R 061752Z FEB 09
FM AMEMBASSY BRASILIA
TO SECSTATE WASHDC 3501
INFO AMEMBASSY BUENOS AIRES 
AMCONSUL RECIFE 
AMCONSUL RIO DE JANIRO 
AMCONSUL SAO PAULO 
DEPT OF ENERGY WASHDC
NSC WASHDC

C O N F I D E N T I A L BRASILIA 00158 
 
 
CONFIDENTIAL 
 
DEPARTMENT FOR WHA/BSC, WH/EPSC, AND USOAS 
DOE FOR GWARD, CGAY, AND RDAVIS 
 
E.O. 12958: DECL: 02/05/2019 
TAGS: PREL ENRG KSUM ECON BR
SUBJECT: Hemispheric Energy and Brazil? Depends who you ask 
 
Classified By: Ambassador Sobel, Reason 1.4 (b) and (d) 
 
¶1. (C) Summary: Ambassador Sobel recently met with Brazil's Under 
Secretary equivalent for Energy and Technology at the Ministry of 
External Relations (MRE), Ambassador Andre Amado, to discuss 
continuing bilateral biofuels efforts.  Over the course of the 
meeting, the idea of hemispheric energy cooperation arose and Amado 
used the occasion to voice his adamant opposition.  Despite various 
attempts to find an opening in his position, it was clear that Amado, 
and as a result MRE, will be very unlikely to support hemispheric 
energy initiatives currently under consideration, barring the strong 
engagement of other ministries.  There is support in other quarters 
of the government, including from the increasingly powerful Minister 
of Mines and Energy Edson Lobao.  The success of any attempts to 
enlist Brazil's support in these efforts will depend heavily on 
approaching the right elements within the GOB and packaging the 
proposal appropriately. END SUMMARY 
 
¶2. (C) During a meeting with Ambassador Sobel on February 4 to 
discussing ongoing biofuels efforts, Ambassador Andre Amado described 
his plans for a visit to the U.S on February 25; the Brazilian 
Embassy has proposed meetings with WHA A/S Tom Shannon, U/S Bill 
Burns, and Senator Lugar.  Amado noted he wasn't sure it was a good 
idea for him to meet with Senator Lugar.  When pressed for the 
reasons, Amado said it would be a difficult meeting for him given his 
disagreement with the basic premise of Lugar's proposal for a 
Hemispheric Energy Compact.  He said he didn't believe it was 
advisable to engage "hostile nations" that may not want our help.  He 
felt we would both do better to concentrate on working where we can 
"be all encompassing," such as in developing nations in Africa and 
South Asia (he cited the Philippines, Thailand, and Vietnam) that 
would welcome all aspects of assistance.   Amado pressed to include 
this type of focus on developing countries in other regions for our 
bilateral biofuels cooperation under the 2007 Memorandum of 
Understanding, stating that the United States was "behind the 
starting line and needs to overcome the heritage of the Bush years." 
In Amado's view, most U.S. assistance in this area has focused on 
opening business markets but to be successful, he argued, it should 
be more about assisting poor nations.  (Note: Brazil advocated and we 
agreed to extend our bilateral biofuels cooperation in third 
countries to Africa - Senegal and Guinea Bissau - but the GOB is 
still working to secure funding for the studies they agreed to 
finance and execute in those countries.) 
 
¶3.  (C) Ambassador Sobel agreed that working together bilaterally in 
developing countries could be positive but noted that need not 
exclude the possibility of hemispheric cooperation.  Amado grew 
visibly more agitated as he demanded, "Do you want another FTAA in 
energy?"  Ambassador Sobel made the point that resistance by five or 
six countries to hemispheric wide cooperation should not limit all 34 
nations.  Amado then replied, "If you insist on doing this, we won't 
be there holding your hand."  Ambassador Sobel then cautioned that 
this was an issue of immense interest in Washington and that Amado 
should not be surprised to hear a great deal about hemispheric energy 
during his upcoming visit. 
 
¶4.   (C) When asked whether he made room for the possibility of 
building a positive agenda for the hemisphere, focusing on the areas 
we can agree on, even if relatively modest to start, Amado asked 
"what have you been doing hemispherically?  We've been working on 
integration, bilaterally.  Brazil-Paraguay, Brazil- Venezuela, 
Brazil- Argentina, Brazil-Bolivia, look where that's gotten us!" 
(Note: Amado was referencing bilateral energy cooperation projects 
such as Itaipu dam, an oil refinery with Venezuela, and sales of 
natural gas between Bolivia, Argentina, and Brazil: all of which have 
fallen victim to contract difficulties and have become quite 
controversial in Brazil.) 
 
¶5.   (c) In stark contrast to Amado's opposition to hemispheric 
cooperation, which echoes prior conversations with various officials 
at MRE, the Ministry of Energy has been positively inclined.  In a 
meeting on January 14 with Minister of Mines and Energy Edson Lobao, 
the Ambassador, at the request of Department of Energy, solicited 
Lobao's support for a possible hemispheric energy conference. 
Ambassador Sobel noted that it was important to send the new 
administration the message that Brazil wanted to work with the United 
States, especially in light of the December 2008 Brazil-sponsored 
Bahia summit with all the countries of the hemisphere other than the 
U.S and Canada, and to demonstrate that such initiatives do not 
preclude hemispheric cooperation.  Lobao immediately indicated his 
eagerness to participate and work with the United States.  When the 
Ambassador suggested that active Brazilian support of such an effort 
might help encourage the participation of other countries in the 
hemisphere, Lobao seemed inclined to agree to that as well, but his 
international advisor, Ambassador Rubem Barbosa (on detail from MRE), 
preempted his response and noted that sponsorship or promotion of 
such an event would require MRE approval and they would have to 
consult the appropriate people at MRE (i.e., Amado). 
 
¶6.   (C) Anticipating this response, Econoff had previously raised 
the conference idea with the Director of the Renewable Energy 
Division at MRE, Claudia Vieira Santos.  Santos's initial reaction 
was that there was much negativity in the region against the United 
States and it wasn't in Brazil's interest to work too cooperatively 
with the USG in South America, recalling that the 2007 Biofuels MOU 
had cost them significant political capital with their neighbors. 
When she learned that UNDP/ECLAC, the Inter-American Development 
Bank, Andean Development Corporation, OLADE and others might be 
involved in the potential conference, she indicated that this fact 
could change the picture significantly and might make Brazilian 
participation in such an event more possible. 
 
¶7.  (C) In a subsequent meeting between the Ambassador and Defense 
Minister Jobim, Jobim counseled the Ambassador to let Amado's 
comments "go in one ear and out the other."  He indicated that he 
felt the balance of power within the GOB on energy matters had 
shifted to Minister Lobao and as a result MRE would not have the 
final word on hemispheric energy cooperation. 
 
¶8.   (C) COMMENT:  As Washington considers various formulations for 
the Summit of the Americas, Energy Partnership of the Americas, and a 
DOE-sponsored Energy symposium, there are two primary factors that 
will determine USG success in gaining Brazilian participation or 
support. 
 
-- Factor 1: It is critical to approach the issue through the right 
channels.  Whatever the proposal, if it involves hemispheric energy 
cooperation, MRE has the interagency lead on the issue and will 
likely try to veto positive GOB response absent pressure from other 
players within the GOB and legislature.  There are parts of the GOB 
that would support such initiatives, such as Mines and Energy where 
it is widely acknowledged that Minister Lobao has won the contest 
within the GOB for leadership in the wide range of energy sector 
issues.  His friendship with the newly elected President of the 
Senate, fellow party member - and former President of Brazil - Jose 
Sarney, may give him added clout in intergovernmental territory 
disputes.  These players need to be brought into the calculations 
early so that we avoid filtering all information through the 
Brazilian Embassy and MRE, thereby allowing them the opportunity to 
exercise negatively their preemptory perogative over international 
affairs.  To cultivate support from other increasingly powerful 
ministries, approaches should made directly to them without filtering 
the request through MRE channels, although being sure to keep MRE 
apprised of our efforts.  That said, there may be a more direct and 
more effective route.  Given the intense desire here to demonstrate 
good will with the new administration, post judges that the most 
effective path to yes on any of these initiatives would be a direct 
request from President Obama to President Lula - or the White House 
to Brazil's Presidential Office Planalto - without giving MRE the 
chance to campaign against it in advance.  Jobim's comments hint at a 
territorial struggle that must be considered in any approach. 
According to Jobim's comments, the decision makers on this issue will 
be at Planalto or the Ministry of Mines and Energy. 
 
-- Factor 2: The Summit of the Americas (SOA) is viewed skeptically 
at best in Brazil, due to the perception that it is a U.S. initiative 
and U.S. dominated forum.  The extent to which hemispheric energy 
proposals are separated from SOA, spearheaded by other nations in the 
hemisphere other than the United States (especially countries not 
commonly viewed as being aligned with the United States), or 
sponsored by regional organizations, will positively impact the 
chances of gaining Brazilian acceptance. 
 
 
SOBEL