Identifier
Created
Classification
Origin
10ASHGABAT73
2010-01-19 13:07:00
CONFIDENTIAL
Embassy Ashgabat
Cable title:
MI SWACO'S EIGHT-YEAR EXPERIENCE IN TURKMENISTAN
how-toVZCZCXRO1743 PP RUEHAG RUEHBI RUEHCI RUEHDBU RUEHLH RUEHNEH RUEHPW RUEHROV RUEHSL RUEHSR DE RUEHAH #0073 0191307 ZNY CCCCC ZZH P 191307Z JAN 10 FM AMEMBASSY ASHGABAT TO RUEHC/SECSTATE WASHDC PRIORITY 4088 INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE RUCNCIS/CIS COLLECTIVE RUCNMEM/EU MEMBER STATES COLLECTIVE RUEHAK/AMEMBASSY ANKARA 6138 RUEHBJ/AMEMBASSY BEIJING 3827 RUEHKO/AMEMBASSY TOKYO 3686 RUEHIT/AMCONSUL ISTANBUL 4380 RUEKJCS/JOINT STAFF WASHDC RUEAIIA/CIA WASHDC RUCPDOC/DEPT OF COMMERCE WASHDC RHEFDIA/DIA WASHDC RHEBAAA/DEPT OF ENERGY WASHDC RHEHNSC/NSC WASHDC RUEATRS/DEPT OF TREASURY WASHDC RUEKJCS/SECDEF WASHINGTON DC RUCNDT/USMISSION USUN NEW YORK 1422 RUEHVEN/USMISSION USOSCE 4311
C O N F I D E N T I A L ASHGABAT 000073
SIPDIS
STATE FOR SCA/CEN; EEB;
ENERGY FOR EKIMOFF/BURPOE/COHEN
COMMERCE FOR DSTARKS/EHOUSE
E.O. 12958: DECL: 01/19/2020
TAGS: EPET ECON PGOV EINV BTIO TX
SUBJECT: MI SWACO'S EIGHT-YEAR EXPERIENCE IN TURKMENISTAN
Classified By: Charge Sylvia Reed Curran for reasons 1.4 (b) and (d).
C O N F I D E N T I A L ASHGABAT 000073
SIPDIS
STATE FOR SCA/CEN; EEB;
ENERGY FOR EKIMOFF/BURPOE/COHEN
COMMERCE FOR DSTARKS/EHOUSE
E.O. 12958: DECL: 01/19/2020
TAGS: EPET ECON PGOV EINV BTIO TX
SUBJECT: MI SWACO'S EIGHT-YEAR EXPERIENCE IN TURKMENISTAN
Classified By: Charge Sylvia Reed Curran for reasons 1.4 (b) and (d).
1. (SBU) MI SWACO, a U.S. company represented in Turkmenistan
by its UK-based subsidiary M-I Drilling Fluids U.K. Ltd, has
been present in Turkmenistan since 2002. In Turkmenistan,
the company focuses on supplying drilling fluids and drilling
fluid-related equipment. The company also provides
consultations for utilization of the company-produced
drilling fluids. During its eight years in Turkmenistan, MI
SWACO has supplied its products and services to Dragon Oil
(UAE),Burren Energy (UK),Chalyk Energy (Turkey),and Mitro
International (Austria). MI SWACO has also supplied its
products to such Turkmen state companies as Turkmengaz,
Turkmennebit (Turkmen state oil company),and
Turkmengeologiya (Turkmen state geological service) on
numerous occasions. Currently, the company's Turkmenistan
branch employs 39 people, four of whom are expats, and has
two offices in country.
2. (C) The general director of MI SWACO's Turkmenistan branch
told Embassy economic assistant on January 15 that doing
business in Turkmenistan has been a challenge throughout the
company's eight-year tenure in the country. He added that
although the company has only one serious competitor,
Malaysian-based Skomi Oil Tools, it is difficult for MI SWACO
to compete with Skomi, because U.S.-based MI SWACO cannot
ship its products through Iran. Transit through Iran is
reportedly the cheapest way to ship goods to Turkmenistan
from the U.S. and U.K. As a result, the company has to
outperform its competitors by providing higher-quality
products and better service.
3. (C) According to the general director, the company has
managed to win Turkmen Government contracts by going through
the government's standard tender process, which it uses to
award most contracts, and has successfully delivered on its
contractual obligations. He hinted that, despite the
company's positive track record in Turkmenistan, some Turkmen
Government officials do not feel comfortable working with MI
SWACO because it is an American company. The company rep
also opined that MI SWACO's small size seemed to be an
advantage in the eyes of Turkmen, outweighing the U.S.
affiliation.
4. (SBU) COMMENT: MI SWACO's experience demonstrates that
U.S. companies can work successfully in Turkmenistan's energy
sector if they provide goods and services that are in demand
by the Turkmen Government and competitively priced. Quality
and customer service are also important factors. END COMMENT.
CURRAN
SIPDIS
STATE FOR SCA/CEN; EEB;
ENERGY FOR EKIMOFF/BURPOE/COHEN
COMMERCE FOR DSTARKS/EHOUSE
E.O. 12958: DECL: 01/19/2020
TAGS: EPET ECON PGOV EINV BTIO TX
SUBJECT: MI SWACO'S EIGHT-YEAR EXPERIENCE IN TURKMENISTAN
Classified By: Charge Sylvia Reed Curran for reasons 1.4 (b) and (d).
1. (SBU) MI SWACO, a U.S. company represented in Turkmenistan
by its UK-based subsidiary M-I Drilling Fluids U.K. Ltd, has
been present in Turkmenistan since 2002. In Turkmenistan,
the company focuses on supplying drilling fluids and drilling
fluid-related equipment. The company also provides
consultations for utilization of the company-produced
drilling fluids. During its eight years in Turkmenistan, MI
SWACO has supplied its products and services to Dragon Oil
(UAE),Burren Energy (UK),Chalyk Energy (Turkey),and Mitro
International (Austria). MI SWACO has also supplied its
products to such Turkmen state companies as Turkmengaz,
Turkmennebit (Turkmen state oil company),and
Turkmengeologiya (Turkmen state geological service) on
numerous occasions. Currently, the company's Turkmenistan
branch employs 39 people, four of whom are expats, and has
two offices in country.
2. (C) The general director of MI SWACO's Turkmenistan branch
told Embassy economic assistant on January 15 that doing
business in Turkmenistan has been a challenge throughout the
company's eight-year tenure in the country. He added that
although the company has only one serious competitor,
Malaysian-based Skomi Oil Tools, it is difficult for MI SWACO
to compete with Skomi, because U.S.-based MI SWACO cannot
ship its products through Iran. Transit through Iran is
reportedly the cheapest way to ship goods to Turkmenistan
from the U.S. and U.K. As a result, the company has to
outperform its competitors by providing higher-quality
products and better service.
3. (C) According to the general director, the company has
managed to win Turkmen Government contracts by going through
the government's standard tender process, which it uses to
award most contracts, and has successfully delivered on its
contractual obligations. He hinted that, despite the
company's positive track record in Turkmenistan, some Turkmen
Government officials do not feel comfortable working with MI
SWACO because it is an American company. The company rep
also opined that MI SWACO's small size seemed to be an
advantage in the eyes of Turkmen, outweighing the U.S.
affiliation.
4. (SBU) COMMENT: MI SWACO's experience demonstrates that
U.S. companies can work successfully in Turkmenistan's energy
sector if they provide goods and services that are in demand
by the Turkmen Government and competitively priced. Quality
and customer service are also important factors. END COMMENT.
CURRAN