VZCZCXYZ0000
OO RUEHWEB

DE RUEHRH #1450 3060708
ZNR UUUUU ZZH
O 020708Z NOV 09
FM AMEMBASSY RIYADH
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1820
INFO RHEBAAA/DEPT OF ENERGY WASHINGTON DC

UNCLAS RIYADH 001450 
 
SENSITIVE 
SIPDIS 
 
STATE FOR NEA/ARP, FOR S/CIEA, AND FOR EB/ESC DOUG HENGEL 
DOE FOR AL HEGBURG 
 
E.O. 12958: N/A 
TAGS: EPET ENRG EINV PREL IEF SA
SUBJECT: RESOLVING THE INTERNATIONAL ENERGY FORUM 
CONTRIBUTION ISSUE 
 
REF: A. RIYADH 1397 
     ¶B. STATE 104692 
 
¶1. (U) Embassy Riyadh appreciates the assistance of the 
Departments of Energy and State in making $100,000 available 
to contribute to the International Energy Forum (IEF) expert 
committee's analysis of energy price volatility.  IEF 
officials have told the Embassy that they very much 
appreciate these funds, and strongly welcome USG 
participation on the steering committee, as well as U.S. 
experts on the committee. 
 
¶2. (U) IEF officials have also told us, however, that they 
still need to collect additional donations to ensure that the 
work of the experts' group will be fully funded.  In that 
regard, they note that the U.S. is the only country not to 
have provided all of the voluntary funds that the IEF 
assessed before the experts' group began its work.  They note 
that the U.S. assessment was $241,000, of which $100,000 has 
now been paid.   IEF officials also noted that no U.S. 
voluntary contributions were received for the regular budget 
during FY 2009 (the IEF estimates that the U.S. share of the 
annual budget is $500,000). 
 
¶3. (U) The chair of the steering group, Assistant Oil 
Minister Prince Abdulaziz bin Salman, told EconCouns on 
October 26 that it would be "personally embarrassing" if any 
delegations raised the issue of whether all steering group 
members have paid.  He expected that other countries would 
raise the issue.  We understand from our UK colleagues that 
this issue came up during last week's UK-Saudi energy 
bilaterals in London.  Prince Abdulaziz noted that the IEF 
can fund the costs of the experts' group from its operating 
budget for a few months as long as it has a firm U.S. 
commitment that the additional funds will come during FY 2010. 
 
¶4. (SBU) Comment:  From our vantage point, there seems to 
have been an initial unfortunate misunderstanding about what 
the U.S. was willing to contribute to the experts' group 
budget.  Rightly or wrongly, the chair of the steering group 
- Assistant Oil Minister Abdulaziz bin Salman - now feels 
personally on the hook to ensure that the U.S. contributes 
its full assessment.  We believe it may be useful to take a 
broader view of the situation and get beyond the specific 
issue of which side is right about the assessment.  Prince 
Abdulaziz is one of three or four key Saudi policy makers 
determining the future of Saudi oil policy.  He also is the 
chair of Saudi Arabia's newly formed national committee on 
climate change.  He has told us that he would like to work 
with the U.S. to forge a lasting partnership on renewable 
energy and efficiency measures.  He also wants U.S. support 
for Saudi Arabia's long-term development, including billions 
of dollars in investments in Saudi Arabia's National 
Industrial Strategy and projects like Dow's refinery in the 
Eastern province, and Exxon's proposed manufacturing facility 
- both worth dozens of billions of dollars. 
 
¶5. (SBU) Embassy Riyadh recommends Washington consider making 
a firm commitment to make a second voluntary contribution of 
$141,000 during FY 2010.  Ideally, we would make that 
commitment before the Steering Group meeting on November 14, 
although disbursement could come later.  That would allow 
that meeting to focus on the more important issue of the 
experts' group report and its recommendations, which will be 
briefed to the G20 next spring and may well influence future 
international energy policies.  It would also enhance our 
relations with a key Saudi policy maker just before the 
beginning of the climate change negotiations December 6 in 
Copenhagen, and would set the stage for a positive, 
productive bilateral energy dialogue in December and January. 
 
 
 
 
 
SMITH