08ASTANA2008, KAZAKHSTAN: KAZMUNAIGAS PRESIDENT DISCUSSES GEORGIA,

WikiLeaks Link

To understand the justification used for the classification of each cable, please use this WikiSource article as reference.
Discussing cables
If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol).Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #08ASTANA2008.
Reference ID Created Released Classification Origin
08ASTANA2008 2008-10-08 11:33 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO3204
OO RUEHAG RUEHAST RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHTA #2008/01 2821133
ZNR UUUUU ZZH   CTNG RUEWCSE 6678 2821217...
O 081133Z OCT 08
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 3546
INFO RUCNCIS/CIS COLLECTIVE 0676
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0078
RUEHKO/AMEMBASSY TOKYO 0788
RUEHIT/AMCONSUL ISTANBUL 0029
RUEHVEN/USMISSION USOSCE 1962
RUCNDT/USMISSION USUN NEW YORK 1910
RUEHNO/USMISSION USNATO 2247
RUEHBS/USEU BRUSSELS
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 0233
RUEKJCS/JOINT STAFF WASHDC
RUEKJCS/SECDEF WASHDC 0155
RUCPDOC/DEPT OF COMMERCE WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS SECTION 01 OF 02 ASTANA 002008 
 
C O R R E C T E D COPY: DROPPED AN ADDRESSEE 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, EEB/ESC 
 
E.O. 12958:  N/A 
TAGS: PGOV PREL EPET EINV GG KZ
 
SUBJECT:  KAZAKHSTAN:  KAZMUNAIGAS PRESIDENT DISCUSSES GEORGIA, 
CRUDE TRANSPORT WITH AMBASSADOR STEVE MANN 
 
ASTANA 00002008  001.3 OF 002 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (U) SUMMARY:  KazMunaiGas (KMG) President Kairgeldy Kabyldin 
informed Eurasian Energy Diplomacy Coordinator Ambassador Steve Mann 
on October 6 that Kazakhstan remains committed to its strategic 
investments in Georgia.  Kabyldin requested assistance in persuading 
Azerbaijan to grant access to the Baku-Supsa pipeline, and also 
confirmed that British Petroleum (BP) is the only consortium partner 
which has not agreed to expand the capacity of the Caspian Pipeline 
Consortium (CPC) pipeline.  END SUMMARY. 
 
CONTINUED COMMITMENT TO GEORGIA 
 
3.  (SBU) In an October 6 meeting, KazMunaiGas (KMG) President 
Kairgeldy Kabyldin emphasized to visiting Eurasian Energy Diplomacy 
Coordinator Ambassador Steve Mann that Kazakhstan's long-term 
strategic investments in Georgia were not adversely affected by the 
conflict in South Ossetia.  He cited as examples KMG's decision to 
move forward with plans to expand the capacity of the Batumi oil 
terminal and explore the further development of the 
Baku-Tbilisi-Ceyhan (BTC) pipeline and rail infrastructure in 
Georgia.  (NOTE:  Regarding rumors that KMG intends to sell its 
KazTransGas-Tbilisi subsidiary, Kabyldin told the media on October 7 
that KMG would be willing to consider such a move, but that 
everything would depend on what it was offered.  END NOTE.) 
 
HELP WANTED WITH BAKU-SUPSA 
 
4.  (SBU) Kabyldin reiterated Kazakhstan's support for 
diversification of energy transport routes, including transport via 
tanker from Aktau to Baku, but noted that even with multiple routes 
and the anticipated expansion of the Atyrau-Samara and Caspian 
Pipeline Consortium (CPC) pipelines, oil transportation capacity has 
become increasingly constrained for Kazakhstan. "We have big 
transportation problems," he said.  Kazakhstan plans to ship up to 
10 million tons of crude annually through Atyrau-Samara and could 
ship up to an additional 5 million tons of TCO crude via the 
Baku-Supsa pipeline "right now," said Kabyldin.  TCO currently pays 
more than $35 per ton to transport oil by rail from Baku to Batumi, 
whereas it could send oil through the Baku-Supsa pipeline at 
approximately $0.37 per barrel.  Kabyldin said that KMG is prepared 
to buy the Baku-Supsa pipeline outright, or acquire shares in it, 
but the Government of Azerbaijan refuses to sell shares or grant 
access.  (NOTE:  The Baku-Supsa pipeline, which has a capacity of 
145,000 barrels per day, is owned by the Azerbaijan International 
Operating Company (AIOC), the Azerbaijani national oil company 
SOCAR, and the Government of Georgia.  END NOTE.) 
 
5.  (SBU) Kabyldin cited three main reasons why the Government of 
Azerbaijan has not agreed to grant access to Baku-Supsa:  (1) AIOC 
is building up its terminal in Kulevi, Georgia, and thus wants crude 
to flow to Kulevi, not Supsa; (2) AIOC would have to incur 
significant costs to modernize the Baku-Supsa pipeline; and (3) the 
owners of the Cross-Caspian Middle East Petroleum corporation would 
lose revenue if oil was transported via Supsa instead of Batumi. 
Kabyldin asked for assistance from the U.S. government to persuade 
President Aliyev to grant access to Baku-Supsa.  He said the only 
way to resolve this is to appeal directly to President Aliyev:  "If 
you convince Aliyev, SOCAR will soon get the message."  Kabyldin 
warned that if they cannot reach agreement with Azerbaijan on 
shipments from Baku onward, then their transportation options would 
be limited mainly to Russia.  "Without Baku," he said, "there can be 
no policy of transportation diversification." 
 
BP THE LONE HOLDOUT ON CPC EXPANSION 
 
6.  (SBU) According to Kabyldin, all of the CPC consortium members 
-- with the notable exception of BP -- have agreed to expand CPC 
capacity.  "BP is giving us a headache," he said.  (NOTE:  BP has 
 
ASTANA 00002008  002.3 OF 002 
 
 
little upstream stake in CPC expansion and is apparently holding 
firm to a short-term, cost of capital position.  END NOTE.)  BP owns 
approximately 6% of CPC through its holdings in Lukarco and 
Kazakhstan Pipeline Ventures (KPV).  Kabyldin said that KMG is 
prepared to purchase BP's share of KPV, but Luk
oil is not as eager 
to purchase BP's share of Lukarco.  Kabyldin maintained that Lukoil 
did not pay for its current share in Lukarco and thus would be 
reluctant to pay for additional Lukarco shares.  (NOTE:  Press 
reports have indicated that BP is asking for up to $1 billion for 
its combined share in CPC.  END NOTE).  In any case, said Kabyldin, 
"the ball is squarely in BP's court." 
 
7. (U) This cable was not/not cleared with Ambassador Mann. 
 
HOAGLAND

Wikileaks

Advertisements
Post a comment or leave a trackback: Trackback URL.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: