VZCZCXRO7164
PP RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHAK #4241/01 2020707
ZNY CCCCC ZZH
P 210707Z JUL 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC PRIORITY 7417
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHTA/AMEMBASSY ALMATY 2219
RUEHAH/AMEMBASSY ASHGABAT 1903
RUEHGB/AMEMBASSY BAGHDAD 0685
RUEHKB/AMEMBASSY BAKU 1399
RUEHKV/AMEMBASSY KIEV 0730
RUEHMO/AMEMBASSY MOSCOW 5466
RUEHSI/AMEMBASSY TBILISI 3051
RUEHBS/USEU BRUSSELS
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHDC
RHEHAAA/NSC WASHDC
RHMFISS/HQ USEUCOM VAIHINGEN GE
RUEUITH/ODC ANKARA TU

C O N F I D E N T I A L SECTION 01 OF 02 ANKARA 004241 
 
SIPDIS 
 
SIPDIS 
 
USDOC FOR 4212/ITA/MAC/CPD/CRUSNAK 
DOE FOR CHARLES WASHINGTON 
EUR ALSO FOR MATT BRYZA 
 
E.O. 12958: DECL: 07/19/2016 
TAGS: EPET ENRG PREL TU AZ GG RU
SUBJECT: TURKEY: ENERGY MINISTER ON CASPIAN GAS TO EUROPE 
 
 
Classified By: AMBASSADOR ROSS WILSON FOR REASONS 1.4 (B,D) 
 
 ¶1.  (C)  Summary.  Meeting on the margins of 
Baku-Tbilisi-Ceyhan oil pipeline inauguration ceremonies in 
Istanbul on July 12, Deputy Secretary of Energy Clay Sell and 
Turkish Energy Minister Hilmi Guler reviewed Turkish-U.S. 
cooperation in helping Europe diversify its natural gas 
supplies as well as cooperation in Turkey's domestic energy 
sector.  Guler highlighted his worry that time was working 
against efforts to provide Europe with sources of gas as 
alternatives to Russia.  Noting that winter is coming, he 
feared that Russia would again pressure and threaten Turkey 
and other countries to enter into long-term arrangements that 
could preclude development of Caspian gas supplies from 
Azerbaijan, Kazakhstan, or Turkmenistan.  He doubted 
Azerbaijani and BP claims that large amounts of newly found 
Azeri gas could be made available quickly, and therefore 
urged that efforts be made with Kazakhstan and Turkmenistan 
as well.  Sell and Guler agreed that there were good 
opportunities for U.S.-Turkey cooperation on energy 
efficiency as well as to develop alternative sources of 
energy in Turkey, including nuclear, hydrogen, wind, and 
solar, as well as cooperation on clean coal technologies. 
Other participants in the meeting included Ambassador, EB A/S 
Dan Sullivan, SCA PDAS Steven Mann, and DOE, State and 
Embassy Staff, as well as Turkish Energy Ministry staff and 
MFA Energy expert Mithat Rende.  End Summary. 
 
----------------------------- 
New Sources of Gas for Europe 
----------------------------- 
 
¶2.  (C)  Deputy Secretary Sell extended the greetings of the 
President and Secretary Bodman and congratulated the Minister 
on the opening of the BTC pipeline.  He asked for the 
Minister's thinking on next steps needed to solidify Turkey's 
role as an energy hub, especially for gas.  Minister Guler 
stressed that time was of the essence in providing Europe 
with access to new sources of natural gas and noted that work 
on the Turkey-Greece Interconnector (TGI) project was well 
underway.  Guler said he doubted claims by Azerbaijan and BP 
that sufficient gas reserves were available in Azerbaijan to 
provide large volumes to Europe.  Specifically, he found 
unconvincing their claims that 50 bcm per year could be 
available for export.  At the same time, some European 
countries and companies, particularly Austria, are ignoring 
their own principles and those of the Energy Charger by 
seeking Iranian gas for the Nabucco project.  Given these 
alternatives, Guler said he believes that Kazakh and Turkmen 
gas exports to Europe via Turkey must also be developed. 
 
¶3.  (C)  Guler reiterated that timing was critical.  He is 
especially concerned about the upcoming winter and pressure 
that could be applied by Russia on consumers like Turkey, 
Georgia, Greece and Italy as well as Azerbaijan, which is 
still a gas importer.  Gazprom, Guler said, is making 
progress pressuring European countries and is "signing new 
contracts every week."  Recalling the impact of the early 
2006 shut off of gas to Ukraine and the shortages that had 
caused in Turkey, Guler said, "I don't want to face that 
situation again."  Ambassador Wilson pointed out that that 
was precisely why we were very interested in working quickly 
and aggressively with Turkey and Azerbaijan to get larger 
volumes of Azerbaijani gas to Turkey and to Europe. 
Otherwise Russia could lock-in long term supply contracts 
that would lock-out Azerbaijani gas. 
 
--------------------------------------------- 
Turkey's Nuclear and Alternative Energy Plans 
--------------------------------------------- 
 
¶4.  (C)  Sell said he was encouraged by Turkey's interest in 
developing nuclear electricity generation capacity.  He said 
the United States was supportive of this and ready to help 
 
ANKARA 00004241  002 OF 002 
 
 
Turkey achieve its goal.  This was consistent with the 
President's Global Nuclear Energy Partnership (GNEP).  Sell 
hoped that U.S. companies, which have the most advanced 
technologies, would be welcome.  Guler noted that developing 
nuclear generating capacity was needed to meet growing energy 
needs and reduce dependence on gas imports.  He said the 
private sector would make the investments in nuclear 
generation.  He said Turkey also hoped to encourage 
investment in other nuclear applications, such as in medicine 
and agriculture.  Noting that Turkey was an agricultural 
country and held 72% of global boron reserves, Guler said 
Turkey was interested in other areas of energy cooperation 
with the United States, including biomass and hydrogen.  He 
is also interested in working with the United States on clean 
coal generation technology, as he had discussed with 
Secretary Bodman in February. 
 
SIPDIS 
 
¶5.  (C)  Guler favorably described oil and gas exploration by 
U.S. companies on the Black Sea coast and in southeastern 
Turkey.  In response to Sell's question about "Bosphorus 
bypass" pipelines, Guler said that the Turkish government was 
backing the Samsun-Ceyhan project, and described the 
potential of Ceyhan as a regional energy oil and gas center. 
In addition to Samsun-Ceyhan, he is interested in working 
with the United States on bringing Iraqi gas to Ceyhan along 
the existing right of way of the Kirkuk-Yumurtalik pipeline 
and building an LNG facility in Ceyhan to export Iraqi gas. 
Ambassador reminded the Minister that U.S. companies 
continued to be interested in the "protocol" hydropower 
projects agreed to in the late 1990s, and said that moving 
forward on them would send a good signal to investors.  Guler 
said that Turkey had improved its laws to encourage foreign 
investment in the sector and would continue doing so. 
 
¶6.  (U)  This cable has been cleared by DOE. 
 
Visit Ankara's Classified Web Site at 
http://www.state.sgov.gov/p/eur/ankara/ 
 
WILSON