US embassy cable - 06ASHGABAT140

TURKISH AMBASSADOR POSITS GAZPROM PLANS TO ESTABLISH A MONOPOLY IN EUROPE

Identifier: 06ASHGABAT140
Wikileaks: View 06ASHGABAT140 at Wikileaks.org
Origin: Embassy Ashgabat
Created: 2006-01-27 12:17:00
Classification: CONFIDENTIAL
Tags: ECON ENRG EPET GG KZ PGOV PREL RS TX UP US
Redacted: This cable was not redacted by Wikileaks.
VZCZCXRO4268
PP RUEHDBU
DE RUEHAH #0140 0271217
ZNY CCCCC ZZH
P 271217Z JAN 06
FM AMEMBASSY ASHGABAT
TO RUEHC/SECSTATE WASHDC PRIORITY 6926
INFO RUCNCIS/CIS COLLECTIVE
RUEHAK/AMEMBASSY ANKARA 2497
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RHEHNSC/NSC WASHDC
RUEHBS/USEU BRUSSELS
C O N F I D E N T I A L ASHGABAT 000140 
 
SIPDIS 
 
SIPDIS 
 
SECSTATE FOR DAS BRYZA, EUR/CACEN, SA DAS GASTRIGHT 
 
E.O. 12958: DECL: 01/27/2016 
TAGS: ECON, ENRG, EPET, GG, KZ, PGOV, PREL, RS, TX, UP, US 
SUBJECT: TURKISH AMBASSADOR POSITS GAZPROM PLANS TO 
ESTABLISH A MONOPOLY IN EUROPE 
 
 
Classified By: Ambassador Tracey Ann Jacobson for reasons 1.4 (b) and ( 
d) 
 
1.  (C) During a lunch he hosted for Georgian Ambassador 
Petriashvili, Ukrainian Ambassador Mayko, and U.S. 
Ambassador, Turkish Ambassador Hakki Akil argued passionately 
(with the help of visual aids) that Gazprom is intent on 
establishing a monopoly of gas supply to Europe.  Akil argued 
that Gazprom is doing its utmost to gain control over the 
"upstream" -- ie., gobbling up Central Asian gas supplies 
(witness recent deals in Uzbekistan and Kazakhstan and 
approaches to Niyazov to buy all Turkmen gas).  Further, 
Gazprom is pursuing pipeline purchases to control the 
midstream, and is even pushing deals in Europe to buy into 
distribution networks to influence up the downstream.  Akil 
believed that a secondary goal of Russian pipeline projects 
(Baltic, Yamal 2) is to bypass Ukraine.  Akil, Mayko and 
Petriashvili agreed that Russia would use any such monopoly 
to "blackmail" Europe politically as well as economically, 
but lamented that the EU either did not yet recognize the 
danger, or was unwilling to confront it given economic links 
with Russia.  Akil was particularly concerned that Russia was 
preparing to make some political concessions to Turkey (eg., 
agreeing to approve the UN SecGen's Cyprus report, which it 
is currently blocking) in order to get approval to double the 
capacity of Blue Stream -- which Akil argued would kill any 
real chances for a new Trans Caspian project. 
 
2.  (C) Akil identified Kazakhstan and Turkmenistan as the 
only potential "weak points" in Gazprom's strategy.  Mayko 
and Petriashvili opined that Kazakhstan was already "lost" 
and said "only the USG" could give Niyazov the support he 
would require to break away from Russia.  Ambassador reviewed 
the problems with the first TCP, and noted that even if the 
situation now was more positive, it would be difficult for 
the USG to give Niyazov the real strategic partnership he 
believes he needs to balance Russian pressure without more 
progress in other areas of the bilateral relationship (eg., 
human rights) and a more compelling indication of his 
interest in the project.  Ambassador noted that Secretary 
Rice has spoken quite clearly on the unacceptability of 
Russia's use of energy policy to pursue its political agenda, 
and also that the USG remains interested in multiple export 
routes for Turkmen gas and diversification of gas supplies 
for Europe.  However, the USG has not yet committed its 
resources, and cannot commit U.S. business, to a single 
trans-Caspian option. 
 
3.  (C) Mayko left the lunch early for a meeting with Foreign 
Minister Meredov to receive the GOTX's formal response to 
Ukrainian President Yushchenko's proposal of a 
Trans-Caspian/Black Sea export option to Ukraine; he had 
"preliminary information" that the response would be negative 
(ie., "we are interested and will study further.")  Akil 
argued that even a rejection of the somewhat grandiose 
Ukrainian proposal would not imply an unwillingness to pursue 
the smaller TCP-only option.  Mayko hoped to receive a 
readout of Niyazov's meetings with President Putin this week, 
which he promised to share (Note:  the GOTX, to our 
knowledge, has not given any mission a readout of these 
meetings.) 
 
4.  (C) Comment:  Petriashvili said during a meeting with 
Georgian President Saakashvili yesterday, the Vice Chair of 
the Russian Duma, in reference to the current gas crisis in 
Georgia, said:  "We already warned you.  Either you are on 
your knees to us, or your people will freeze every winter." 
Regardless of the veracity of this anecdote, the Russians 
have already made clear that they're willing to use their 
control of energy supplies to pursue their political agenda, 
at least within the near abroad.  The implications of Russia 
establishing this kind of influence in Europe are worrying. 
What role Niyazov will play in the development of this game 
remains unclear. 
 
 
 
 
JACOBSON 

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