VZCZCXRO6507
OO RUEHIK
DE RUEHTA #1904/01 2950048
ZNR UUUUU ZZH
O 220048Z OCT 09
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6685
INFO RUCNCIS/CIS COLLECTIVE 2071
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNIRA/IRAN COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1442
RUEHKO/AMEMBASSY TOKYO 2142
RUEHUL/AMEMBASSY SEOUL 1077
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1631
RUEKJCS/SECDEF WASHINGTON DC
RUEKJCS/JOINT STAFF WASHINGTON DC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/USOFFICE ALMATY 1952

UNCLAS SECTION 01 OF 02 ASTANA 001904 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, EEB/ESC, S/EEE, S/CIEA 
STATE PLEASE PASS TO USTDA 
 
E.O. 12958: N/A 
TAGS: PGOV PREL ECON EINV EPET KZ
SUBJECT:  KAZAKHSTAN:  KAZENERGY VERSUS KIOGE 
 
ASTANA 00001904  001.3 OF 002 
 
 
¶1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
¶2.  (SBU) SUMMARY:  This fall, two major energy conferences in 
Kazakhstan clashed head-on.  On September 24-25, the KazEnergy 
business association, chaired by Timur Kulibayev, President 
Nursultan Nazarbayev's son-in-law, held its fourth annual Eurasian 
Energy Forum in Astana.  Just two weeks later, on October 7-8, the 
London-based ITECA Corporation held the 17th annual Kazakhstan 
International Oil and Gas Conference and Exhibition (KIOGE) in 
Almaty.  The close proximity of the two events forced frustrated 
energy executives to choose between a more elite, policy-oriented 
conference in the capital and the larger, more technical conference 
and exhibition in the former capital.  In the end, both conferences 
drew large crowds.  Though attendance declined from past years, the 
business community attended the KIOGE event in Almaty, but most 
government officials and senior executives chose to attend the 
KazEnergy conference in Astana, perhaps signaling the growing 
influence of Kulibayev.  END SUMMARY. 
 
PUTTING ON THE RITZ 
 
¶3.  (SBU) This year's KazEnergy Forum was headlined by Prime 
Minister Karim Masimov, Minister of Energy and Mineral Resources 
Sauat Mynbayev, Kulibayev, and keynote speaker and former Chancellor 
of Germany Gerhard Schroeder.  Other notable participants included 
Rovnag Abdullayev, President of the State Oil Company of the 
Azerbaijan Republic (SOCAR), Columbia University professor Robert 
Legvold, and Martha Brill Olcott of the Carnegie Endowment for 
International Peace.  (NOTE:  Former Vice President Richard Cheney 
was expected to attend as well, but canceled at the last minute for 
personal reasons, sorely disappointing the conference organizers. 
END NOTE). 
 
¶4.  (SBU) More than 600 people paid $1,500 each to attend the 
two-day conference, and Tengizchevroil paid $200,000 for the 
privilege of sponsoring the event, which was held in the huge Palace 
of Independence conference center.  This year, for the first time, 
the KazEnergy conference also included an exhibition by 
international oil companies and oil service companies, which many 
participants saw as a shot across the bow at KIOGE.  KazEnergy week 
officially ended on Saturday, September 26, with an annual golf 
tournament sponsored by ExxonMobil, which Mynbayev and Kulibayev 
attended. 
 
THE KAZENERGY CHALLENGE 
 
¶5.  (SBU) Richard Fritz, Public Relations Manager for Agip 
Kazakhstan North Caspian Operating Company, told Energy Officer on 
September 24 that he expects the KazEnergy Forum to become more 
popular than KIOGE, because it has the ability to attract high-level 
political and business leaders.  "KIOGE is still an important venue 
for the oil service companies," he said, "but it's become more 
technical, and is less relevant" to the international oil companies 
(IOCs).  Carlos Lozano, Financial Director of Spain's Repsol, 
confided to Energy Officer that the representatives of many IOCs 
have become increasingly critical of KIOGE in recent years.  "They 
don't draw the big names anymore," he said, "and the focus is more 
technical.  Plus, the hotels in Almaty require 100% prepayment and a 
three- to four-night minimum stay at 'special' KIOGE rates.  It's a 
racket!"  Lozano also noted that KIOGE is managed by London-based 
ITECA Corporation, while KazEnergy is organized by a local company, 
Expo.kz, which responds to the government's call for increasing 
local content in goods and services. 
 
KIOGE ATTENDANCE DOWN 
 
¶6.  (SBU) With the notable exception of Deputy Secretary of Energy 
Daniel Poneman, the KIOGE conference did not draw as many headliners 
as KazEnergy, due in part to the arrival in Astana on October 6 of 
French President Nicolas Sarkozy.  The government was represented at 
KIOGE by Vice Minister of Energy and Mineral Resources Lyazzat 
 
ASTANA 00001904  002.3 OF 002 
 
 
Kiinov and President of KazMunaiGas Kairgeldy Kabyldin.  Attendance 
at the KIOGE conference was comparable to last year (approximately 
800 people), but U.S. companies with booths at the exhibition told 
the DCM on October 7 that attendance was noticeably down from 
previous years, and that business was not as brisk. 
 
¶7.  (SBU) COMMENT:  This year, assisted by French President Nicholas 
Sarkozy's trip to Astana on the eve of KIOGE, might mark the turning 
point in the KazEnergy Forum's efforts to replace KIOGE as 
Kazakhstan's premiere energy event.  Whether or not Sarkozy's visit 
simply provided an excuse for government officials to tarnish the 
luster of KIOGE in favor of rising-star Kulibayev's event, most 
observers see the KazEnergy/KIOGE evolution as a continuation of the 
relocation of power to Astana -- following in the long line of 
energy companies who have moved their base of operations out of 
Almaty.  END COMMENT. 
 
HOAGLAND