/Foreign Minister Hamad Bin Jassim Bin Jabor Al Thani
(HBJ) are likely waiting out the Administration hoping that
bilateral relations improve in 2009.

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MAIN THEMES OF YOUR VISIT
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10. (S) Visits like yours help enormously to sustain the
positive aspects of our bilateral relationship. Qatar has
always responded well to high-level contact; likewise,
isolating Qatar has only had a negative effect on its
behavior. From Embassy Doha's perspective, we recommend you
pursue the following objectives:

-- (C) Reaffirm the high value we place on our bilateral
energy relationship, both as a partner for U.S. investment
and a future source of LNG. Reassert that although the CFIUS
review may have been a painful process for Qatar Petroleum,
the U.S. is absolutely committed to being a friendly
destination for Qatari investment.

-- (S) Urge Qatar to take bold action to address shortcomings
in the security of its critical energy infrastructure. The

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GOQ has shied away from cooperating with the U.S. in the
context of Critical Energy Infrastructure Protection (CEIP).
An interagency team visited Qatar last year to begin initial
CEIP discussion. In September, we were told that the GOQ was
waiting for the conclusions of a private sector study (which
we know unofficially to be from Giuliani Safety and Security)
before engaging us on these issues. The Giuliani study was
completed months ago. However, the GOQ has yet to express an
interest in engaging with us. We recommend that you point
out to Al-Attiyah, as we have done elsewhere, that USG
resources can complement the work and recommendations of
private consultants.

-- (C) Solicit Al-Attiyah's views on development of renewable
energy. You will find that Qatar is a willing partner and
advocate for renewable energy strategies and promoting
advanced technologies in the hydro-carbon sector, and
Al-Attiyah will welcome your views on how the U.S. proposes
to move forward in reducing dependency on oil and gas and
addressing economic development/climate change concerns.

-- (S) Probe the U.S. representatives for Qatar's thinking on
exploiting further the North Field. The breakfast with
representatives of the major U.S. energy companies January 22
will guide your discussions with Al-Attiyah later that
morning on what role U.S. companies can play in expanding
investment and cooperation. We would like a sense from
Al-Attiyah of GOQ views on extracting more natural gas from
this area beyond the 2012 moratorium and on the nature of
their coordination with Iran - if any - on this sensitive
subject.

-- (C) Encourage Al-Attiyah (and Minister of Finance Kamal,
should you have the opportunity) to refrain from unhelpful
public statements about depegging the dollar and OPEC
pricing. GOQ officials assure us privately that they share
our views but often strike a more dissonant note in public.

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ADDITIONAL BACKGROUND
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11. (C) For additional background, following are details on
other key issues in Qatar and aspects of our bilateral
relationship.


12. (SBU) TRAFFICKING IN PERSONS: The dark underbelly of
Qatar's spectacular energy-driven growth is the abysmal
working conditions of the thousands of Asian and South Asian
workers brought here to build the country's roads and modern
high-rises and provide the services and manual labor that
Qataris never will. Along with most of its Gulf neighbors,
Qatar was downgraded last year to Tier 3 in the annual
Trafficking in Persons report. While there is growing
sensitivity to the issue at senior levels, many influential
Qataris -- led by the prosperous but competition-free
business community -- strenuously resist anything that smacks
of liberalizing labor and immigration laws, fearing an
erosion of their privileged position in a country where they
constitute at best one fifth of the population.


13. (C) IRAQ: The Amir shares our view that restoration of
order and a successful democratic transition are of paramount
importance not only to Iraq but to the region. However, a
feeling that Qatar has been excluded from regional
Iraq-related diplomacy, along with a strong distaste for
Iraq's Shia-dominated government, drives Qatar's resistance
to follow through on some of our priorities, including
comprehensive debt forgiveness. While HBJ has expressed
concerns about civil war in Iraq, he has also stated publicly
that the coalition needs to stay in the country to establish
wider security. The GOQ is neither prepared to open an
embassy in Baghdad nor send a high-level delegation there
until the security situation improves dramatically.


14. (C) AL JAZEERA: Al Jazeera is by far the region's most
prominent media outlet and the bane of many governments in
the region, though no longer the irksome centerpiece of
U.S.-Qatari relations. The network is more than ten years
old with an Arabic-speaking audience of some 50 million
viewers. In November 2006, it launched an English-language
channel with a potential audience of 70 million and ambitions
to compete with the major U.S. and British satellite networks
worldwide. Since early last year, the USG has seen a bumpy

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downward trend in inflammatory anti-Western bias and
inaccuracy in Al Jazeera's content. Al Jazeera has increased
its use of USG sources, limited its use of inflammatory
terminology, and devoted more time to stories of interest in
the region other than the U.S. role in Iraq. Al Jazeera's
track record remains far from perfect. Unprofessional,
biased, and inaccurate reporting continues to appear on its
newscasts, talk shows, and website. The USG has long
objected to Al Jazeera's practice of airing
terrorist-provided video tapes, though the terrorists
increasingly prefer to use the Internet to release these
videos unedited.


15. (S) TERRORIST FINANCING: Qatar is often accused (by
Jordan, the Palestinian Authority, and others) of funneling
money to Hamas, though we have never seen clear evidence that
this is actually happening. The Qataris have been largely
cooperative on counter-terrorist finance issues, apparently
anxious to avoid letting their small but growing financial
sector be exploited by terrorists. The Qatar Authority for
Charitable Works monitors all domestic and international
charitable activities and approves international fund
transfers by the charities. Qatar has a Financial
Information Unit that resides in the Qatar Central Bank and
can review suspect accounts. Local banks work with the
Central Bank and the FIU on CT finance and anti-money
laundering issues, and bank officials attend U.S.-sponsored
conferences on these subjects.


16. (U) POLITICAL REFORM: Qatar's own program of reform,
launched by the Amir after he assumed power in 1995, could
take a significant step forward when the government
eventually holds first-time elections for its national
legislature. Qatar has gone slow, seeking to establish an
institution that reflects local social and political norms.
The current sticking points are who will be able to vote
(likely a fraction of Qatar's 186,000 citizens) and who may
stand for office. HBJ has said he "hopes" that parliamentary
elections will be held in 2008. Qatar's continual delay in
announcing these elections may be the result of seeing how an
elected parliament in Kuwait, strongly populated by
Islamists, has worked against reforms initiated by the ruler.
Qatari women have had the right to vote since the first
election took place in the country in 1999, for the Central
Municipal Council. Elections for the country's third
municipal council took place April 2007, and a woman was
elected with the highest number of votes in any district.

RATNEY