BULGARIA: INPUT FOR NEW REQUIRED REPORT TO

UNCLAS SOFIA 000101 SIPDIS SIPDIS EEB/ESC/IEC FOR B. GLENN GRIFFIN, EUR/ERA, EUR/NCE, EUR/SCA E.O. 12958: N/A TAGS: ENRG SENV APER ABUD SUBJECT: BULGARIA: INPUT FOR NEW REQUIRED REPORT TO CONGRESS ON ENERGY REF: SECSTATE 10743 ¶1. (U) The following is Embassy Sofia's response to reftel, which requests input for two new reports to Congress on energy. BACKGROUND: BULGARIA: INCREASINGLY AT THE CENTER OF ENERGY SECURITY ISSUES ¶2. (U) Bulgaria is increasingly on the front line of European energy security issues. A hydrocarbon-poor country, Bulgaria is turning into a major transit point for proposed oil and gas pipelines. On the gas side, Bulgaria is party to the Nabucco pipeline project, which will bring Azerbaijani gas to Europe. In January 2008, it signed an intergovernmental agreement with Russia to build the South Stream pipeline, designed to bring gas from Russia to Europe. On the oil side, Bulgaria is party to the Burgas-Alexandroupolis pipeline, a Bosphorus-bypass project that will bring Caspian and Russian oil from the Bulgarian port of Burgas to the Greek port of Alexandroupolis. Bulgaria will also host the proposed AMBO pipeline, which seeks to bring Caspian and Russian oil from Burgas, across Macedonia, to the Albanian port of Vlore. Over ninety percent dependent on Russian gas itself, Bulgaria is balancing the need to keep Russian gas flowing while looking for ways to diversify its energy sources. The answers include the Nabucco gas pipeline; a potential LNG terminal; the planned, Russian-designed, nuclear power plant at Belene; increased use of renewable energy; and savings associated with greater energy efficiency. In February 2008, the World Energy Council named Bulgaria the most energy inefficient country in the European Union. ¶3. (U) Bulgaria's strategic location, increasing importance as a pipeline transit country, and extremely cost-competitive operating environment, make Embassy Sofia an ideal platform from which to launch any new USG initiatives on energy security in Europe. With ample space in its new, state-of-the-art embassy, Mission Sofia could host an EU-energy security-focused Energy attache from the Department of Energy, a regional energy officer from the State Department, additional State Department Public Diplomacy staff which could manage regional, energy-focused PD programs, and other energy security-focused federal employees who could provide regionally-focused research, training programs, U.S. business advocacy, and technical assistance on energy. Bringing together such a group of energy-security focused USG officials at "Energy Center Sofia" would help the USG answer the new strategic imperative posed by the emerging dominance of particular energy suppliers. EMBASSY ACTIVITIES ¶4. (U) In addition to providing extensive reporting on the pipeline projects that are proposed to transit Bulgaria and these project's potential effect on European energy security, in 2007 the Embassy: -- Led and hosted, in December 2007, the USG Energy Reporting Officers conference. This two-day event brought together more than 40 officers from 30 different posts and U.S. Government agencies to discuss pipeline projects and energy security. -- Supported, in connection with the above-mentioned Energy Conference, the visits of the EUR DAS for Energy Issues and EEB Energy Coordinator. -- Urged, through intense high-level engagement, the Government of Bulgaria to protect its interests when negotiating pipeline deals. -- Supported the planning of a local NGO's conference on energy security in Europe. -- Briefed U.S. firms interested in entering Bulgaria's energy sector. -- Advocated for a major U.S. renewable energy company when it encountered bureaucratic obstacles related to a major project in Bulgaria. -- Instituted an Embassy working group focused on energy and investment issues. ¶5. (U) A. Within Embassy Sofia, the Political/Economic section takes the lead on gas and oil issues. The Executive Office is heavily engaged in Energy as well. Department of Commerce and USAID staff who worked on energy issues in 2007 are not covered in this cable. ¶B. Positions of State Department employees that work on energy matters and the percentage of time they devote to energy: -- Ambassador: 15 percent of time -- Deputy Chief of Mission: 5 percent of time -- Pol/Econ Counselor: 5 percent of time -- Economic Officer: 60 percent of time -- Pol/Econ OMS: 5 percent of time -- Pol/Econ FSN: 30 percent of time ¶C. Description of the positions of employees and the kinds of work they do: -- Ambassador: Engages highest level host government officials on energy and energy security issues; advocates U.S. policy on energy; engages the media on U.S. energy policy and energy security issues; maintains contacts with U.S. energy companies. -- Deputy Chief Of Mission: Engages host government officials and business representatives on energy and energy security issues. -- Pol/Econ Counselor: Supervises the work of the Economic Officer handling the energy portfolio. -- Economic Officer: Advocates U.S. policy on energy and energy security issues; reports on developments in the energy sector; reports on energy-related meetings; engages host government officials on energy and energy security issues; extends and deepens contacts with U.S. and local energy companies; supports energy-related visits; coordinates work of the Embassy working group on energy issues. -- Pol/Econ OMS: Supports energy-related work of Pol/Econ Chief and Economic Officer. -- Econ/FSN: Researches and reports on developments in the energy sector; expands contacts with energy sector officials and companies; supports energy-related visits. ¶D. Budget: Base Salary Costs: 106,044 Programs: None in 2007. ¶6. (U) Comment: Energy security is increasingly a strategic imperative for the United States. If the USG plans to allocate additional resources to deal with this issue in Europe, Embassy Sofia should be considered as a location from which to run regionally-focused programs of all types - analytical research, public diplomacy, training, export promotion. For additional information on the "Sofia Energy Center" concept, please contact Economic Officer Kelly Adams-Smith at adamssmithke@state.gov. Beyrle