Identifier
Created
Classification
Origin
09ASHGABAT908
2009-07-20 10:34:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Ashgabat
Cable title:
GERMAN RWE SIGNS PSA WITH TURKMENISTAN
how-toVZCZCXRO1476 PP RUEHAG RUEHAST RUEHBI RUEHCI RUEHDBU RUEHDF RUEHIK RUEHLH RUEHLN RUEHLZ RUEHNEH RUEHPW RUEHROV RUEHSK RUEHSL RUEHSR RUEHVK RUEHYG DE RUEHAH #0908 2011034 ZNR UUUUU ZZH P 201034Z JUL 09 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC 3166 INFO RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE RUCNCIS/CIS COLLECTIVE RUCNMEM/EU MEMBER STATES COLLECTIVE RUEHAK/AMEMBASSY ANKARA 5451 RUEHBJ/AMEMBASSY BEIJING 3176 RUEHKO/AMEMBASSY TOKYO 3041 RUEHIT/AMCONSUL ISTANBUL 3695 RUCNDT/USMISSION USUN NEW YORK 1058 RHMCSUU/CDR USCENTCOM MACDILL AFB FL RUEHVEN/USMISSION USOSCE 3730 RUEAIIA/CIA WASHDC RHEFDIA/DIA WASHDC RHEHNSC/NSC WASHDC RUEKJCS/SECDEF WASHDC RUEKJCS/JOINT STAFF WASHDC
UNCLAS ASHGABAT 000908
SENSITIVE
SIPDIS
STATE FOR SCA/CEN; EEB
PLEASE PASS TO USTDA DAN STEIN
ENERGY FOR EKIMOFF/THOMPSON
COMMERCE FOR HUEPER
E.O. 12958: N/A
TAGS: EPET PGOV EINV TX IR
SUBJECT: GERMAN RWE SIGNS PSA WITH TURKMENISTAN
REF: A. Ashgabat 515
B. Ashgabat 869
UNCLAS ASHGABAT 000908
SENSITIVE
SIPDIS
STATE FOR SCA/CEN; EEB
PLEASE PASS TO USTDA DAN STEIN
ENERGY FOR EKIMOFF/THOMPSON
COMMERCE FOR HUEPER
E.O. 12958: N/A
TAGS: EPET PGOV EINV TX IR
SUBJECT: GERMAN RWE SIGNS PSA WITH TURKMENISTAN
REF: A. Ashgabat 515
B. Ashgabat 869
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) SUMMARY: On July 16, RWE AG, a German energy company (and
Nabucco pipeline project shareholder) and the Government of
Turkmenistan signed a production sharing agreement (PSA) for Block
23 of the contractual territory located with Turkmenistan's Caspian
Sea territorial waters. According to the agreement, RWE has
received a six-year license to conduct exploration on Block 23 and
will receive a 25-year license authorizing the company to
commercially develop hydrocarbons on Block 23 if sufficient reserves
are discovered during the exploration process. END SUMMARY.
3. (SBU) Block 23 is located in the southeastern part of
Turkmenistan's Caspian Sea territorial waters about 40 kilometers
north of Iran's land border and is adjacent to Turkmenistan's coast.
It is triangle-shaped, with an area of about 940 square kilometers.
According to official Turkmen sources, the Block has potential
reserves, primarily of natural gas. An international company
representative working in Turkmenistan told us that the Block is
believed to be prospective mostly for gas and mentioned that there
are doubts that discoveries of large hydrocarbon reserves will be
made there.
4. (SBU) The PSA is part of a larger Memorandum on Long-term
Cooperation (Memorandum) that RWE and the Government of Turkmenistan
signed on April 16 (Ref A). Yagshygeldi Kakayev, Director of the
State Agency for the Management and Use of Hydrocarbon Resources,
and RWE AG's Chairman Georg Schning, signed the PSA in President
Berdimuhamedov's presence in Turkmenbashy. Before the signing
ceremony, President Berdimuhamedov discussed the implementation of
the Memorandum's provisions in a meeting with J|rgen Grossman, RWE's
Chairman of the Board, and Rudi Lamprecht, Director and founder of
EWC East West Connect GmbH & Co. KG. The clear involvement of Mr.
Lamprecht, who also serves as Executive Advisor to the CEO of
Siemens AG and as Vice Chairman of the Board of Nokia Siemens
Networks, in RWE's deals with the Turkmen government, confirms our
assumption that RWE has been able to enter Turkmenistan's markets,
in part, due to the good relations that Siemens, and particularly
Mr. Lamprecht, has managed to build with high-ranking Turkmen
officials (Refs A and B).
5. (SBU) COMMENT: The signing of the PSA is RWE's first serious
step in implementing the Memorandum provisions. It took the company
exactly three months to move from the Memorandum to the PSA, rather
fast given conditions in Turkmenistan. The ceremony has not
divulged details of the most intriguing Memorandum provision, which
states that Turkmenistan and RWE will negotiate a long-term contract
for the sale and purchase of Turkmen natural gas. There is still no
information regarding the status of that contract. Block 23 itself
will not make RWE a key energy partner of the Government. The only
real indicator of RWE's importance to the Turkmen government will be
the progress the company is able to make in negotiating the
long-term contract for the sale and purchase of Turkmen natural gas.
END COMMENT
MILES
SENSITIVE
SIPDIS
STATE FOR SCA/CEN; EEB
PLEASE PASS TO USTDA DAN STEIN
ENERGY FOR EKIMOFF/THOMPSON
COMMERCE FOR HUEPER
E.O. 12958: N/A
TAGS: EPET PGOV EINV TX IR
SUBJECT: GERMAN RWE SIGNS PSA WITH TURKMENISTAN
REF: A. Ashgabat 515
B. Ashgabat 869
1. (U) Sensitive but unclassified. Not for public Internet.
2. (SBU) SUMMARY: On July 16, RWE AG, a German energy company (and
Nabucco pipeline project shareholder) and the Government of
Turkmenistan signed a production sharing agreement (PSA) for Block
23 of the contractual territory located with Turkmenistan's Caspian
Sea territorial waters. According to the agreement, RWE has
received a six-year license to conduct exploration on Block 23 and
will receive a 25-year license authorizing the company to
commercially develop hydrocarbons on Block 23 if sufficient reserves
are discovered during the exploration process. END SUMMARY.
3. (SBU) Block 23 is located in the southeastern part of
Turkmenistan's Caspian Sea territorial waters about 40 kilometers
north of Iran's land border and is adjacent to Turkmenistan's coast.
It is triangle-shaped, with an area of about 940 square kilometers.
According to official Turkmen sources, the Block has potential
reserves, primarily of natural gas. An international company
representative working in Turkmenistan told us that the Block is
believed to be prospective mostly for gas and mentioned that there
are doubts that discoveries of large hydrocarbon reserves will be
made there.
4. (SBU) The PSA is part of a larger Memorandum on Long-term
Cooperation (Memorandum) that RWE and the Government of Turkmenistan
signed on April 16 (Ref A). Yagshygeldi Kakayev, Director of the
State Agency for the Management and Use of Hydrocarbon Resources,
and RWE AG's Chairman Georg Schning, signed the PSA in President
Berdimuhamedov's presence in Turkmenbashy. Before the signing
ceremony, President Berdimuhamedov discussed the implementation of
the Memorandum's provisions in a meeting with J|rgen Grossman, RWE's
Chairman of the Board, and Rudi Lamprecht, Director and founder of
EWC East West Connect GmbH & Co. KG. The clear involvement of Mr.
Lamprecht, who also serves as Executive Advisor to the CEO of
Siemens AG and as Vice Chairman of the Board of Nokia Siemens
Networks, in RWE's deals with the Turkmen government, confirms our
assumption that RWE has been able to enter Turkmenistan's markets,
in part, due to the good relations that Siemens, and particularly
Mr. Lamprecht, has managed to build with high-ranking Turkmen
officials (Refs A and B).
5. (SBU) COMMENT: The signing of the PSA is RWE's first serious
step in implementing the Memorandum provisions. It took the company
exactly three months to move from the Memorandum to the PSA, rather
fast given conditions in Turkmenistan. The ceremony has not
divulged details of the most intriguing Memorandum provision, which
states that Turkmenistan and RWE will negotiate a long-term contract
for the sale and purchase of Turkmen natural gas. There is still no
information regarding the status of that contract. Block 23 itself
will not make RWE a key energy partner of the Government. The only
real indicator of RWE's importance to the Turkmen government will be
the progress the company is able to make in negotiating the
long-term contract for the sale and purchase of Turkmen natural gas.
END COMMENT
MILES