Monthly Archives: January 2010

10ASTANA131, KAZAKHSTAN: PREPARED FOR SHERPA MEETING IN THE HAGUE

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Reference ID Created Released Classification Origin
10ASTANA131 2010-02-01 01:05 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO2622
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TO RUEHC/SECSTATE WASHDC IMMEDIATE 7326
INFO RUCNCIS/CIS COLLECTIVE 2417
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
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RUEHML/AMEMBASSY MANILA 1051
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RUEHBY/AMEMBASSY CANBERRA 0076
RUEHEG/AMEMBASSY CAIRO 0001
RUEHBU/AMEMBASSY BUENOS AIRES 0001
RUEHBR/AMEMBASSY BRASILIA 0001
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
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RUEHAST/AMCONSUL ALMATY 2238
RUEHUNV/USMISSION UNVIE VIENNA 0101

UNCLAS SECTION 01 OF 02 ASTANA 000131 
 
SENSITIVE 
SIPDIS 
 
 
STATE FOR SCA/CEN 
 
E.O. 12958: N/A 
TAGS: PGOV PREL PTER ENRG KNNP TRGY IAEA KZ
SUBJECT:  KAZAKHSTAN:  PREPARED FOR SHERPA MEETING IN THE HAGUE 
 
REF: (A) STATE 7493 
 (B) STATE 5891 
 
ASTANA 00000131  001.3 OF 002 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  On January 29, the CDA and the Dutch Ambassador 
jointly delivered the invitation to the February 9-11 preparatory 
meeting for the Global Nuclear Security Summit.  Umarov, who said 
Kazakhstan had no objections to the proposed work plan, presented 
Kazakhstan's comments on the Communique.  He asked for a bilateral 
meeting with U.S. Sherpa Gary Samore, if possible.  He offered 
Astana as the possible venue of another meeting, "if necessary." 
Umarov highlighted that Kazakhstan is one of the few countries that 
has completed the full cycle of disarmament.  He claimed that 
President Nazarbayev has urged Iran to follow Kazakhstan's example. 
END SUMMARY. 
 
3.  (SBU) The CDA and Dutch Ambassador to Kazakhstan Frans Potuyt 
jointly delivered ref A demarche to Deputy Foreign Minister Kairat 
Umarov on January 29.  Umarov noted that Kazakhstan, a country that 
willingly renounced its nuclear weapons, fully supports the Nuclear 
Security Summit and President Obama's vision for a nuclear-free 
world.  He noted that "many different views" were voiced at the last 
Sherpa meeting in Tokyo, in which he participated, and he commended 
the United States for producing a "magically-balanced" draft text 
for the Summit Communique. 
 
4.  (SBU) While Kazakhstan has no objections to the work plan, 
Umarov presented the CDA and Ambassador Potuyt with three proposed 
changes to the Communique (forwarded to the desk separately). 
Umarov said he hoped sherpas would be able to make significant 
progress on the draft communiqu and work plan, but said that if 
preparations required an additional meeting, he would like to offer 
Astana as the venue.  The CDA said she would convey the request. 
 
5.  (SBU) Noting that U.S. Sherpa Gary Samore had not been able to 
attend the Tokyo meeting, Umarov asked whether he will attend 
meeting in the Hague.  If possible, he requested a bilateral 
meeting.  The CDA promised to convey his request. 
 
6.  (SBU) Ambassador Potuyt asked for Umarov's views on whether the 
Nuclear Proliferation Treaty (NPT) should be discussed at the 
Summit.  Umarov said that the NPT Review Conference "has a very 
different task, and we agreed in Tokyo to separate" the NPT and the 
Summit.  (NOTE: Umarov essentially repeated ref B points that the 
Ambassador delivered to him on January 25.  END NOTE.) 
 
7.  (SBU) Umarov highlighted that of the invited countries, 
Kazakhstan is one of the few that "knows the full cycle of 
disarmament."  Umarov thanked the U.S. for its assistance in the 
years of Kazakhstan's development and implementation of its 
non-proliferation policies.  The CDA and Potuyt both commended 
Kazakhstan on its progress and cooperation with the international 
 
ASTANA 00000131  002.3 OF 002 
 
 
community. 
 
8.  (SBU) Kazakhstan recently established a Cabinet-level Commission 
on Non-proliferation, headed by State Secretary-Foreign Minister 
Saudabayev, underlined Umarov.  He highlighted Kazakhstan's proposal 
to host the international nuclear fuel bank as an example of its 
commitment to the safe use of nuclear power.  Umarov also noted 
Iranian support for Kazakhstan's nuclear fuel bank initiative.  He 
asserted President Nazarbayev encourages his Iranian counterparts 
"all the time to follow our example and make the nuclear program 
transparent."  CDA and Potuyt both commended Kazakhstan on its 
non-proliferation record and agreed that its experience should serve 
as a good role model for Iran. 
 
SPRATLEN

Wikileaks

10ASTANA122, KAZAKHSTAN: SECRETARY CLINTON’S SPEECH EVOKES DEBATE ON

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Reference ID Created Released Classification Origin
10ASTANA122 2010-01-29 10:27 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO1407
OO RUEHIK
DE RUEHTA #0122/01 0291027
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TO RUEHC/SECSTATE WASHDC IMMEDIATE 7324
INFO RUCNCIS/CIS COLLECTIVE 2415
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1776
RUEHKO/AMEMBASSY TOKYO 2482
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RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2230

UNCLAS SECTION 01 OF 02 ASTANA 000122 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, DRL, SCA/PPD, R 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM PREL KPAO KDEM KZ
SUBJECT:  KAZAKHSTAN:  SECRETARY CLINTON'S SPEECH EVOKES DEBATE ON 
VIRTUAL WAY FORWARD 
 
ASTANA 00000122  001.3 OF 002 
 
 
REFTEL:  09 ASTANA 1183 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  Following a viewing of Secretary of State 
Hillary Clinton's speech on Internet Freedom, a roundtable 
discussion by Kazakhstani Internet activists on January 22 in Almaty 
revealed broad agreement that Kazakhstani authorities seriously 
limit freedom of speech on the Internet.  However, two opposing 
views emerged regarding approaches to improve internet freedom in 
Kazakhstan.  Younger activists wanted to organize protest actions to 
abolish Kazakhstan's restrictive Internet law.  A more mature group 
highlighted the ineffectiveness of earlier protests and the 
counter-productiveness of repeating such efforts now.  END SUMMARY. 
 
3.  (U) On January 22, the Public Affairs Section in Almaty hosted a 
viewing of Secretary Clinton's speech on Internet Freedom, with 
Russian translation, followed by a one-hour round table discussion 
on Internet issues in Kazakhstan.  Twenty-five members of local NGOs 
and Internet media leaders took part in a freewheeling discussion 
following the speech. 
 
4.  (SBU) During the roundtable, members of the "For Free Internet" 
movement -- Galym Ageleuov, Murat Tungishbayev, Ulan Shemshet, and 
Almaz Kusherbayev -- who represent the younger generation -- argued 
that activists should seek to abolish Kazakhstan's Internet law by 
organizing protests.  (NOTE:  The Internet law, signed by President 
Nazarbayev in July 2009, reclassifies all websites as "media 
outlets," making them subject to Kazakhstan's media legislation. 
Civil society leaders and the international community raised 
frequent concerns that the law could be used to censor the Internet 
(reftel).  END NOTE.)  The young activists highlighted the example 
of "national patriots" who held a hunger strike that impeded 
adoption of the national unity doctrine.  Some proposed the 
organization of "flash mob" actions, arguing their relative 
effectiveness in the past compared to efforts by moderates, like the 
veteran media-watchdog NGO "Adil Soz," to negotiate with the 
government. 
 
5.  (SBU) Tamara Kaleyeva, President of "Adil Soz" (Foundation for 
Protection of Freedom of Speech), argued for a more moderate 
approach.  She said that protests had not prevented the Internet 
law's adoption, and that they now could not change anything. 
Kaleyeva highlighted that only 14% of Kazakhstanis have Internet 
access.  "It is necessary to increase the number of users in order 
to increase attention to this issue," she declared.  She added that 
the assertion that 2009 riots in Moldova were organized through the 
Internet was a principal arguments used to support adoption of the 
Internet law.  Kaleyeva's organization and Yuriy Mizinov, 
Editor-in-Chief of zonakz.net, are drafting a code of ethics for 
bloggers and a draft agreement between Internet media outlets and 
bloggers, which they plan to distribute for discussion.  The 
agreement seeks to increase bloggers' awareness of the law and 
prevent comments that might cause interethnic discord or be 
perceived as unconstitutional.  (NOTE:  Kazakhstan's legislation 
imposes heavy penalties for public comments that could incite ethnic 
hatred.  END NOTE.)  Kaleyeva strongly contended that this would be 
the best way to ensure the survival of Internet media within the 
framework of the current law.  She cautioned, however, that 
agreements with bloggers should not compel self-censorship, but 
rather should encourage writers to take responsibility for their 
products.  Several of the more radical activists disagreed with 
Kaleyeva, arguing the blogger agreement is a type of 
self-censorship. 
 
6.  (SBU) Yevgeniya Plakhina, a reporter for opposition newspaper 
"Respublika," noted that the official reason for adopting the 
Internet law was a struggle against pornography and with 
publications aiming to foment interethnic discord.  However, 
pornography still exists, these sites are accessible without 
problem, and pornographic sites have not been sanctioned.  Plakhina 
warned that the internet law mainly was targeted against civil 
society.  "This law is like a red button that will be pressed when 
 
ASTANA 00000122  002.3 OF 002 
 
 
necessary, e.g., before parliamentary elections." 
 
7.  (SBU) Zhanar Kasymbekova of the Ar.Rukh.Khak Foundation 
emphasized that the problem of Internet access exists not only in 
rural areas, but even in
 Almaty.  A recent survey by an NGO on 
Internet availability in student dormitories found that, although 
communication lines are in place, most dormitories do not have 
Internet access.  Kasymbekova suggested de-monopolization of 
Internet providers and continued efforts to change the current 
Internet law.  Another participant, Adil Dzhalilov, Director of 
MediaNet Program Development, highlighted Kazakhstan's vast 
territory and low population.  He said that communication companies 
should receive benefits and encouragement to build lines in rural 
areas.  He also noted the woeful un-development of the 
Kazakh-language Internet. 
 
8.  (SBU) COMMENT:  Secretary Clinton's address was a valuable 
catalyst for a lively discussion about the repercussions of 
Parliament's adoption of the Internet law.  Her speech, and the 
roundtable that followed, prompted the free exchange of ideas 
regarding what Internet freedom really means for Kazakhstan, but 
left many questions about what activists can do to improve it.  END 
COMMENT. 
 
SPRATLEN

Wikileaks

10ASTANA119, KAZAKHSTAN: U.S. OIL EXECUTIVES DISCUSS CORRUPTION,

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Reference ID Created Released Classification Origin
10ASTANA119 2010-01-29 08:04 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO1242
OO RUEHIK
DE RUEHTA #0119/01 0290804
ZNR UUUUU ZZH
O 290804Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7319
INFO RUCNCIS/CIS COLLECTIVE 2413
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1774
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RHEHNSC/NSC WASHDC 1970
RUEKJCS/SECDEF WASHDC 1820
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2226

UNCLAS SECTION 01 OF 02 ASTANA 000119 
 
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 SOCI KZ
SUBJECT:  KAZAKHSTAN:  U.S. OIL EXECUTIVES DISCUSS CORRUPTION, 
COMPETITION, AND THE INVESTMENT CLIMATE 
 
REF:    A. 09 ASTANA 2027 
        B. ASTANA 0061 
 
ASTANA 00000119  001.3 OF 002 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  On January 26, the outgoing and incoming CEOs of 
U.S. oil services company J. Ray McDermott conveyed to the 
Ambassador their optimism about the investment climate in 
Kazakhstan, and asserted that strong, fundamental corporate values 
and a refusal to engage in corrupt practices give U.S. companies a 
competitive advantage in the region.  END SUMMARY. 
 
J. RAY IN BAUTINO BAY 
 
3.  (U) J. Ray McDermott is a leading worldwide marine solutions 
company with fabrication facilities in the Americas, Middle East, 
Caspian, and Asia-Pacific.  McDermott specializes in the design, 
fabrication, transportation, and installation of offshore platforms, 
as well as the installation of offshore pipelines.  The company also 
operates a global fleet of vessels for the marine-construction 
industry, including combination derrick and lay barges.  Under the 
September 2008 lease agreement between McDermott and TenizService, 
the latter will reclaim 20 hectares of land from the Caspian Sea to 
build a steel fabrication yard in Bautino, north of Aktau, including 
landfill and sheet piling.  McDermott will provide engineering and 
construction of fabrication facilities, install utilities, procure 
yard equipment, and recruit and train Kazakhstani personnel to 
manage and operate the yard.  The annual production capacity is 
expected to be 12,000 metric tons, and the base is expected to be 
operational in the fourth quarter of 2010.  McDermott's Bautino 
fabrication yard would be just the second facility of this magnitude 
on Kazakhstan's Caspian shore with the capacity to build offshore 
oil platforms, drilling modules, and floating terminals that meet 
the demanding standards of the North Caspian's complex exploration 
and production projects. 
 
PROJECT IS BACK ON TRACK 
 
4.  (SBU) According to McDermott's outgoing CEO Robert Deason, the 
Bautino project is back on track after early delays and is 
progressing well.  He said the company restructured the contract 
after its joint-venture partner TenizService, in which national oil 
company KazMunaiGas (KMG) owns 49%, failed to meet its investment 
obligations.  Deason conceded that the new contract has yet to stand 
the test of time, but nevertheless, expressed his personal optimism 
about the company's prospects in Kazakhstan.   He expects the 
Bautino base to provide essential support services to all of the 
major offshore oil exploration projects in the Caspian, including 
Kashagan, N Block, and Pearls.  For example, Deason said that Shell 
(lead operator of the Pearls project) and ConocoPhillips (N Block) 
expressed interest in McDermott's services. 
 
"ALL ROADS LEAD TO TK" 
 
5.  (SBU) McDermott's Vice President for Europe and Central Asia, 
Dan Houser, said the biggest challenge McDermott faces is simply 
identifying the ownership structure of its partners and competitors. 
 "It's tough to say who owns what," Houser remarked.  Transparency 
in ownership structures is lacking, many subsidiaries and 
arms-length offshore partners exist, and "all roads lead to TK 
(Timur Kulibayev, President Nazarbayev's billionaire son-in-law)." 
Houser asserted that McDermott's regional competitors all have 
powerful political sponsors and effective lobbies.  For example, 
Italy's Saipem and The Lancaster Group, which is chaired by Nurlan 
Kapparov, former Vice Minister of Energy and Mineral Resources and 
former chairman of Kazakh Oil, KMG's predecessor, formed the 
joint-venture Ersai.  The Singapore-based Keppel, according to 
Houser, has a joint venture connected to Kulibayev. 
 
6.  (U) NOTE:  A January 27 Interfax report alleged that former BTA 
Bank chairman Mukhtar Ablyazov, who fled the country following 
 
ASTANA 00000119  002.3 OF 002 
 
 
accusations of embezzlement and financial fraud, claims that shares 
of AktobeMunaiGas were sold to the China National Petroleum 
Corporation illegally, and at half their market value.  According to 
Interfax, Ablyazov sent a letter to several law-enforcement agencies 
naming a senior government official (reportedly Kulibayev) allegedly 
responsible for the illegal tr
ansaction.  Interfax highlighted 
Ablyazov's allegations that the state's 25% stake in AktobeMunaiGas 
was sold "at a price far below market value."  END NOTE. 
 
CULTURE OF "COMPLIANCE" 
 
7. (SBU) Deason expressed concern about a culture of "compliance" 
(corruption) in Kazakhstan.  He said that when McDermott first 
entered the country, they were approached by brokers claiming they 
could help the company obtain contracts, "but that was the last 
thing we wanted to hear.  We just want to compete and win, fair and 
square," he underlined.  Deason declared that McDermott did not have 
a single corruption case worldwide during his tenure.  McDermott 
Vice President Dan Houser recalled a visit to the company by 
Kazakhstan's Financial Police, who initially charged the company 
with operating unlicensed planning software.  He stated the company 
quickly produced the license, resolving the issue.  Deason 
concluded, "If you follow the rules, cross your Ts, and stay in 
bounds, you can get things done in Kazakhstan." 
 
U.S. COMPETITIVE ADVANTAGE 
 
8.  (SBU) When Italy's ENI was the lead operator on the Kashagan 
project, Deason asserted, "It was hard for American contractors to 
get a fair shake."  He claimed that ENI would direct its fabrication 
services to Saipem, in which ENI owns a 40% stake.  He now expects 
McDermott to win more business in the Caspian region despite 
increasing competition, notably from Korean companies.  When asked 
to describe McDermott's competitive advantage, Deason underlined 
that it is no longer the company's capital, technology, or global 
reach, but rather its values.  "People trust Americans," he said. 
"We're not as desperate to please, not as willing to compromise. 
We're reliable, fair partners.  We keep our word, and deliver on our 
commitment," unlike competitors from other countries that attempt to 
renegotiate a deal once they realize they have made a promise they 
cannot keep. 
 
9.  (SBU) COMMENT:  As KMG Vice President Maksat Idenov (ref B) has 
made abundantly clear, the reputation of U.S. companies for honest, 
transparent business practices can give them a competitive advantage 
in Kazakhstan.  Although investing in Kazakhstan can present 
challenges, we are pleased to note that U.S. companies, like 
McDermott, continue to play fair and win big.  END COMMENT. 
 
SPRATLEN

Wikileaks

10ASTANA109, KAZAKHSTAN: ZHOVTIS CASE TO SUPREME COURT

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Reference ID Created Released Classification Origin
10ASTANA109 2010-01-28 10:33 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO0322
OO RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
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DE RUEHTA #0109/01 0281033
ZNY CCCCC ZZH
O 281033Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7308
INFO RUCNCIS/CIS COLLECTIVE 2411
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
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RHEHNSC/NSC WASHDC 1968
RHMFISS/CDR USCENTCOM MACDILL AFB FL

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 000109 
 
SIPDIS 
 
STATE FOR SCA/CEN, DRL, EUR/RPM 
 
E.O. 12958: DECL: 01/28/2020 
TAGS: PGOV PREL PHUM OSCE KZ
SUBJECT:  KAZAKHSTAN:  ZHOVTIS CASE TO SUPREME COURT 
 
REFTEL:  09 ASTANA 2141 
 
Classified By: Charge d' Affaires Pamela Spratlen:  1.4 (b), (d) 
 
1. (C) SUMMARY:  Vitaliy Voronov, lawyer for imprisoned human-rights 
activist Yevgeniy Zhovtis filed on January 27 a motion to request the 
Supreme Court review the case.  The court has one month to decide 
whether to accept the case and an additional month to issue a 
decision.  Cautiously optimistic that the Supreme Court will rule in 
Zhovtis' favor, Voronov stressed that it will be a "political 
decision."  He believes the Kazakhstani government should be made to 
understand that this is the easiest way to resolve the case.  He 
noted, however, Kazakhstan's hyper-awareness of its newly-gained 
international stature as OSCE Chair, and strongly cautioned against 
placing conditions on Kazakhstan or demanding Zhovtis immediate 
release.  In his opinion, President Nazarbayev is relatively 
uninformed about this case and the international reaction to it, 
because his inner circle does not want to upset him.  END SUMMARY. 
 
CASE FILED WITH THE SUPREME COURT 
 
2. (C) Vitaliy Voronov, lawyer for human-rights activist Yevgeniy 
Zhovtis, told the CDA that he filed a motion to request the Supreme 
Court review Zhovtis' case on January 27 (reftel).  (NOTE: 
Amendments to the Criminal Procedure Code that went into effect on 
January 1 allow the Supreme Court to review cases of crimes of lesser 
gravity, like the one for which Zhovtis was convicted.  END NOTE.) 
The Supreme Court has one month to decide whether to accept the case 
for review.  If it does, it must issue a decision within another 
month.  Voronov said the Supreme Court usually acts quickly. 
 
CAUTIOUS OPTIMISM 
 
3. (C) In his appeal, Voronov requested the court simply vacate 
Zhovtis' sentence and did not ask it to overturn the guilty verdict, 
as in earlier appeals.  Despite Voronov's cautious optimism that the 
Supreme Court will decide in Zhovtis' favor, he stressed that this 
will be "a political, and not judicial, decision."  The initial 
stages of the Zhovtis case were controlled by "law enforcement and 
security forces, people on the lower levels, who misunderstood and 
miscalculated the political reverberations," he argued.  "Now 
politicians are involved, and the Supreme Court will do what it is 
told." 
 
4. (C) Voronov believes that these "lower elements achieved their 
goals -- they struck fear into the community.  A regular person on 
the street now thinks 'If they can do this to Zhovtis, with his 
international standing, they can do anything to me'.  It has worked 
-- the opposition, NGOs, and regular people are scared," he stressed. 
 In response to the CDA's inquiry about the reasons behind Voronov's 
optimism about the Supreme Court, given his belief that the whole 
case has been politically motivated, Voronov explained, "We have no 
choice, this is the only path left."  Zhovtis' defense team continues 
to consider filing a petition with the UN Human Rights Council 
(UNHRC), he noted, but UNHRC cases require much preparation, and 
their outcomes are protracted .  "My goal is to get Zhenya (Zhovtis) 
out quickly." 
 
WARNING AGAINST CONDITIONS 
 
5. (C) A decision by the Supreme Court to vacate Zhovtis' sentence 
would "be an easy and beautiful solution for Kazakhstan," asserted 
Voronov.  "A message needs to get to the top that this is the best 
solution for them."  However, he strongly cautioned against "ordering 
(President) Nazarbayev to release Zhovtis or putting conditions on 
Kazakhstan.  You are dealing with the Chairman of the OSCE now, the 
government is not afraid of anything," he argued.  Pushing Kazakhstan 
too much could be perceived as interference in internal affairs and 
may backfire -- "Zhovtis would be forced to serve the whole sentence 
just to prove that Kazakhstan is sovereign and independent.  Someone 
needs to suggest to Nazarbayev, gently and privately, that [the 
Supreme Court] option is the best way out, perhaps through [Foreign 
Minister] Saudabayev or [National Security Advisor] Tazhin," opined 
Voronov. 
 
"DO NOT UPSET THE OLD MAN" 
 
6. (C) In Voronov's opinion, President Nazarbayev knows little of the 
Zhovtis case and the international reaction to it.  "He probably only 
 
ASTANA 00000109  002 OF 002 
 
 
knows what was in the MFA's press release -- there was an accident. 
Zhovtis was at fault.  He received a fair sentence.  Justice was 
served."  Voronov believes that people closest to Nazarbayev "do not 
want to upset him.  I've heard some say, 'Why worry the old man?'" 
Voronov alleged that Presidential Advisor Yertysbayev has been trying 
to see Naz
arbayev since July "to tell him how this looks" from the 
international perspective.  (NOTE: Yertysbayev participated in OSCE's 
2009 Human Dimension Implementation Meeting in Warsaw, where the 
Zhovtis case and his less-than-diplomatic behavior received 
significant attention.  END NOTE.)  "He cannot get in, [Chief of 
Presidential Administration] Musin keeps him out," asserted Voronov. 
 
7. (C) COMMENT:  The Supreme Court review presents Kazakhstan an 
easy, face-saving way out -- Zhovtis is freed but remains guilty of 
the crime.  However, as recently as today, the MFA reiterated that 
Zhovtis' treatment has been in strict accordance with Kazakhstani law 
and that Kazakhstanis consider it unfair that the international 
community is singling him out.  Since assuming the OSCE Chairmanship, 
the government has grown increasingly sensitive about criticism of 
its domestic human-rights record and alleged slights to its 
international stature.  Should the Supreme Court vacate the verdict 
as Voronov hopes, the government would be able to achieve its 
political objectives, but save face by saying that it was possible 
because of the actions of its independent judiciary without any 
international interference.  For this reason, we should seriously 
consider Voronov's warning.  END COMMENT. 
 
SPRATLEN

Wikileaks

10ASTANA90, KAZAKHSTAN: PARLIAMENT DISCUSSES REVISIONS TO MARITIME

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Reference ID Created Released Classification Origin
10ASTANA90 2010-01-26 08:31 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO7900
OO RUEHIK
DE RUEHTA #0090/01 0260831
ZNR UUUUU ZZH
O 260831Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7290
INFO RUCNCIS/CIS COLLECTIVE 2409
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1770
RUEHKO/AMEMBASSY TOKYO 2476
RUEHUL/AMEMBASSY SEOUL 1386
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 1966
RUEKJCS/SECDEF WASHDC 1816
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2219

UNCLAS SECTION 01 OF 02 ASTANA 000090 
 
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 SENV SOCI KZ
SUBJECT:  KAZAKHSTAN:  PARLIAMENT DISCUSSES REVISIONS TO MARITIME 
LAW 
 
ASTANA 00000090  001.3 OF 002 
 
 
REFTEL:  09 ASTANA 2255 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (U) SUMMARY:  At a January 21 roundtable hosted by the 
Association of Maritime Transportation Entrepreneurs, 
parliamentarians and representatives of 10 ministries, international 
shipping companies, and the diplomatic community discussed the need 
for significant improvements in Kazakhstan's maritime transportation 
legislation.  National maritime shipping company KazMorTransFlot 
(KMTF) highlighted its competitive disadvantage compared to other 
national shipping companies, which receive direct operational 
support from their governments.  Chevron's maritime transportation 
advisor called for the creation of a single maritime administration 
and a marine academy to meet Kazakhstan's increasing demand for 
clear, consistent regulations and well-trained naval crews that meet 
international standards.  As a result, the parliamentarians asked 
the Ministry of Transportation and Communications to provide 
recommendations on amendments to the 2002 Maritime Transportation 
Law to ensure its full compliance with International Maritime 
Organization (IMO) guidelines.  END SUMMARY. 
 
KMTF AT A COMPETITIVE DISADVANTAGE 
 
3.  (U) KMTF General Director Marat Ormanov compellingly argued his 
company's distinct disadvantage compared to competitors from 
Azerbaijan, Russia, and Iran.  "The competition to ship oil via the 
Caspian Sea is getting tougher," he said.  "The maritime shipping 
companies of Azerbaijan, Russia, and Iran are beefing up their trade 
fleets with government support, and we are at a competitive 
disadvantage."  According to Ormanov, unlike all other Caspian 
fleets, Kazakhstani maritime shipping companies do not receive 
call-in port preferential rates in domestic ports.  He highlighted 
that a KMTF tanker is charged $8,600 more than an Azerbaijani vessel 
of the same type for every call-in at the Baku sea port.  "As a 
result," he claimed, "we overpay $600,000 annually, and lose any 
chance at competitiveness." 
 
OIL TANKER SHIPMENTS EXPECTED TO INCREASE DRAMATICALLY 
 
4.  (U) Ormanov said that KMTF currently owns and operates four oil 
tankers, with two additional 13,000-deadweight ton (dwt) tankers 
expected by the end of the year.  "Meanwhile," he asserted, 
"Azerbaijan has built 10 tankers in the last four years, primarily 
to ship Kazakhstan's oil.  The lion's share of that investment came 
directly from the Azeri government."  Ormanov added that Russia's 
Caspian fleet includes 27 oil tankers (including three new ships), 
Iran has three 63,000 dwt supertankers at various stages of 
construction, and Azerbaijan has a total of 45 vessels, including 10 
new ones.  Alexander Andrushenko, chairman of the Association of 
Maritime Transportation Entrepreneurs, claimed that the percentage 
of Kazakhstan's oil exports shipped by sea will increase from 15% to 
40% by 2020 (NOTE:  During this same period, Kazakhstani oil 
production is expected to double.  END NOTE). 
 
CALL FOR A NEW MARITIME ADMINISTRATION 
 
5.  (U) Ormanov also highlighted the absence of a single, unified 
Kazakhstani maritime administration with the authority and resources 
to guide the development of its nascent maritime transportation 
industry.  Ormanov insisted that this administration must have 
professional staff who can enforce navigation safety, define state 
policy, establish a navigation registry, and manage the registration 
of ships and ship owners.  "Maritime transportation in Kazakhstan is 
governed by many different agencies with many other interests," he 
said, noting the Azerbaijani maritime administration's sole 
authority over maritime transportation and direct line to President 
Aliyev. 
 
LACK OF QUALIFIED CREWS A MAJOR CONCERN 
 
 
ASTANA 00000090  002.3 OF 002 
 
 
6.  (U) Chevron's former Regional Marine Manager, Kjell Landin, now 
a private consultant, strongly agreed.  He reiterated to the members 
of parliament and ministry officials that Kazakhstan should 
establish a single maritime administration with clear rules, a 
strong mandate, skilled staff, and sufficient resources to carry out 
its mission.  Landin also proposed the establishment of a marine 
academy, training center, and apprenticeship programs to pr
ovide 
Kazakhstani mariners for the industry.  He estimated that Kazakhstan 
will need 4,000 qualified mariners, including 1,500 officers, and 
20-40 tankers, including some large vessels (40,000-60,000 dwt) by 
2020.  "Out of 900 mariners presently engaged onboard 
Kazakhstani-flagged vessels, only 19% are citizens of Kazakhstan," 
he highlighted, "while the number of senior officers who are 
citizens is almost zero."  According to Landin, it takes a minimum 
of 15 years to train and certify a ship's captain.  (NOTE:  On 
January 1, Article 25 of the Law on Maritime Shipping came into 
effect, requiring that all crew members on Kazakhstani-flagged 
vessels be Kazakhstani citizens (reftel).  END NOTE). 
 
7.  (U) Visibly impressed, parliamentarian Zeinulla Alshymbayev, a 
member of the transportation working group in the Mazhilis (lower 
house), vowed to incorporate the experts' recommendations into 
legislation currently under discussion.  "I can see that there are 
many things we did not take into account in our draft," he 
acknowledged, such as the registration and flagging of vessels, 
long-term training programs for crews, and establishment of a 
single, unified maritime administration. 
 
8.  (SBU) COMMENT:  If Kazakhstan's oil production increases as 
expected over the next five years, the Kazakhstan Caspian 
Transportation System (KCTS), which entails tanker shipments across 
the Caspian, will play a critical role in bringing the crude to 
market.  The government and international oil companies thus far 
have focused on the ownership of the infrastructure required to 
transport the oil westward.  This roundtable, however, underscored 
the significant need for attention to and investment in the legal 
framework, institutional authority, and human capacity in order for 
Kazakhstan to develop its maritime transportation industry, meet 
international standards, and compete with neighboring states.  END 
COMMENT. 
 
HOAGLAND

Wikileaks

10ASTANA89, KAZAKHSTAN: LOCAL CONTENT LEGISLATION AMENDMENTS NEEDED

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Reference ID Created Released Classification Origin
10ASTANA89 2010-01-26 08:30 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO7892
OO RUEHIK
DE RUEHTA #0089/01 0260830
ZNR UUUUU ZZH
O 260830Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7288
INFO RUCNCIS/CIS COLLECTIVE 2407
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1768
RUEHKO/AMEMBASSY TOKYO 2474
RUEHUL/AMEMBASSY SEOUL 1384
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 1964
RUEKJCS/SECDEF WASHDC 1814
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2217

UNCLAS SECTION 01 OF 02 ASTANA 000089 
 
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 SOCI KZ
SUBJECT:  KAZAKHSTAN:  LOCAL CONTENT LEGISLATION AMENDMENTS NEEDED 
TO KEEP OIL AND GAS PROJECTS ON TRACK 
 
ASTANA 00000089  001.3 OF 002 
 
 
REFTEL:  08 ASTANA 1910 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  On January 20, Energy Officer received a 
thorough overview of the laws and regulations governing subsoil use 
and local content from a well-respected local law firm. 
Negotiations between the government and foreign investors over local 
content likely will continue due to ambiguous language in the law, 
which fails to define a consistent methodology to calculate local 
content.  If unresolved, these negotiations could affect the quality 
and pace of major oil-production projects, such as Kashagan.  END 
SUMMARY. 
 
LEGISLATION REGULATING SUBSOIL USER OPERATIONS 
 
3.  (SBU) On January 20, Energy Officer met with Samat Daumov, 
Director of the Astana Branch of Grata Law Firm and a member of the 
Parliamentary advisory group on the Subsoil Use Law, to discuss 
subsoil use legislation. The discussion included Decree 367 (March 
20, 2009) to establish a unified methodology for local content 
calculation, the Local Content Law 223 (December 29, 2009), and the 
draft Subsoil Use Law, which will replace existing laws.  The Local 
Content Law officially comes into effect on January 22. 
 
AMBIGUOUS METHODOLOGY LEADS TO INDIVIDUAL INTERPRETATIONS 
 
4.  (SBU) Daumov complained that ambiguity with the formula to 
calculate local content has compelled subsoil users to developed 
their own, individual interpretations and estimations.  He asserted 
that the flawed formula resulted from government pressure for rapid 
legislative approval, which precluded parliament's proper 
consideration of the consequences of implementation.  According to 
Daumov, the Ministry of Energy and Mineral Resources (MEMR) is 
awaiting the reaction of subsoil users to the new law, and "will not 
make further amendments unless they raise a fuss." 
 
LOCAL CONTENT LAW STRENGTHENS STATE ROLE 
 
5.  (SBU) Daumov highlighted the Local Content Law's mandated 
creation of a database of local suppliers.  He also explained that 
the law places responsibility for meeting local content requirements 
squarely on the shoulders of the companies and strengthens the 
state's oversight role by giving additional authority to the 
Ministry of Energy and Mineral Resources (MEMR) to monitor local 
content requirements.  According to Daumov, the law requires 
companies to establish a percentage of local content in contracts, 
but does not explain how to address existing contracts without a 
specified percentage.  Daumov confided that in March 2009, following 
approval of Decree 367, MEMR sent letters to subsoil users, which 
recommended they amend contracts to establish a minimum 
local-content provision.  He asserted that small subsoil users 
undertook the relevant changes while larger investors did not. 
 
6.  NOTE:  On January 26, Minister of Energy and Mineral Resources 
Sauat Mynbayev informed parliament that MEMR has introduced changes 
to more than 500 contracts during the past two years, including 
changes designed to increase local content and attract more 
Kazakhstani specialists to oil and gas projects.  Mynbayev 
acknowledged that it has been difficult for MEMR to modify contracts 
for large projects such as Kashagan, but he nevertheless reported 
that the number of Kazakhstani senior managers working on Kashagan 
increased from nine to 241 during the last two years.  "We will 
continue to press this point with the international companies," 
Mynbayev vowed, adding that all new exploration and production 
contracts will contain strict requirements to employ local 
subcontractors and Kazakhstani specialists.  END NOTE. 
 
7.  (SBU) Daumov explained that the Local Content Law allows the 
state to revoke the subsoil-production rights of users who do not 
meet local-content requirements during a project's exploration 
 
ASTANA 00000089  002.3 OF 002 
 
 
phase.  He said that the government, which is aware of Kazakhstan's 
current scarcity of qualified local-specialists and subcontractors, 
has asked international investors to establish consortia to develop 
local content.  Although he acknowledged that the law favors 
domestic suppliers by creating an enabling environment for their 
development, Daumov contended that it does not constitute a direct
 
subsidy. 
 
SUBSOIL USE LAW NEAR FINAL APPROVAL 
 
8.  (SBU) Daumov told Energy Officer that discussion of the draft 
was temporarily halted pending approval of the Local Content Law. 
On January 21, the Parliament concluded debate on the draft Subsoil 
Use Law, which is expected to enter into force in the near future 
(reftel). 
 
U.S. COMPANY CALLS FOR KAZAKHSTAN TO INVEST IN LOCAL CONTENT 
 
9.  (SBU) During a courtesy call with the Ambassador on January 26, 
Dan Houser, Vice President for Europe and Central Asia of J. Ray 
McDermott, told the Ambassador that McDermott was committed to 
investing in local content in Kazakhstan, but he said the government 
cannot continue to rely on international companies to develop local 
skills and capacity.  "Kazakhstan needs to invest in itself more. 
They need to put their money on the table," he said. 
 
10.  (SBU) COMMENT:  Although legislation governing local content 
and subsoil use gradually is taking shape, ambiguities regarding the 
calculation and implementation of local-content requirements present 
an administrative barrier for subsoil-use operations.  Ongoing 
negotiations over what does and does not constitute local content 
could slow the pace of major oil projects, such as Kashagan, unless 
these issues are resolved in a timely manner.  The government has 
previously demonstrated a willingness to consider the suggestions of 
subsoil users when implementing laws of this nature.  We expect that 
further amendments will be necessary, particularly if large 
investors such as Chevron, ExxonMobil, and Conoco press the claim 
that these restrictions will impact the pace and quality of 
operations.  END COMMENT. 
 
 
HOAGLAND

Wikileaks

10ASTANA82, KAZAKHSTAN: APPRECIATION MIXED WITH CONCERN

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Reference ID Created Released Classification Origin
10ASTANA82 2010-01-26 04:06 2011-08-30 01:44 SECRET Embassy Astana

VZCZCXRO7679
OO RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL
DE RUEHTA #0082 0260406
ZNY SSSSS ZZH
O 260406Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7280
INFO RUCNCIS/CIS COLLECTIVE 2406
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUCNAFG/AFGHANISTAN COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1767
RUEHKO/AMEMBASSY TOKYO 2473
RUEHUL/AMEMBASSY SEOUL 1383
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1963
RUEKJCS/SECDEF WASHDC 1813
RUEKJCS/JOINT STAFF WASHDC
RHMFISS/CDR USCENTCOM MACDILL AFB FL
RUCNDT/USMISSION USUN NEW YORK 2692
RUEHNO/USMISSION USNATO 2982
RHMFISS/CDR USTRANSCOM SCOTT AFB IL

S E C R E T ASTANA 000082 
 
SIPDIS 
 
STATE FOR SCA/CEN, S/SRAP, EUR/RUS, PM, DRL 
 
E.O. 12958: 01/20/2030 
TAGS: PGOV PREL PHUM PINR EAID MARR AF RS KZ
SUBJECT:  KAZAKHSTAN:  APPRECIATION MIXED WITH CONCERN 
 
REF:  A.  ASTANA 0020 
  B.  ASTANA 0002 
 
Classified By: Ambassador Richard E. Hoagland:  1.4 (A), (B), (D) 
 
1.  (S) SUMMARY:  During a January 25 meeting, Deputy Foreign 
Minister Kairat Umarov noted the Kazakhstani government's 
appreciation for Assistant Secretary of State for South and Central 
Asian Affairs Robert Blake's recent remarks on Kazakhstan at the 
National Press Club in Washington and Special Representative for 
Afghanistan and Pakistan Richard Holbrooke's civilian strategy for 
Afghanistan.  Umarov also told the Ambassador that the Kazakhstani 
government hopes to have a draft overflight agreement prepared by 
February 1 (ref A).  Umarov asserted the government is considering 
seriously whether or not to refuse all assistance under the 
human-rights certification (ref B).  END SUMMARY. 
 
RECENT POLICY STATEMENTS WELL RECEIVED 
 
2.  (SBU) On January 25, Deputy Foreign Minister Kairat Umarov both 
personally and officially conveyed to the Ambassador appreciation for 
SCA A/S Robert Blake's January 20 remarks on Kazakhstan's 
Chairmanship of the OSCE.  Calling it "helpful to mitigate the AP 
article" and other bilateral irritants, he emphasized that the 
statement pleased the government.  With obvious enthusiasm, Umarov 
also expressed "great interest" in the civilian strategy for 
Afghanistan recently announced by Special Representative Holbrooke. 
He underlined that this increased attention to humanitarian and 
civilian needs "coincides with Kazakhstan's view, especially our 
thinking on the summit.  This is what we were thinking regarding an 
OSCE summit on Afghanistan.  The military is the short-term response, 
while civilian is long-term."  Umarov further stated his hope that 
Presidents Nazarbayev and Obama can discuss these issues during a 
meeting on the sidelines of the April Global Nuclear Security Summit. 
 
DRAFT OVERFLIGHT AGREEMENT SOON 
 
3.  (S) Umarov asserted that he had hoped to present a text of a 
draft overflight agreement before the Ambassador's January 27 trip to 
Washington.  However, he explained, "We are still addressing minor 
details, but we hope to have a copy before the Foreign Minister 
travels to Washington (i.e., February 1)." 
 
SERIOUSLY STUDYING HUMAN RIGHTS CERTIFICATION ASSISTANCE 
 
4.  (SBU) On Kazakhstan's threat to refuse assistance subject to the 
Congressional human-rights certification process, Umarov stated, "We 
are looking more deeply at this step.  I do not like radical steps. 
Before we make an official decision, I will look into the details. 
We do not want to be humiliated to get financial assistance.  We 
would rather reject it outright and be done with it."  The Ambassador 
highlighted the negative consequences to Kazakhstan's image should it 
refuse the assistance.  However, Umarov insisted that the process can 
be "used as a tool to put us in a bad situation." 
 
5.  (SBU) Umarov explained that the Kazakhstani Embassy to the United 
States is considering the pros and cons after which the government 
will have inter-agency meetings to discuss their options.  Umarov 
emphasized, "We do not want certification to be used as leverage 
against us.  We know how small things can become big, big issues, 
such as the AP article [which alleged negotiations between elements 
related to KazAtomProm and Iran for the sale of yellowcake uranium]. 
At some point, someone [in the Kazakhstani government] will raise it 
and ask why we did not eliminate the process."  He asserted that the 
government will take a consolidated approach, using the advice of its 
Embassy and other agencies.  Umarov further argued, "We must not just 
wait and see, but we must work and be proactive.  I am not for 
radical steps, but when issues become troubling, we must do 
something."  The Ambassador responded that such a step would be a 
disaster for the bilateral relationship, with unforeseen negative 
consequences.  He urged that Kazakhstan retain some perspective on 
the situation. 
 
HOAGLAND

Wikileaks

10ASTANA80, KAZAKHSTAN: DEMARCHE RESPONSE ON LONDON CONFERENCE ON

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Reference ID Created Released Classification Origin
10ASTANA80 2010-01-25 10:03 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO6784
OO RUEHIK
DE RUEHTA #0080 0251003
ZNR UUUUU ZZH
O 251003Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7278
INFO RUCNCIS/CIS COLLECTIVE 2405
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1766
RUEHKO/AMEMBASSY TOKYO 2472
RUEHUL/AMEMBASSY SEOUL 1382
RUCNDT/USMISSION USUN NEW YORK 2691
RUEHNO/USMISSION USNATO 2981
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1962
RUEKJCS/SECDEF WASHDC 1812
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS ASTANA 000080 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, S/SRAP (JARRETT BLANC), SCA/A (TOM GRAMAGLIA AND 
CAROLYN COBERLY) 
 
E.O. 12958: N/A 
TAGS: PREL PREF EFIN AF KZ
SUBJECT:  KAZAKHSTAN:  DEMARCHE RESPONSE ON LONDON CONFERENCE ON 
AFGHANISTAN 
 
REF: STATE 6355 
 
1. (U) Sensitive but unclassified.  Not for public Internet. 
 
2. (SBU) On January 25, the Ambassador delivered reftel points to 
Deputy Foreign Minister Kairat Umarov.  Umarov took the points under 
advisement.  Post also forwarded the points to the MFA separately 
under the cover of a diplomatic note.  Post will report any 
substantive response. 
 
SPRATLEN

Wikileaks

10ASTANA79, KAZAKHSTAN: DEMARCHE RESPONSE ON THE NUCLEAR SECURITY

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Reference ID Created Released Classification Origin
10ASTANA79 2010-01-25 10:03 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO6782
OO RUEHIK
DE RUEHTA #0079 0251003
ZNR UUUUU ZZH
O 251003Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7277
INFO RUCNCIS/CIS COLLECTIVE 2404
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1765
RUEHKO/AMEMBASSY TOKYO 2471
RUEHUL/AMEMBASSY SEOUL 1381
RUCNDT/USMISSION USUN NEW YORK 2690
RUEHNO/USMISSION USNATO 2980
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1961
RUEKJCS/SECDEF WASHDC 1811
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS ASTANA 000079 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, ISN 
 
E.O. 12958: N/A 
TAGS: PARM EAID TBIO IAEA NPT PREL KZ
SUBJECT:  KAZAKHSTAN:  DEMARCHE RESPONSE ON THE NUCLEAR SECURITY 
SUMMIT 
 
REF: STATE 5891 
 
1. (U) Sensitive but unclassified.  Not for public Internet. 
 
2. (SBU) On January 25, the Ambassador delivered reftel points to 
Deputy Foreign Minister Kairat Umarov.  Umarov took the points under 
advisement.  Post also forwarded the points to the MFA separately 
under the cover of a diplomatic note.  Post will report any 
substantive response. 
 
SPRATLEN

Wikileaks

10ASTANA78, KAZAKHSTAN: DEMARCHE RESPONSE ON U.S. ASSISTANCE TO

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Reference ID Created Released Classification Origin
10ASTANA78 2010-01-25 10:03 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO6780
OO RUEHIK
DE RUEHTA #0078 0251003
ZNR UUUUU ZZH
O 251003Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7276
INFO RUCNCIS/CIS COLLECTIVE 2403
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1764
RUEHKO/AMEMBASSY TOKYO 2470
RUEHUL/AMEMBASSY SEOUL 1380
RUCNDT/USMISSION USUN NEW YORK 2689
RUEHNO/USMISSION USNATO 2979
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1960
RUEKJCS/SECDEF WASHDC 1810
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS ASTANA 000078 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, HAITI EARTHQUAKE TASKFORCE, WHA/CAR (V DE PIRRO), 
IO/UNP (B NARANJO AND N GARUCKIS) 
 
E.O. 12958: N/A 
TAGS: PREL PREF EAID ECON HA KZ
SUBJECT:  KAZAKHSTAN:  DEMARCHE RESPONSE ON U.S. ASSISTANCE TO 
HAITI 
 
REF: STATE 6918 
 
1. (U) Sensitive but unclassified.  Not for public Internet. 
 
2. (SBU) On January 25, the Ambassador delivered reftel points to 
Deputy Foreign Minister Kairat Umarov.  Umarov took our points under 
advisement.  Post also forwarded the points to the MFA separately 
under the cover of a diplomatic note.  Post will report any 
substantive response. 
 
SPRATLEN

Wikileaks

10ASTANA74, KAZAKHSTAN: CHINA PRAISES ASTANA’S FOREIGN POLICY, WORRIES

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Reference ID Created Released Classification Origin
10ASTANA74 2010-01-25 09:22 2011-08-30 01:44 SECRET//NOFORN Embassy Astana

VZCZCXRO6750
OO RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL
DE RUEHTA #0074/01 0250922
ZNY SSSSS ZZH
O 250922Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7269
INFO RUCNCIS/CIS COLLECTIVE 2400
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHKO/AMEMBASSY TOKYO 2467
RUEHBJ/AMEMBASSY BEIJING 1761
RUEHUL/AMEMBASSY SEOUL 1377
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1957
RUEKJCS/SECDEF WASHDC 1807
RHMFISS/CDR USCENTCOM MACDILL AFB FL
RUEKJCS/JOINT STAFF WASHDC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCNDT/USMISSION USUN NEW YORK 2686
RUEHNO/USMISSION USNATO 2976

S E C R E T SECTION 01 OF 03 ASTANA 000074 
 
NOFORN 
SIPDIS 
 
STATE FOR SCA/CEN, EAP/CM, EUR/RUS 
 
E.O. 12958; DECL: 01/25/2025 
TAGS: PGOV PREL PINR EPET ECON NATO CH RU UZ KZ
SUBJECT:  KAZAKHSTAN:  CHINA PRAISES ASTANA'S FOREIGN POLICY, WORRIES 
ABOUT RUSSIA 
 
REF:  A.  08 ASTANA 0812 
      B.  09 ASTANA 2168 
 
Classified By: Ambassador Richard E. Hoagland, 1.4 (A), (B), (D). 
 
1.  (S/NF) SUMMARY:  In his farewell courtesy call with the 
Ambassador on January 22, China's Ambassador to Kazakhstan Cheng 
Guoping (please protect) highly praised Kazakhstan's skillful 
balancing of the "great powers."  Repeatedly emphasizing the personal 
nature of the conversation, Cheng highlighted his view that China and 
Russia must "coexist" in Central Asia.  He expressed a positive view 
of the U.S. role in the region, but cautioned against a permanent 
military presence.  Cheng recommended that the United States urge 
Uzbekistan to invite NATO "as a guest" to attend the June summit in 
Tashkent of the Shanghai Cooperation Organization (SCO) in order to 
increase NATO-SCO cooperation.  Cheng departs Astana February 2 to 
return to Beijing to become Deputy Foreign Minister for Eurasia (the 
CIS).  We suspect Embassy Beijing will find him to be an interesting 
but reserved interlocutor.  END SUMMARY. 
 
FUTURE DEPUTY FOREIGN MINISTER 
 
2.  (S) Arriving in the Ambassador's office with a large gift bag of 
green tea "for the Ambassador's health," China's Ambassador to 
Kazakhstan Cheng Guoping (please protect) stressed his interest in 
maintaining close contact with the Ambassador after he returns to 
China February 2 to become Deputy Foreign Minister in charge of 
Eurasia (i.e., countries of the Commonwealth of Independent States). 
Among the key issues that he will handle, he mentioned relations with 
Russia, the SCO, and Kazakhstan.  Cheng argued, "Kazakhstan's role 
and importance is growing daily and is of great significance to China 
for political, economic, and security reasons."  He underlined the 
need to develop mutual trust in order to enhance Chinese influence in 
the region, especially because of the area's effect on China's 
security. 
 
SOPHISTICATED, SMART FOREIGN POLICY 
 
3.  (S) Cheng strongly agreed with the Kazakhstani Foreign Ministry's 
portrayal of Kazakhstan as a bridge between East and West, the OSCE 
and the SCO.  He emphasized the sophistication of Kazakhstan's 
foreign policy of balancing Russia, the United States, European 
Union, and China.  Highlighting Kazakhstan's membership in the 
Commonwealth Security Treaty Organization, the Eurasian Economic 
Community, and the Russia-Belarus-Kazakhstan Customs Union, Cheng 
stated that Kazakhstan still "attaches great importance to relations 
with the United States, China, and the European Union." 
 
4.  (S) Asserting that Kazakhstan is not a pro-Russian country, Cheng 
called its foreign policy "smart and successful, because good 
relations with China, the European Union, and the United States 
increase his (i.e., President Nazarbayev's) influence when he engages 
with Russia.  All countries in the region want to maintain their 
independence, but Russia wants to regain its regional influence.  CIS 
countries need Russian cooperation and good relations, but they all 
suspect Russia's intentions.  No CIS country wants to return to the 
Soviet period."  Comparing the current situations in Ukraine, 
Georgia, and Azerbaijan, Cheng again called Kazakhstan "smart" for 
cooperating with Russia as well as the United States, European Union, 
and China.  Cheng further argued that Kazakhstan's growing economy 
and influence allow it to resist Russian control. 
 
"CHINA MUST COOPERATE HERE" 
 
5.  (S) Elaborating on China's role in Central Asia, Cheng said, "The 
new oil and gas pipelines are breaking Russia's monopoly in energy 
exports and are decreasing the countries' dependence on Russia. 
Because Russia wants to maintain a monopoly on oil and gas exports in 
Central Asia, it dislikes the China-Kazakhstan pipeline (refs A-B)." 
According to Cheng, as China increases its regional "cooperation," 
the Russian Foreign Ministry wants to maintain close contact to 
 
ASTANA 00000074  002 OF 003 
 
 
ensure that it does not "harm Russia's core interests."  Cheng 
emphatically declared, "China must cooperate here.  The growth of 
Chinese influence will break the Russian monopoly in the region." 
 
COMPE
TITION AND COLLABORATION WITH RUSSIA 
 
6.  (S) Reflecting on his upcoming responsibilities, Cheng stated, "I 
will have to balance carefully increasing our cooperation with 
Central Asia with Russian interests.  However, we cannot harm our own 
interests because of Russia.  Competition and collaboration coexist 
in Chinese-Russian relations in Central Asia.  Our policy is to 
coexist here.  We must maintain a dialogue and consultations."  Cheng 
asserted that Russia and China can work together on security issues, 
such as terrorism and narcotics, to the benefit of all.  On the 
economic front, though, Cheng underlined their rivalry, and again 
asserted that Russia's reaction will not force it to limit its 
regional cooperation.  "In the future, great power relations in 
Central Asia will be complicated, delicate.  Kazakhstan is very 
smart, aware of the opportunities and that it must maintain a 
balance," he concluded. 
 
SUPPORT FOR U.S. REGIONAL ROLE 
 
7.  (S) In contrast to his unease with Russian influence, Cheng 
argued that the U.S. presence in the region promotes a "balance of 
the great powers."  Cheng emphasized China's support for U.S. efforts 
to fight the Taliban and terrorists, calling them a common challenge. 
 Nonetheless, he cautioned, "We have concerns if the United States 
uses the opportunity of fighting terrorists to enhance its military 
presence in the region."  The Ambassador reassured Cheng that the 
United States does not want a permanent military presence or bases in 
Central Asia.  Given President Obama's focus on Afghanistan and troop 
increases, he explained, Manas Transit Center -- and potentially 
other commercial transit centers for goods -- is very important. 
 
"KARIMOV NEEDS POLITICAL SUPPORT" 
 
8.  (S/NF) Cheng confided that he had "information" about the 
possibility of a new U.S. military transit center in Uzbekistan and 
called it a "delicate point."  Cheng expressed his belief that 
Karimov will agree to the proposal because "he needs political 
support and assistance from other countries due to Uzbekistan's 
difficulties, poor relations with Russia.  He is using the flag of 
anti-terrorism efforts to decrease criticism of his regime." 
 
NATO-SCO COOPERATION POSSIBLE 
 
9.  (S/NF) Replying to Cheng's assertion that "stabilization and 
reconstruction in Afghanistan will take a long time," the Ambassador 
asked if NATO-SCO consultations might be helpful.  Cheng highlighted 
the absence of an established NATO-SCO dialogue before expressing his 
personal viewpoint.  "If NATO wants to establish contact with the 
SCO, the host of the June 23 SCO Summit [Uzbekistan] can invite NATO 
to attend as a guest, which would increase understanding and 
cooperation."  He further suggested, as a first step, the United 
States recommend that NATO attend the meeting because of the event's 
anti-terrorism "content."  He argued, "The United States can attend 
the June 23 summit being hosted by Tashkent as Uzbekistan's guest in 
order to increase contact." 
 
10.  (S/NF) Again emphasizing the personal nature of this 
not-for-attribution advice, Cheng stated, "Russia supports it as far 
as I know.  China has not researched the issue, but Russia has ideas 
because of Afghanistan.  If the United States advances the 
suggestion, the Chinese government will actively consider it.  The 
United States must apply to Uzbekistan as the summit's host country. 
The Chinese government will be cautious, but agreement from Russia, 
Kazakhstan, and Uzbekistan would be good for the proposal.  The 
United States could attend as a guest of the host country." 
 
NO DIRECT CHINESE INVOLVEMENT IN AFGHANISTAN 
 
ASTANA 00000074  003 OF 003 
 
 
 
11.  (S) Cheng argued that the United States should attend the summit 
to "maintain stability and fight the Taliban and terrorists in 
Central Asia."  Cheng underlined the importance China attaches to 
Afghanistan and the defeat of the Taliban.  He also emphasized 
Chinese fear of the Taliban and Al-Qaida due to their "support of 
terrorists in Xinjiang."  Nonetheless, he asserted that China does 
not want "direct involvement in the fight because China's capacity to 
fight terrorists is less than the United States." 
 
CHINESE MEASURES TO SECURE THE PIPELINE 
 
12.  (S) Emphasizing China's large population, Cheng called 
preservation of security a big task, for which the Chinese capacity 
does not match that of the United States.  He especially underlined 
China's vulnerability to attacks on shipping and pipelines, which 
would strike at the heart of the Chinese economy.  According to 
Cheng, Chinese "measures" to secure the pipeline have included 
consultations between the "security departments" of China, 
Kazakhstan, Uzbekistan, and Turkmenistan.  He told the Ambassador 
that China has helped to train security personnel and provide 
equipment and weapons.  He said that China annually supplies 
materials to Kazakhstan's Ministry of Interior and National Security 
Committee (KNB). 
 
PERSONAL, NOT OFFICIAL, CONVERSATION 
 
13.  (S) Concluding this meeting that took place in the Ambassador's 
officer, Cheng again requested that the Ambassador not quote him.  He 
underlined his concern about dissemination of his personal 
reflections, which he said he conveyed due to his strong personal 
relationship with the Ambassador. 
 
BIOGRAPHIC NOTES 
 
14.  (S) Cheng Guoping departs Astana on February 2 for his new 
assignment as Chinese Deputy Foreign Minister in charge of CIS 
countries.  He said he might travel to the United States on 
consultations.  In addition, he plans to visit the United States upon 
retirement.  His daughter currently studies at the University of 
Iowa. 
 
15.  (S) This was the fourth time the Ambassador received Cheng in 
his office, where Cheng preferred to meet because, he has told the 
Ambassador, he does not feel comfortable speaking freely in his own 
office.  Even so, Chen exhibits maximum caution, whispering his 
comments in Mandarin (he does not speak English or Russian) to his 
interpreter.  We suspect that Embassy Beijing will find him to be an 
interesting but reserved interlocutor. 
 
16.  (S) COMMENT:  Fear about China regularly appears in 
conversations and the press in Kazakhstan.  Some Kazakhstanis worry 
about Chinese control of natural resources and proposals to lease 
agricultural land.  Because Kazakhstanis are attuned to their 
geography as a resource-rich country with vast swaths of uninhabited 
land bordering the world's most populous nation, they convey anxiety 
that the Chinese will arrive "like ants to colonize."  Cheng's 
portrayal of Chinese concerns about Kazakhstan's other large neighbor 
gives another perspective to the power game, which Kazakhstan so 
adeptly plays.  END COMMENT. 
 
HOAGLAND

Wikileak
s

10ASTANA73, KAZAKHSTAN: POC FOR STAFFDEL HELWIG

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Reference ID Created Released Classification Origin
10ASTANA73 2010-01-25 09:01 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO6737
OO RUEHAST RUEHBI RUEHCI RUEHDBU RUEHLH RUEHLN RUEHNEH RUEHPW RUEHSK
RUEHVK RUEHYG
DE RUEHTA #0073 0250901
ZNR UUUUU ZZH
O 250901Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7268
INFO RUCNCIS/CIS COLLECTIVE 2399
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHAST/AMCONSUL ALMATY 2215

UNCLAS ASTANA 000073 
 
SENSITIVE 
SIPDIS 
 
STATE FOR H, SCA/CEN 
 
E.O. 12958: N/A 
TAGS: OREP AMGT KZ
SUBJECT:  KAZAKHSTAN:  POC FOR STAFFDEL HELWIG 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) Embassy Astana's point of contact for Staffdel Helwig's 
March 2-10 trip to Kazakhstan is political officer Anna Radivilova. 
Her contact information is as follows: 
 
Name: Anna Radivilova 
Office phone: +7-7172-70-2397 
Cell phone: +7-777-220-9369 
Home phone: +7-7172-35-9033 
Fax: +7-7172-70-2277 
Unclass email: RadivilovaA@state.gov 
 
HOAGLAND

Wikileaks

10ASTANA72, KAZAKHSTAN: MONEY AND POWER

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Reference ID Created Released Classification Origin
10ASTANA72 2010-01-25 08:14 2011-08-30 01:44 SECRET Embassy Astana

VZCZCXRO6688
PP RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL
DE RUEHTA #0072/01 0250814
ZNY SSSSS ZZH
P 250814Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 7265
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY
RUCNCIS/CIS COLLECTIVE PRIORITY 2396
RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUEHBJ/AMEMBASSY BEIJING PRIORITY 1758
RUEHUL/AMEMBASSY SEOUL PRIORITY 1374
RUEHKO/AMEMBASSY TOKYO PRIORITY 2464
RUEAWJA/DEPT OF JUSTICE WASHDC PRIORITY
RHMFISS/CDR USCENTCOM MACDILL AFB FL PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RHMFISS/DEPT OF ENERGY WASHINGTON DC PRIORITY
RHEFAAA/DIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY 1954
RUEKJCS/SECDEF WASHDC PRIORITY 1804
RUEHNO/USMISSION USNATO PRIORITY 2973
RUCNDT/USMISSION USUN NEW YORK PRIORITY 2683

S E C R E T SECTION 01 OF 03 ASTANA 000072 
  
 SIPDIS 
  
 STATE FOR SCA/CEN, EEB 
  
 E.O. 12958: DECL: 01/25/2030 
 TAGS: PGOV PINR EPET EINV KCOR RS CH KZ
 SUBJECT: KAZAKHSTAN:  MONEY AND POWER 
  
 REF: ASTANA 0061 
  
 Classified By: Ambassador Richard E. Hoagland:  1.4 (b), (d) 
  
 1.  (S) SUMMARY:  During a private dinner, KazMunaiGaz First 
 Vice President Maksat Idenov named, in his view, the four 
 most powerful gate-keepers around President Nursultan 
 Nazarbayev:  Chief of Administration and General Services of 
 the President's Office Sarybai Kalmurzayev, the President's 
 Chief of Staff Aslan Musin, State Secretary-Foreign Minister 
 Kanat Saudabayev, and the tandem of Prime Minister Karim 
 Masimov and Nazarbayev's billionaire son-in-law Timur 
 Kulibayev.  According to Idenov, in Kazakhstan, market 
 economy means capitalism, which means big money, which means 
 large bribes for the best connected.  The following details 
 are a single snapshot of one version of current reality.  The 
 significant point is that Nazarbayev is standing with Idenov, 
 not Kulibayev, to maintain international standards to develop 
 the massive Kashagan and Karachaganak hydrocarbon projects. 
 END SUMMARY. 
  
 2.  (S) On January 21, KazMunaiGaz First Vice President 
 Maksat Idenov and the Ambassador had a one-on-one dinner in a 
 nearly empty restaurant (times are still hard!) at the 
 Radisson hotel in Astana.  When the Ambassador arrived, 
 Idenov was barking into his cell phone, "Mark, Mark, stop the 
 excuses!  Mark, listen to me!  Mark, shut up right now and do 
 as I say!  Bring the letter to my office at 10:00 pm, and we 
 will go together to take it to (Minister of Energy and 
 Mineral Resources, MEMR) Mynbayev at his house."  On ending 
 the call, Idenov explained he was talking to British Gas (BG) 
 Country Director for Kazakhstan Mark Rawlings who had missed 
 the deadline to deliver a letter about arbitration on the 
 Karachaganak super-giant oil-field project (reftel).  Still 
 clearly steamed, Idenov alleged, "He's still playing games 
 with Mercator's James Giffin," the notorious AmCit fixer 
 indicted for large-scale bribery on oil deals in the 1990s, 
 whose case drags on in the Southern District Court of New 
 York.  "I tell him, 'Mark, stop being an idiot!  Stop 
 tempting fate!  Stop communicating with an indicted 
 criminal!'"  Idenov asked, "Do you know how much he 
 (Rawlings) makes?  $72,000 a month!  A month!!  Plus 
 benefits!  Plus bonuses!  Lives in Switzerland but supposedly 
 works in London.  Comes here once a month to check in.  Nice 
 life, huh?" 
  
 3.  (S) Idenov calmed down and said, "Let's look at the 
 menus."  Then he immediately started typing on his PDA and 
 turned the screen toward the Ambassador, saying, "Let's look 
 at the 'four courses.'"  On the screen were four names: 
 Kalmurzayev, Musin, Saudabayev, and Masimov-Kulibayev." 
 Idenov said, "The Big Four around Number One."  (NOTE: 
 Sarybai Kalmurzayev, currently the head of Administration and 
 General Services in the Presidential Administration, was, 
 among other jobs, a former head of the Financial Police and, 
 before that, in the 1990s, in charge of privatization.  Aslan 
 Musin is the current Chief of Staff for Nazarbayev.  Kanat 
 Saudabayev, a personal friend of Nazarbayev for nearly 40 
 years, is Minister of State and Foreign Minister.  Karim 
 Masimov is Prime Minister, and Timur Kulibayev is currently 
 the favored presidential son-in-law, on the Forbes 500 list 
 of billionaires (as is his wife separately), and the ultimate 
 controller of 90% of the economy of Kazakhstan.  END NOTE.) 
 In response to a question, Idenov said that Masimov has a 
 degree of freedom, but never acts without permission from 
 "the hyphen" (Kulibayev).  Then Idenov stood up abruptly and 
 carried his PDA to a ledge about 20 feet from the table and 
 asked the Ambassador to turn off his cell phone. 
  
 4.  (S) Idenov said he wanted to explain why he has been less 
 visible for at least the last half year.  Starting last 
 spring, all the "Big Four" (on the menu) began blocking him 
 from seeing President Nazarbayev.  In October, KMG President 
  
 ASTANA 00000072  002 OF 003 
  
  
 Kairgeldy Kabyldin told Idenov, "Kulibayev doesn't want to 
 work with you any more."  Idenov said he replied, "Fine," 
 immediately returned to his office, wrote his letter of 
 resignation, and packed up his personal files and photos
 of 
 his family."  He said Mynbayev immediately called and asked, 
 "My dear friend, what are you doing?!"  Idenov said he was 
 fed up and was going to the Middle East to work -- "I want 
 out of here!"  PM Masimov called and said, "Nazarbayev wants 
 to know how you're doing.  He'd really like to see you when 
 you have time."  Idenov, who said he'd been trying to see the 
 President for months but had been blocked by the "Big Four," 
 went to see the President and told him, "Kabyldin says 
 Kulibayev doesn't want to work with me any more."  Idenov 
 said the President told him to calm down:  "It's probably 
 just evil gossip.  I'll have Karim (Masimov) talk to Timur 
 (Kulibayev).  Then Idenov went to Masimov and told him, "OK, 
 I'll stay, but how do I deal with this?"  Masimov said he'd 
 talk to both Kabyldin and Kulibayev. 
  
 5.  (S) Soon, intermediaries arranged an Idenov-Kulibayev 
 meeting.  Idenov said they both pretended to ignore the core 
 problem -- Kulibayev's, he alleged, avarice for large bribes. 
  Idenov averred he told Kulibayev, "Please watch your image 
 and reputation.  You have a real opportunity to improve your 
 own image and the image of the nation."  Idenov said 
 Kulibayev was "like a Buddha with a Paris manicure," and both 
 understood life would continue.  Idenov said he believes he 
 has, so far, the president's protection.  "But the games 
 continue," he said.  Idenov alleged that both BG and Italy's 
 ENI are corrupt -- and Kulibayev is salivating to profit from 
 them -- but, so far, Idenov stands in the way.  "So long as 
 Nazarbayev says he wants Kashagan and Karachaganak developed 
 according to international standards, that's what I'll do." 
  
 6.  (SBU) (NOTE:  Fugitive former CEO of BTA bank, Mukhtar 
 Ablyazov, accused of embezzling over $1 billion, recently 
 leaked "documentary evidence" to the international media that 
 China's state companies have bribed Kulibayev over $100 
 million in recent months for oil deals.  END NOTE.) 
  
 7.  (S) The Ambassador asked if the corruption and infighting 
 are worse now than before.  Idenov paused, thought, and then 
 replied, "No, not really.  It's business as usual."  Idenov 
 brushed off a question if the current maneuverings are part 
 of a succession struggle.  "Of course not.  It's too early 
 for that.  As it's always been, it's about big money. 
 Capitalism -- you call it market economy -- means huge money. 
  Listen, almost everyone at the top is confused.  They're 
 confused by their Soviet mentality.  They're confused by the 
 corrupt excesses of capitalism.  'If Goldman Sachs executives 
 can make $50 million a year and then run America's economy in 
 Washington, what's so different about what we do?' they ask." 
  
 OTHER TIDBITS 
  
 8.  (S) MODEST WEALTH.  Idenov alleged that MEMR's Mynbayev 
 is among the richest in Kazakhstan but "flies under the 
 radar" because he is a relatively modest and very 
 hard-working technocrat.  His great wealth derives, in part, 
 from his former ownership of KazKommerzBank -- "But he never 
 flaunts it." 
  
 9.  (S) VULTURES.  Idenov alleged that GazProm and China 
 National Petroleum Company "continue to circle like 
 vultures," hoping that the Kashagan and Karachaganak 
 consortia will implode, and then they can pick up the pieces. 
  "Won't happen on my watch!" Idenov vowed. 
  
 10.  (C) HOW TO ORDER LAMB.  Idenov insisted the Ambassador 
 order a bottle of wine for their dinner but then never 
 touched his first glass.  Instead, he gulped three cans of 
 Coca-Cola while inhaling his food.  When both he and the 
 Ambassador ordered lamb chops, Idenov advised, "Well done, 
  
 ASTANA 00000072  003 OF 003 
  
  
 never rare -- this is Astana, not London!" 
  
 11.  (S) COMMENT:  Idenov is effusive, even theatrical, by 
 nature.  When he trusts, he spills his heart.  Of course, 
 there's no doubt he also spins his own narrative, as we all 
 do.  And so, this dinner is simply a snapshot -- but, we 
 would judge, a relatively accurate glimpse of one version of 
 current reality.  The significant point is that Nazarbayev is 
 standing with Idenov, not Kulibayev, to maintain 
 international standards to develop the massive Kashagan and 
 Karachaganak hydrocarbon projects.  END COMMENT. 
 HOAGLAND

Wikileaks

10ASTANA70, KAZAKHSTAN: DEMARCHE ON DISTRACTED DRIVING

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Reference ID Created Released Classification Origin
10ASTANA70 2010-01-25 07:02 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO6644
OO RUEHIK
DE RUEHTA #0070 0250702
ZNR UUUUU ZZH
O 250702Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7263
INFO RUCNCIS/CIS COLLECTIVE 2395
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1757
RUEHKO/AMEMBASSY TOKYO 2463
RUEHUL/AMEMBASSY SEOUL 1373
RUCNDT/USMISSION USUN NEW YORK 2682
RUEHNO/USMISSION USNATO 2972
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1953
RUEKJCS/SECDEF WASHDC 1803
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHVEN/USMISSION USOSCE 2072

UNCLAS ASTANA 000070 
 
SIPDIS 
 
STATE FOR SCA/CEN, OES, OES/S 
STATE PASS TO DEPT OF TRANSPORTATION, NHTSA:JMICHAELS 
 
E.O. 12958: N/A 
TAGS: ECON SOCI UNDP UNGA EU KZ
SUBJECT:  KAZAKHSTAN:  DEMARCHE ON DISTRACTED DRIVING 
 
REFTEL:  STATE 06703 
 
1.  (U) Per reftel, Emboff delivered the demarche on distracted 
driving on January 25 by diplomatic note to the Ministry of Foreign 
Affairs (MFA) Americas Department and provided a non-paper 
containing the key issues of concern.  Post will follow up in order 
to obtain a reply. 
 
HOAGLAND

Wikileaks

10ASTANA69, KAZAKHSTAN: HOW THE OTHER HALF LIVES

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Reference ID Created Released Classification Origin
10ASTANA69 2010-01-25 06:49 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO6637
PP RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL RUEHSR
DE RUEHTA #0069 0250649
ZNY CCCCC ZZH
P 250649Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 7262
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY
RUCNCIS/CIS COLLECTIVE PRIORITY 2394
RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUEHBJ/AMEMBASSY BEIJING PRIORITY 1756
RUEHUL/AMEMBASSY SEOUL PRIORITY 1372
RUEHKO/AMEMBASSY TOKYO PRIORITY 2462
RHMFISS/CDR USCENTCOM MACDILL AFB FL PRIORITY
RHMFISS/CDR USTRANSCOM SCOTT AFB IL PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RHEFAAA/DIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY 1952
RUEKJCS/SECDEF WASHDC PRIORITY 1802
RUEHNO/USMISSION USNATO PRIORITY 2971
RUCNDT/USMISSION USUN NEW YORK PRIORITY 2681

C O N F I D E N T I A L ASTANA 000069 
 
SIPDIS 
 
STATE FOR SCA/CEN 
 
E.O. 12958: DECL: 01/25/2030 
TAGS: PINR SOCI KZ
SUBJECT:  KAZAKHSTAN:  HOW THE OTHER HALF LIVES 
 
Classified By: Ambassador Richard E. Hoagland:  1.4 (b), (d) 
 
1.  (C)  SUMMARY:  Nurlan Kapparov, one of the leading 
entrepreneurs in Kazakhstan, is the founder and CEO of 
Lancaster Holding.  Coming from a traditional Kazakh 
political family, he commissioned a biography of his 
forbearers, one of whom was the vizier for the Khan of 
Khokhand.  His grandfather was an early-Soviet mayor of 
Shymkent.  The following is a slice of life to illustrate how 
the Westernized wealthy currently live in Kazakhstan.  END 
SUMMARY. 
 
2.  (C) Leading entrepreneur Nurlan Kapparov hosted a private 
dinner in his new apartment in Almaty on January 23. 
"Apartment" is a misnomer when it's a 7,000 square-foot 
duplex with it's own movie theater.  Located in the 
ultra-secure gate-house section of the exclusive community 
being built around the golf course, the apartment looks out 
across the fairways with an unimpeded view to President 
Nazarbayev's Almaty Residence 1,500 feet away.  The 
apartment's decor is avant-garde minimalist, ultra-modern 
Euro-style, except for the extensive contemporary Kazakhstani 
art collection and Kapparov's three-room home-office suite 
paneled in ebonized oak and featuring a spotlit 18th-century 
ormolu French desk. 
 
3.  (C) Mrs. Kapparov, pencil-thin and wearing a French 
couture dress, is a businesswoman in her own right, a buyer 
for the most exclusive European designer boutiques in Almaty, 
and a personal fashion adviser for the wealthy.  "Gohar 
dresses the most exclusive women in Kazakhstan," one of the 
spouses whispered approvingly.  Kapparov told his guests with 
affectionate pride his wife had just returned from Italy 
where she'd had a private business lunch with Dolce and 
Gabbana -- themselves.  She laughed that a year ago they 
"wouldn't have touched a simple Kazakh girl like me, but now 
they need all the business they can get." 
 
4.  (C) The guests, all alumni of Harvard's Kennedy School, 
included Vice Minister of Industry and Trade (as well as WTO 
and Russia-Belarus-Kazakhstan Customs Union negotiator) 
Zhanar Aitzhanova (and her enigmatic older spouse, Marat), 
the India-born CEO of the alternative energy firm Kapparov 
founded that plans to build in 2011 a $400M state-of-the-art 
solar-panel factory in Astana employing German technology, 
the First Vice President of the Kazakhstan branch of HSBC, 
and Kapparov's niece who was back on vacation from a major 
bank in Tokyo.  Kapparov's 10-year-old son, Nursultan, sat at 
the table during the entire three-hour dinner, bored but 
perfectly behaved.  Kapparov said that when his son was born, 
he carried the infant to President Nazarbayev and asked 
permission to make him the President's namesake. 
 
5.  (C) The only alcohol of the evening was modest amounts of 
first-class French wine.  The dinner, served family style, 
was a table-covering spread of superb Indian cuisine prepared 
by the Kapparov's personal chef, an ethnic Russian (Kapparov 
introduced her to his guests) who previously had been the 
chef for the European Union Mission before it moved from 
Almaty to Astana. 
 
6.  (C) The dinner-table conversation was not in any way 
nouveaux-riches pretentious.  It revealed no government or 
business gossip.  Rather, it was comfortable friends 
reminiscing about the coffee shops around Harvard Yard, 
discussing books, and comparing the status of their personal 
stages of life.  Aitzhanova, in a sequined black cashmere 
suit, declared she's fed up, worn out, and ready for 
something else.  Kapparov gestured about the table and said 
gently, "When you're ready, we're ready." 
HOAGLAND

Wikileaks

10ASTANA68, KAZAKHSTAN: VIGNETTES OF PUBLIC OPINION: RBK

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Reference ID Created Released Classification Origin
10ASTANA68 2010-01-25 06:49 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO6635
OO RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL RUEHSR
DE RUEHTA #0068 0250649
ZNY CCCCC ZZH
O 250649Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7261
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY
RUCNCIS/CIS COLLECTIVE PRIORITY 2393
RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUEHBJ/AMEMBASSY BEIJING PRIORITY 1755
RUEHUL/AMEMBASSY SEOUL PRIORITY 1371
RUEHKO/AMEMBASSY TOKYO PRIORITY 2461
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RUEATRS/DEPT OF TREASURY WASHINGTON DC PRIORITY
RHEFAAA/DIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY 1951
RUEKJCS/SECDEF WASHDC PRIORITY 1801
RUEHNO/USMISSION USNATO PRIORITY 2970
RUCNDT/USMISSION USUN NEW YORK PRIORITY 2680

C O N F I D E N T I A L ASTANA 000068 
 
SIPDIS 
 
STATE FOR SCA/CEN, SCA/PPD, EUR/ACE, EEB, DRL 
 
E.O. 12958: DECL: 01/25/2020 
TAGS: PREL PHUM ECON ETRD EAID KPAO WTO RS KZ
SUBJECT:  KAZAKHSTAN:  VIGNETTES OF PUBLIC OPINION:  RBK 
CUSTOMS UNION, U.S. ASSISTANCE 
 
Classified By: Ambassador Richard E. Hoagland:  1.4 (b), (d) 
 
1.  (SBU) INTRODUCTION:  On January 23 in Almaty, the 
Ambassador was the key-note speaker at the founding session 
of Kazakhstan's chapter of the Young Presidents Organization 
(YPO), an international group for CEOs of mid-level (or 
larger) companies who must meet stringent international 
standards of transparent business practices.  Seventeen 
self-made CEOs participated, at least half already well-known 
to the Mission.  YPO operates according Chatham House rules 
and encourages frank and open discussion.  During the 
six-hour event, we heard several interesting points of view 
about the Russia-Belarus-Kazakhstan Customs Union, and about 
U.S. government assistance to Kazakhstan.  END INTRODUCTION. 
 
RUSSIA-BELARUS-KAZAKHSTAN CUSTOMS UNION (RBK-CU) 
 
2.  (C) One CEO of a major freight-transfer company reported 
that in the final quarter of 2009, transportation and 
customs-clearance companies recorded a surge in imports. 
However, since January 1, this has not shown up "on the 
shelves."  In fact, in a number of sectors, shortages of 
retail goods appear to be increasing.  The CEO said this 
suggests strongly that retailers are waiting to charge the 
increased RBK-CU tariffs, which could lead to significant 
inflation.  For example, last year a Toyota Land Cruiser cost 
about $75K retail in Kazakhstan, he said.  This year, it will 
cost about $125K "because we now have to charge the Russian 
customs tariff."  Further, in June, customs-clearance 
companies will have to deposit one million euros cash with 
the Customs Committee, rather than have standard business 
insurance, as is now the case.  The CEO said, "I'm big enough 
that I don't care, except I'll lose the 7.5% interest I could 
get on that million.  But I can handle that."  He added he 
was worried this deposit requirement will force smaller 
companies out of business.  He claimed that the deposit is at 
the demand of Russia, whose policies disadvantage small 
businesses. 
 
3.  (C) Several of the CEOs agreed that Russia is more 
corrupt and bureaucratic than Kazakhstan.  They said, "Our 
businesses are more nimble, but inevitably the Russian 
culture will ooze in."  They asked why foreign investors 
would want to come to Kazakhstan rather than to Russia "when 
our labor pool is a tenth of the size of Russia's and much 
less well-educated -- and especially when the Customs Union 
will require us to phase out our Free Trade Zones."  Another 
CEO commented, "We're trying to meet European standards.  We 
don't want to be dragged down to Russian standards.  We can 
complain all we want about tariffs, but the real danger is 
that our business culture will suffer." 
 
U.S. ASSISTANCE 
 
4.  (C) Reacting to rumors that Kazakhstan is considering 
rejecting U.S. foreign assistance to Kazakhstan because it is 
fed up with its "dignity being insulted" by the semi-annual 
Congressionally-mandated human-rights certification process, 
one CEO said, with others nodding agreement, "$20 million? 
That's small change -- it has no meaning!  Rejecting $20 
million from the United States would be seen by the 
Kazakhstani public as a glamorous and bold statement of 
sovereignty.  Russia and China pour in billions in investment 
and never, ever criticize us.  Why don't you do something to 
win hearts and minds?  Our education and health-care systems 
are sub-standard.  Why don't you give us $2 billion a year 
for those sectors?  Why don't you do something concrete 
rather than preach and posture?  Your ideology is very rigid. 
 We love America, but we don't understand your government. 
You seem very Soviet to us; you demand we conform, when, in 
fact, we think we're doing quite well." 
HOAGLAND

Wikileaks

10ASTANA67, KAZAKSTAN: CHINA PRAISES ASTANA’S FOREIGN POLICY, WORRIES

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Reference ID Created Released Classification Origin
10ASTANA67 2010-01-25 06:35 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO6610
OO RUEHIK
DE RUEHTA #0067/01 0250635
ZNR UUUUU ZZH
O 250635Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7258
INFO RUCNCIS/CIS COLLECTIVE 2390
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHKO/AMEMBASSY TOKYO 2458
RUEHBJ/AMEMBASSY BEIJING 1752
RUEHUL/AMEMBASSY SEOUL 1368
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1948
RUEKJCS/SECDEF WASHDC 1798
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEKJCS/JOINT STAFF WASHDC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCNDT/USMISSION USUN NEW YORK 2677
RUEHNO/USMISSION USNATO 2967

UNCLAS SECTION 01 OF 03 ASTANA 000067 
 
NOFORN 
SIPDIS 
 
STATE FOR SCA/CEN, EAP/CM, EUR/RUS 
 
TAGS: PGOV PREL PINR EPET ECON NATO CH RU UZ KZ
SUBJECT:  KAZAKSTAN:  CHINA PRAISES ASTANA'S FOREIGN POLICY, WORRIES 
ABOUT RUSSIA 
 
REF:  A.  08 ASTANA 0812 
       B.  09 ASTANA 2168 
 
ASTANA 00000067  001.2 OF 003 
 
 
Classified By: Ambassador Richard E. Hoagland, 1.4 (A), (B), (D) 
 
1.  (S/NF) SUMMARY:  In his farewell courtesy call with the 
Ambassador on January 22, China's Ambassador to Kazakhstan Cheng 
Guoping (please protect) highly praised Kazakhstan's skillful 
balancing of the "great powers."  Repeatedly emphasizing the personal 
nature of the conversation, Cheng highlighted his view that China and 
Russia must "coexist" in Central Asia.  He expressed a positive view 
of the U.S. role in the region, but cautioned against a permanent 
military presence.  Cheng recommended that the United States urge 
Uzbekistan to invite NATO "as a guest" to attend the June summit in 
Tashkent of the Shanghai Cooperation Organization (SCO) in order to 
increase NATO-SCO cooperation.  Cheng departs Astana February 2 to 
return to Beijing to become Deputy Foreign Minister for Eurasia (the 
CIS).  We suspect Embassy Beijing will find him to be an interesting 
but reserved interlocutor.  END SUMMARY. 
 
FUTURE DEPUTY FOREIGN MINISTER 
 
2.  (S) Arriving in the Ambassador's office with a large gift bag of 
green tea "for the Ambassador's health," China's Ambassador to 
Kazakhstan Cheng Guoping (please protect) stressed his interest in 
maintaining close contact with the Ambassador after he returns to 
China February 2 to become Deputy Foreign Minister in charge of 
Eurasia (i.e., countries of the Commonwealth of Independent States). 
Among the key issues that he will handle, he mentioned relations with 
Russia, the SCO, and Kazakhstan.  Cheng argued, "Kazakhstan's role 
and importance is growing daily and is of great significance to China 
for political, economic, and security reasons."  He underlined the 
need to develop mutual trust in order to enhance Chinese influence in 
the region, especially because of the area's effect on China's 
security. 
 
SOPHISTICATED, SMART FOREIGN POLICY 
 
3.  (S) Cheng strongly agreed with the Kazakhstani Foreign Ministry's 
portrayal of Kazakhstan as a bridge between East and West, the OSCE 
and the SCO.  He emphasized the sophistication of Kazakhstan's 
foreign policy of balancing Russia, the United States, European 
Union, and China.  Highlighting Kazakhstan's membership in the 
Commonwealth Security Treaty Organization, the Eurasian Economic 
Community, and the Russia-Belarus-Kazakhstan Customs Union, Cheng 
stated that Kazakhstan still "attaches great importance to relations 
with the United States, China, and the European Union." 
 
4.  (S) Asserting that Kazakhstan is not a pro-Russian country, Cheng 
called its foreign policy "smart and successful, because good 
relations with China, the European Union, and the United States 
increase his (i.e., President Nazarbayev's) influence when he engages 
with Russia.  All countries in the region want to maintain their 
independence, but Russia wants to regain its regional influence.  CIS 
countries need Russian cooperation and good relations, but they all 
suspect Russia's intentions.  No CIS country wants to return to the 
Soviet period."  Comparing the current situations in Ukraine, 
Georgia, and Azerbaijan, Cheng again called Kazakhstan "smart" for 
cooperating with Russia as well as the United States, European Union, 
and China.  Cheng further argued that Kazakhstan's growing economy 
and influence allow it to resist Russian control. 
 
"CHINA MUST COOPERATE HERE" 
 
5.  (S) Elaborating on China's role in Central Asia, Cheng said, "The 
new oil and gas pipelines are breaking Russia's monopoly in energy 
exports and are decreasing the countries' dependence on Russia. 
Because Russia wants to maintain a monopoly on oil and gas exports in 
Central Asia, it dislikes the China-Kazakhstan pipeline (refs A-B)." 
According to Cheng, as China increases its regional "cooperation," 
the Russian Foreign Ministry wants to maintain close contact to 
ensure that it does not "harm Russia's core interests."  Cheng 
 
ASTANA 00000067  002.2 OF 003 
 
 
emphatically declared, "China must cooperate here.  The growth of 
Chinese influence will break the Russian monopoly in the region." 
 
COMPETITION AND COLLABORATION WITH RUSSIA 

 
6.  (S) Reflecting on his upcoming responsibilities, Cheng stated, "I 
will have to balance carefully increasing our cooperation with 
Central Asia with Russian interests.  However, we cannot harm our own 
interests because of Russia.  Competition and collaboration coexist 
in Chinese-Russian relations in Central Asia.  Our policy is to 
coexist here.  We must maintain a dialogue and consultations."  Cheng 
asserted that Russia and China can work together on security issues, 
such as terrorism and narcotics, to the benefit of all.  On the 
economic front, though, Cheng underlined their rivalry, and again 
asserted that Russia's reaction will not force it to limit its 
regional cooperation.  "In the future, great power relations in 
Central Asia will be complicated, delicate.  Kazakhstan is very 
smart, aware of the opportunities and that it must maintain a 
balance," he concluded. 
 
SUPPORT FOR U.S. REGIONAL ROLE 
 
7.  (S) In contrast to his unease with Russian influence, Cheng 
argued that the U.S. presence in the region promotes a "balance of 
the great powers."  Cheng emphasized China's support for U.S. efforts 
to fight the Taliban and terrorists, calling them a common challenge. 
 Nonetheless, he cautioned, "We have concerns if the United States 
uses the opportunity of fighting terrorists to enhance its military 
presence in the region."  The Ambassador reassured Cheng that the 
United States does not want a permanent military presence or bases in 
Central Asia.  Given President Obama's focus on Afghanistan and troop 
increases, he explained, Manas Transit Center -- and potentially 
other commercial transit centers for goods -- is very important. 
 
"KARIMOV NEEDS POLITICAL SUPPORT" 
 
8.  (S/NF) Cheng confided that he had "information" about the 
possibility of a new U.S. military transit center in Uzbekistan and 
called it a "delicate point."  Cheng expressed his belief that 
Karimov will agree to the proposal because "he needs political 
support and assistance from other countries due to Uzbekistan's 
difficulties, poor relations with Russia.  He is using the flag of 
anti-terrorism efforts to decrease criticism of his regime." 
 
NATO-SCO COOPERATION POSSIBLE 
 
9.  (S/NF) Replying to Cheng's assertion that "stabilization and 
reconstruction in Afghanistan will take a long time," the Ambassador 
asked if NATO-SCO consultations might be helpful.  Cheng highlighted 
the absence of an established NATO-SCO dialogue before expressing his 
personal viewpoint.  "If NATO wants to establish contact with the 
SCO, the host of the June 23 SCO Summit [Uzbekistan] can invite NATO 
to attend as a guest, which would increase understanding and 
cooperation."  He further suggested, as a first step, the United 
States recommend that NATO attend the meeting because of the event's 
anti-terrorism "content."  He argued, "The United States can attend 
the June 23 summit being hosted by Tashkent as Uzbekistan's guest in 
order to increase contact." 
 
10.  (S/NF) Again emphasizing the personal nature of this 
not-for-attribution advice, Cheng stated, "Russia supports it as far 
as I know.  China has not researched the issue, but Russia has ideas 
because of Afghanistan.  If the United States advances the 
suggestion, the Chinese government will actively consider it.  The 
United States must apply to Uzbekistan as the summit's host country. 
The Chinese government will be cautious, but agreement from Russia, 
Kazakhstan, and Uzbekistan would be good for the proposal.  The 
United States could attend as a guest of the host country." 
 
NO DIRECT CHINESE INVOLVEMENT IN AFGHANISTAN 
 
11.  (S) Cheng argued that the United States should attend the summit 
 
ASTANA 00000067  003.2 OF 003 
 
 
to "maintain stability and fight the Taliban and terrorists in 
Central Asia."  Cheng underlined the importance China attaches to 
Afghanistan and the defeat of the Taliban.  He also emphasized 
Chinese fear of the Taliban and Al-Qaida due to their "support of 
terrorists in Xinjiang."  Nonetheless, he asserted that China does 
not want "direct involvement in the fight because China's capacity to 
fight terrorists is less than the United States." 
 
CHINESE MEASURES TO SECURE THE PIPELINE 
 
12.  (S) Emphasizing China's large population, Cheng called 
preservation of security a big task, for which the Chinese capacity 
does not match that of the United States.  He especially underlined 
China's vulnerability to attacks on shipping and pipelines, which 
would strike at the heart of the Chinese economy.  According to 
Cheng, Chinese "measures" to secure the pipeline have included 
consultations between the "security departments" of China, 
Kazakhstan, Uzbekistan, and Turkmenistan.  He told the Ambassador 
that China has helped to train security personnel and provide 
equipment and weapons.  He said that China annually supplies 
materials to Kazakhstan's Ministry of Interior and National Security 
Committee (KNB). 
 
PERSONAL, NOT OFFICIAL, CONVERSATION 
 
13.  (S) Concluding this meeting that took place in the Ambassador's 
officer, Cheng again requested that the Ambassador not quote him.  He 
underlined his concern about dissemination of his personal 
reflections, which he said he conveyed due to his strong personal 
relationship with the Ambassador. 
 
BIOGRAPHIC NOTES 
 
14.  (S) Cheng Guoping departs Astana on February 2 for his new 
assignment as Chinese Deputy Foreign Minister in charge of CIS 
countries.  He said he might travel to the United States on 
consultations.  In addition, he plans to visit the United States upon 
retirement.  His daughter currently studies at the University of 
Iowa. 
 
15.  (S) This was the fourth time the Ambassador received Cheng in 
his office, where Cheng preferred to meet because, he has told the 
Ambassador, he does not feel comfortable speaking freely in his own 
office.  Even so, Chen exhibits maximum caution, whispering his 
comments in Mandarin (he does not speak English or Russian) to his 
interpreter.  We suspect that Embassy Beijing will find him to be an 
interesting but reserved interlocutor. 
 
16.  (S) COMMENT:  Fear about China regularly appears in 
conversations and the press in Kazakhstan.  Some Kazakhstanis worry 
about Chinese control of natural resources and proposals to lease 
agricultural land.  Because Kazakhstanis are attuned to their 
geography as a resource-rich country with vast swaths of uninhabited 
land bordering the world's most populous nation, they convey anxiety 
that the Chinese will arrive "like ants to colonize."  Cheng's 
portrayal of Chinese concerns about Kazakhstan's other large neighbor 
gives another perspective to the power game, which Kazakhstan so 
adeptly plays.  END COMMENT. 
 
HOAGLAND

Wikileaks

10ASTANA62, KAZAKHSTAN: MFA PUBLICLY DENIES POLITICAL PROBLEMS WITH

WikiLeaks Link

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Reference ID Created Released Classification Origin
10ASTANA62 2010-01-22 09:33 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO5059
OO RUEHIK
DE RUEHTA #0062 0220933
ZNR UUUUU ZZH
O 220933Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7249
INFO RUCNCIS/CIS COLLECTIVE 2389
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1751
RUEHKO/AMEMBASSY TOKYO 2457
RUEHUL/AMEMBASSY SEOUL 1367
RUCNDT/USMISSION USUN NEW YORK 2676
RUEHNO/USMISSION USNATO 2966
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1947
RUEKJCS/SECDEF WASHDC 1797
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS ASTANA 000062 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, S/SRAP, EUR/RUS, P/M 
 
E.O. 12958: N/A 
TAGS: PGOV PREL MARR RS AF KZ
SUBJECT:  KAZAKHSTAN:  MFA PUBLICLY DENIES POLITICAL PROBLEMS WITH 
EXPANDED OVERFLIGHT 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  In response to Russian Foreign Minister Lavrov's 
statement to "Radio Free Europe" that Kazakhstan is delaying full 
implementation of the U.S.-Russia Transit Agreement, Kazakhstan's 
Foreign Ministry made public today the U.S. request to add an 
additional route to the existing overflight agreement. 
Interfax-Kazakhstan news wire printed comments by the MFA's 
spokesman, who said Kazakhstan has no political problem with the 
proposal and is simply working out the "technical details" of the 
proposal and preparing it for parliament's review.  Full text of the 
article is below.  END SUMMARY. 
 
3.  (SBU) Begin full text of article. 
 
Kazakhstan to provide an additional air corridor for U.S. to 
transport cargoes to Afghanistan 
 
Astana.  January 21.  Interfax-Kazakhstan -- The Kazakh Ministry of 
Foreign Affairs is developing an international agreement to allow 
the U.S. to transport military cargoes to Afghanistan through an 
additional air corridor of Kazakhstan. 
 
Kazakhstan has been supporting the Operation Enduring Freedom from 
the very beginning and opened an air corridor back in 2001 for U.S. 
cargo transportation to Afghanistan through Kazakhstan, Askar 
Abdrakhmanov, the official representative of the Kazakh Ministry for 
Foreign Affairs, told Interfax-Kazakhstan. 
 
"Now the talks are about Kazakhstan to provide an additional air 
corridor that will run from Russia to Afghanistan.  The U.S. sent us 
a request last November asking to open this corridor," Mr. 
Abdrakhmanov said. 
 
Earlier the Russian foreign affairs minister, Sergei Lavrov, said 
that the U.S. could not transport their cargoes to Afghanistan as 
some technical issues had not been resolved with the Central Asian 
countries, Kazakhstan among them. 
 
"At the moment the Kazakh Ministry of Foreign Affairs and the 
concerned governmental agencies are drafting an international 
agreement which, when signed by the American side, will have to be 
ratified by the Kazakh parliament.   Cargo transit through the 
additional air corridor will become possible after the mentioned 
procedures are completed," Mr. Abdrakhmanov explained. 
 
According to him, the U.S. initiated the same talks with Russia much 
earlier than with Kazakhstan and, consequently, the talks were 
finished earlier too. 
 
"There are no political aspects involved here.  It is a purely 
technical issue as the Russian foreign minister said before," Mr. 
Abdrakhmanov stressed. 
 
Russia and the U.S. signed the agreement on military transit through 
Russia to Afghanistan in Moscow last year. 
 
HOAGLAND

Wikileaks

10ASTANA61, KAZAKHSTAN: BEHIND THE SCENES OF KARACHAGANAK AND

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. #10ASTANA61.
Reference ID Created Released Classification Origin
10ASTANA61 2010-01-22 09:32 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO5046
OO RUEHIK
DE RUEHTA #0061/01 0220932
ZNR UUUUU ZZH
O 220932Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7245
INFO RUCNCIS/CIS COLLECTIVE 2385
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1747
RUEHKO/AMEMBASSY TOKYO 2453
RUEHUL/AMEMBASSY SEOUL 1363
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 1943
RUEKJCS/SECDEF WASHDC 1793
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2209

UNCLAS SECTION 01 OF 04 ASTANA 000061 
 
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 SOCI RS KZ
SUBJECT:  KAZAKHSTAN:  BEHIND THE SCENES OF KARACHAGANAK AND 
KASHAGAN 
 
REF: (A) 08 ASTANA 2449 
     (B) 08 ASTANA 1646 
     (C) 09 ASTANA 0041 
     (D) 09 ASTANA 0352 
 
ASTANA 00000061  001.3 OF 004 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  For more than 90 minutes on January 20, Maksat 
Idenov, First Vice President of national oil company KazMunaiGas 
(KMG), briefed the Ambassador on the ongoing dispute between 
shareholders in the Karachaganak Petroleum Operating Company (KPO) 
and KMG.  In September 2009, KPO filed a claim at an international 
arbitration court in Stockholm for $1.4 billion for reimbursement of 
crude export duty payments.  Speaking without notes -- but with 
passion and conviction -- Idenov argued the government's case that 
KPO has not provided sufficient justification or supporting 
documentation for major expenditures since 2003.  He said the 
government has filed a counter-claim for $3 billion.  Unable to 
reach agreement at the level of corporate senior executive vice 
president, Idenov stated that the parties have begun talks at the 
level of corporate CEO.  The case is scheduled to go to arbitration 
on March 21.  Idenov also summarized budget negotiations for the 
massive, $150 billion Kashagan oil-exploration project.  In both 
cases, Idenov underlined that he only is asking international 
companies to follow fundamental principles of good business 
management.  END SUMMARY. 
 
BACKGROUND ON KARACHAGANAK 
 
3.  (U) KPO comprises Britain's BG Group (32.5%), Italy's ENI 
(32.5%), Chevron (20%), and Russia's Lukoil (15%).  One of the 
largest oil and gas condensate fields in the world, with reserves 
estimated at 1.2 billion tons of oil and 1.34 trillion cubic meters 
of gas, it is the only significant oil exploration project in 
Kazakhstan in which KMG does not have an equity stake (ref A). 
 
4.  (U) On September 18, 2009, Bloomberg reported that BG Group, as 
the lead operator, initiated arbitration proceedings to seek 
reimbursement of $1 billion for oil export customs duty payments 
made from June 2008-January 26, 2009, when the government lowered 
the crude export duty to zero (ref B).  On December 29, 2009, Prime 
Minister Karim Masimov told reporters that Kazakhstan wants to join 
the Karachaganak project as an equity partner, reportedly with a 10% 
stake.  (NOTE:  According to Idenov, the consortium claims $1.4 
billion while the government had filed a counter-claim for more than 
$3 billion.  When asked to comment on reports that KMG has requested 
10% of KPO, Idenov confirmed Masimov's statement, but concluded, 
"You never know how an arbitration case will play out."  END NOTE). 
 
 
IDENOV IN THE LEAD 
 
5.  (SBU) Contrary to reports from ExxonMobil, which is not a member 
of the KPO consortium, Idenov has retained the Karachangank 
portfolio and is the government's lead negotiator on the dispute 
(ref C).  He told the Ambassador that he met in London on January 11 
with executive vice presidents from the KPO shareholders, but they 
were unable to reach an accord.  As a result, Idenov said he will 
appeal to the companies' CEOs in an attempt to resolve the dispute. 
He implied that both sides are working in good faith to reach a 
negotiated settlement before the case goes to an international 
arbitration court in Stockholm on March 21. 
 
SHOW ME THE RECEIPTS 
 
6.  (SBU) Idenov told the Ambassador that KPO has submitted requests 
for reimbursement of hundreds of millions of dollars in expenses 
from 2003-2008, without proper justification or supporting 
documentation.  Launching into his brief, he jumped to a white board 
and began to make his case in graphic detail without the aid of 
notes.  According to Idenov, KMG retained the audit firm KPMG to 
 
ASTANA 00000061  002.3 OF 004 
 
 
review KPO's 2003-2006 statements and discovered that KMG reimbursed 
KPO for $697 million during that period, without proper supporting 
documentation.  He also asserted that the audit firm Ernst and Young 
reviewed KPO's statements from 2007-2008 and could not justify $347 
million in expenses.  Idenov told the Ambassador that when he 
presented this information to KPO executives, they replied, "All 
right, Maksat, we'll write you a check for that amount and just 
recover those costs later."  Idenov said he refused to do business 

that way, and would pursue the matter further. 
 
HIGH STAKES 
 
7.  (SBU) Idenov described in detail several situations dating to 
2002, where -- in his opinion -- KPO management made unwise 
decisions that cost KPO's shareholders dearly.  (NOTE:  Although KMG 
does not own equity in KPO, Idenov considers KMG, as the authorized 
agent of the Republic of Kazakhstan, a shareholder in the project. 
END NOTE.) 
 
-- In 2002, he said that President Nazarbayev attended the 
inauguration of a major new gas processing plant.  "There was a red 
ribbon and big scissors, and smiles all around," he described.  One 
week later, according to Idenov, a gas leak due to poor quality 
welding forced the plant to shut down and evacuate employees.  The 
plant remained idle for one year, "and the shareholders suffered," 
Idenov concluded. 
 
-- Also in 2002, the Atyrau-Bolshoi Shagan pipeline became plugged 
by caustic soda, because KPO pumped unprocessed condensate through 
the pipeline.  Idenov asserted that KPO cut off the damaged segments 
and rebuilt the pipeline at a cost of $600 million. 
 
-- In 2006, KPO's "Train 4," a processing unit that separates gas 
from liquids, was estimated to cost $467 million to build.  Idenov 
said he approved the expenditure, and then was told later that the 
project cost had escalated to more than $1 billion.  "I understand 
that the cost of construction can increase with time," he explained 
, "but give me some justification!" 
 
-- Idenov also mentioned KPO's $192 million purchase of new pipe 
racks for the project, which arrived before the cement foundation 
was laid on the platform.  As a result, the piperacks were stored 
outside, where they were punished by the severe climate of northern 
Kazakhstan, deteriorated, and were rendered useless. 
 
-- In 2006, Idenov said he authorized KPO to spend $478 million for 
the front-end engineering design (FEED) of Phase III expansion 
activities.  Once these funds were spent, he claimed, KPO requested 
another $300 million to fund a new design concept. 
 
-- In 2008, Idenov approved a request for $450 million to procure 
high-technology material (called X-60) that would resist corrosion 
by sour gas.  Later that year, KPO discovered that newer technology 
(called F-22) had come on the market, and requested another $480 
million to acquire the new material, abandoning the previous 
material. 
 
-- In 2009, according to Idenov, KPO submitted an annual budget for 
2010 of $2.1 billion.  Once Idenov reviewed the details, however, he 
said he could only find justification for $950 million. 
 
IMMEDIATE CONSEQUENCES 
 
8.  (SBU) Once KPO was presented with these findings, Idenov stated, 
BG Group's Senior Vice President Mark Carns was immediately fired, 
and other senior executives barely escaped a similar fate.  He 
asserted that BG Group's Peter Drunfield circulated an eight-page 
letter to Masimov and Samruk-Kazyna Deputy Chairman Timur Kulibayev, 
disputing Idenov's claims and asking for their support.  However, 
they refused to respond, and the KPO partners declined to support 
Drunfield, who subsequently left BG Group.  Idenov disclosed that 
 
ASTANA 00000061  003.3 OF 004 
 
 
KMG and KPO are now deep in negotiations on these issues, and 
suggested that he would elevate the discussion to the level of 
corporate CEO.  Idenov admitted that KMG also could provided better 
project oversight, and should have demanded the documents supporting 
KPO's expense claims years earlier. 
 
FIGHTING FOR FUNDAMENTAL PRINCIPLES 
 
9.  (SBU) Idenov mentioned complaints by KPO member companies -- 
with the notable exception of Chevron -- that he is causing trouble 
and making unreasonable demands.  "When they ask me, 'What are you 
fighting for?,' I tell them, 'Serve the shareholders honestly, and 
follow five simple business principles:  Quality Decisions; Quality 
Health, Safety, Security and Environment; Quality Technical 
Integrity; Quality Project Management; and -- most importantly -- 
Quality Internal Controls.  This is Kazakhstan's demand to KPO!'" 
(NOTE:  Idenov thanked the Ambassador for his September 28, 2009, 
speech on corporate responsibility to the members of the American 
Chamber of Commerce.  He contended that was the first time any 
Western ambassador has stressed publicly the theme in Kazakhstan. 
"It has made a huge difference," he said, "and will help U.S. 
companies, which set a good example for others."  END NOTE). 
 
AKSAI IN WONDERLAND 
 
10.  (SBU) Idenov highlighted KMG's demand that KPO's senior 
management staff move to Astana from London in order to provide 
proper oversight and supervision.  He complained about KPO's 
expenditure of $482 million on salaries and overhead expenses in 
2009, but just $320 million on oil and gas production services. 
"It's like Alice in Wonderland," he exclaimed.  "They're making 
their own rules, just like the White Rabbit.  You can start wherever 
you want, finish wherever you want, but there is one rule: 
everybody gets a prize.  Everybody gets paid." 
 
A DISSENTING VOICE 
 
11.  (SBU) In a private meeting on January 20, Alex Verba, chairman 
of Astana Law Partners LLP, strongly disputed the government's 
claims that KPO lacks supporting evidence for cost reimbursement. 
An auditor, Verba was a resident advisor on cost reimbursement 
issues to the Karachaganak project in Aksai from 2000-2005.  He 
argued that the government is trying merely to counterbalance the 
legitimate claim of KPO for reimbursement of illegal crude export 
duties.  Verba claimed that KMG has never done a professional audit 
of the cost-reimbursable claims, and that they lack the expertise to 
do a proper audit.  Verba also alleged that KMG has its own reasons 
for not conducting a full audit.  "Their people were benefitting 
from these subcontracts, and other arrangements, for years," he 
claimed.  Verba predicted that the government would lose its 
arbitration case.  "They haven't won one yet," he underlined. 
 
KASHAGAN'S 2010 BUDGET 
 
12.  (SBU) Having finished the litany of charges against 
Karachaganak, Idenov turned to Kashagan.  He highlighted the 
government's significant concern about the project to hook up the 
drilling islands to the onshore processing plant, which is 30% 
behind schedule and well over budget.  The initial tender won, he 
continued, with a bid of $196 million, but current costs have 
reached $443 million.  The original 2010 budget for Kashagan of 
$10.5 billion was reduced to $8.2 billion after careful review by 
KMG (ref C), he stated.  To illustrate, he told the Ambassador that 
the general director of the North Caspian Operating Company (NCOC), 
detailed from Total, is paying $22,000 per month for an apartment in 
Astana, and that other senior corporate executives are paying 
similar amounts.  Idenov said he approved these expenses, but warned 
the executives that the amounts were excessive. 
 
PHASE II UNDER REVIEW 
 
 
ASTANA 00000061  004.3 OF 0
04 
 
 
13.  (SBU) Idenov asserted that he agreed to Kashagan's Phase I 
budget of $38 billion, but has asked the consortium for supporting 
documentation and justification of planned expenditures.  In 
addition, he has not approved the request for $15 billion to fund 
Kashagan's Phase II development ($3.2 billion in 2010, $5 billion in 
2011, and $7 billion in 2012), "because they (Agip/ENI) are 
Italians.  Because they messed up (on Phase I).  Because I don't 
trust them.  They scared all of us with their management of Phase 
I," he explained.  Idenov expressed his preference for Phase II to 
first undergo FEED, which would enable the consortium to develop a 
more accurate and realistic project plan, but the partners 
protested.  According to Idenov, they said, "No!  Give us the $15 
billion and let's go!"  Idenov claimed he merely was trying to 
protect them from the Financial Police, who would likely launch an 
investigation into the project if large investments could not be 
justified.  Idenov also invited the Ambassador to send a 
representative to the next Kashagan budget meeting, claiming he had 
nothing to hide.  He even speculated that the private-sector 
partners would protest this unusual display of transparency. 
 
IDENOV'S FUTURE 
 
14.  (SBU) As the meeting came to a close, Idenov indicated that he 
had received job offers from Shell (where he used to be a Vice 
President for Strategic Planning), Agip, and Statoil.  Idenov 
dismissed these offers, saying it was just a way for the companies 
to remove an obstacle in their way.  "I'm not going away that 
easily," he asserted.  "But if the gentleman on the wall 
(Nazarbayev) says we shouldn't follow these five fundamental 
principles, then I will know that times have changed, and I will 
start to consider my options." 
 
15.  (SBU) COMMENT:  Maksat Idenov possesses a large and lively 
personality.  He clearly has critics in the government -- witness 
his shrinking portfolio -- and among the international oil 
companies.  However, it is hard to argue with his basic business 
principles, and reasonable to expect that projects as complex, 
costly, and critical as Karachaganak and Kashagan could be managed 
more efficiently.  Nevertheless, we hope that in both cases, the 
parties are able to reach accommodation without resort to legal 
action.  END COMMENT. 
 
HOAGLAND

Wikileaks

10ASTANA60, KAZAKHSTAN: BEHIND THE SCENES OF KARACHAGANAK AND

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. #10ASTANA60.
Reference ID Created Released Classification Origin
10ASTANA60 2010-01-22 09:31 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO5031
OO RUEHIK
DE RUEHTA #0060/01 0220931
ZNR UUUUU ZZH
O 220931Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7241
INFO RUCNCIS/CIS COLLECTIVE 2381
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1743
RUEHKO/AMEMBASSY TOKYO 2449
RUEHUL/AMEMBASSY SEOUL 1359
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 1939
RUEKJCS/SECDEF WASHDC 1789
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2205

UNCLAS SECTION 01 OF 04 ASTANA 000060 
 
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 SOCI RS KZ
SUBJECT:  KAZAKHSTAN:  BEHIND THE SCENES OF KARACHAGANAK AND 
KASHAGAN 
 
REF: (A) 08 ASTANA 2449 
     (B) 08 ASTANA 1646 
     (C) 09 ASTANA 0041 
     (D) 09 ASTANA 0352 
 
ASTANA 00000060  001.3 OF 004 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  For more than 90 minutes on January 20, Maksat 
Idenov, First Vice President of national oil company KazMunaiGas 
(KMG), briefed the Ambassador on the ongoing dispute between 
shareholders in the Karachaganak Petroleum Operating Company (KPO) 
and KMG.  In September 2009, KPO filed a claim at an international 
arbitration court in Stockholm for $1.4 billion for reimbursement of 
crude export duty payments.  Speaking without notes -- but with 
passion and conviction -- Idenov argued the government's case that 
KPO has not provided sufficient justification or supporting 
documentation for major expenditures since 2003.  He said the 
government has filed a counter-claim for $3 billion.  Unable to 
reach agreement at the level of corporate senior executive vice 
president, Idenov stated that the parties have begun talks at the 
level of corporate CEO.  The case is scheduled to go to arbitration 
on March 21.  Idenov also summarized budget negotiations for the 
massive, $150 billion Kashagan oil-exploration project.  In both 
cases, Idenov underlined that he only is asking international 
companies to follow fundamental principles of good business 
management.  END SUMMARY. 
 
BACKGROUND ON KARACHAGANAK 
 
3.  (U) KPO comprises Britain's BG Group (32.5%), Italy's ENI 
(32.5%), Chevron (20%), and Russia's Lukoil (15%).  One of the 
largest oil and gas condensate fields in the world, with reserves 
estimated at 1.2 billion tons of oil and 1.34 trillion cubic meters 
of gas, it is the only significant oil exploration project in 
Kazakhstan in which KMG does not have an equity stake (ref A). 
 
4.  (U) On September 18, 2009, Bloomberg reported that BG Group, as 
the lead operator, initiated arbitration proceedings to seek 
reimbursement of $1 billion for oil export customs duty payments 
made from June 2008-January 26, 2009, when the government lowered 
the crude export duty to zero (ref B).  On December 29, 2009, Prime 
Minister Karim Masimov told reporters that Kazakhstan wants to join 
the Karachaganak project as an equity partner, reportedly with a 10% 
stake.  (NOTE:  According to Idenov, the consortium claims $1.4 
billion while the government had filed a counter-claim for more than 
$3 billion.  When asked to comment on reports that KMG has requested 
10% of KPO, Idenov confirmed Masimov's statement, but concluded, 
"You never know how an arbitration case will play out."  END NOTE). 
 
 
IDENOV IN THE LEAD 
 
5.  (SBU) Contrary to reports from ExxonMobil, which is not a member 
of the KPO consortium, Idenov has retained the Karachangank 
portfolio and is the government's lead negotiator on the dispute 
(ref C).  He told the Ambassador that he met in London on January 11 
with executive vice presidents from the KPO shareholders, but they 
were unable to reach an accord.  As a result, Idenov said he will 
appeal to the companies' CEOs in an attempt to resolve the dispute. 
He implied that both sides are working in good faith to reach a 
negotiated settlement before the case goes to an international 
arbitration court in Stockholm on March 21. 
 
SHOW ME THE RECEIPTS 
 
6.  (SBU) Idenov told the Ambassador that KPO has submitted requests 
for reimbursement of hundreds of millions of dollars in expenses 
from 2003-2008, without proper justification or supporting 
documentation.  Launching into his brief, he jumped to a white board 
and began to make his case in graphic detail without the aid of 
notes.  According to Idenov, KMG retained the audit firm KPMG to 
 
ASTANA 00000060  002.3 OF 004 
 
 
review KPO's 2003-2006 statements and discovered that KMG reimbursed 
KPO for $697 million during that period, without proper supporting 
documentation.  He also asserted that the audit firm Ernst and Young 
reviewed KPO's statements from 2007-2008 and could not justify $347 
million in expenses.  Idenov told the Ambassador that when he 
presented this information to KPO executives, they replied, "All 
right, Maksat, we'll write you a check for that amount and just 
recover those costs later."  Idenov said he refused to do business 

that way, and would pursue the matter further. 
 
HIGH STAKES 
 
7.  (SBU) Idenov described in detail several situations dating to 
2002, where -- in his opinion -- KPO management made unwise 
decisions that cost KPO's shareholders dearly.  (NOTE:  Although KMG 
does not own equity in KPO, Idenov considers KMG, as the authorized 
agent of the Republic of Kazakhstan, a shareholder in the project. 
END NOTE.) 
 
-- In 2002, he said that President Nazarbayev attended the 
inauguration of a major new gas processing plant.  "There was a red 
ribbon and big scissors, and smiles all around," he described.  One 
week later, according to Idenov, a gas leak due to poor quality 
welding forced the plant to shut down and evacuate employees.  The 
plant remained idle for one year, "and the shareholders suffered," 
Idenov concluded. 
 
-- Also in 2002, the Atyrau-Bolshoi Shagan pipeline became plugged 
by caustic soda, because KPO pumped unprocessed condensate through 
the pipeline.  Idenov asserted that KPO cut off the damaged segments 
and rebuilt the pipeline at a cost of $600 million. 
 
-- In 2006, KPO's "Train 4," a processing unit that separates gas 
from liquids, was estimated to cost $467 million to build.  Idenov 
said he approved the expenditure, and then was told later that the 
project cost had escalated to more than $1 billion.  "I understand 
that the cost of construction can increase with time," he explained 
, "but give me some justification!" 
 
-- Idenov also mentioned KPO's $192 million purchase of new pipe 
racks for the project, which arrived before the cement foundation 
was laid on the platform.  As a result, the piperacks were stored 
outside, where they were punished by the severe climate of northern 
Kazakhstan, deteriorated, and were rendered useless. 
 
-- In 2006, Idenov said he authorized KPO to spend $478 million for 
the front-end engineering design (FEED) of Phase III expansion 
activities.  Once these funds were spent, he claimed, KPO requested 
another $300 million to fund a new design concept. 
 
-- In 2008, Idenov approved a request for $450 million to procure 
high-technology material (called X-60) that would resist corrosion 
by sour gas.  Later that year, KPO discovered that newer technology 
(called F-22) had come on the market, and requested another $480 
million to acquire the new material, abandoning the previous 
material. 
 
-- In 2009, according to Idenov, KPO submitted an annual budget for 
2010 of $2.1 billion.  Once Idenov reviewed the details, however, he 
said he could only find justificatmw)QQvc.yor executives barely escaped a similar fate.  He 
asserted that BG Group's Peter Drunfield circulated an eight-page 
letter to Masimov and Samruk-Kazyna Deputy Chairman Timur Kulibayev, 
disputing Idenov's claims and asking for their support.  However, 
they refused to respond, and the KPO partners declined to support 
Drunfield, who subsequently left BG Group.  Idenov disclosed that 
 
ASTANA 00000060  003.3 OF 004 
 
 
KMG and KPO are now deep in negotiations on these issues, and 
suggested that he would elevate the discussion to the level of 
corporate CEO.  Idenov admitted that KMG also could provided better 
project oversight, and should have demanded the documents supporting 
KPO's expense claims years earlier. 
 
FIGHTING FOR FUNDAMENTAL PRINCIPLES 
 
9.  (SBU) Idenov mentioned complaints by KPO member companies -- 
with the notable exception of Chevron -- that he is causing trouble 
and making unreasonable demands.  "When they ask me, 'What are you 
fighting for?,' I tell them, 'Serve the shareholders honestly, and 
follow five simple business principles:  Quality Decisions; Quality 
Health, Safety, Security and Environment; Quality Technical 
Integrity; Quality Project Management; and -- most importantly -- 
Quality Internal Controls.  This is Kazakhstan's demand to KPO!'" 
(NOTE:  Idenov thanked the Ambassador for his September 28, 2009, 
speech on corporate responsibility to the members of the American 
Chamber of Commerce.  He contended that was the first time any 
Western ambassador has stressed publicly the theme in Kazakhstan. 
"It has made a huge difference," he said, "and will help U.S. 
companies, which set a good example for others."  END NOTE). 
 
AKSAI IN WONDERLAND 
 
10.  (SBU) Idenov highlighted KMG's demand that KPO's senior 
management staff move to Astana from London in order to provide 
proper oversight and supervision.  He complained about KPO's 
expenditure of $482 million on salaries and overhead expenses in 
2009, but just $320 million on oil and gas production services. 
"It's like Alice in Wonderland," he exclaimed.  "They're making 
their own rules, just like the White Rabbit.  You can start wherever 
you want, finish wherever you want, but there is one rule: 
everybody gets a prize.  Everybody gets paid." 
 
A DISSENTING VOICE 
 
11.  (SBU) In a private meeting on January 20, Alex Verba, chairman 
of Astana Law Partners LLP, strongly disputed the government's 
claims that KPO lacks supporting evidence for cost reimbursement. 
An auditor, Verba was a resident advisor on cost reimbursement 
issues to the Karachaganak project in Aksai from 2000-2005.  He 
argued that the government is trying merely to counterbalance the 
legitimate claim of KPO for reimbursement of illegal crude export 
duties.  Verba claimed that KMG has never done a professional audit 
of the cost-reimbursable claims, and that they lack the expertise to 
do a proper audit.  Verba also alleged that KMG has its own reasons 
for not conducting a full audit.  "Their people were benefitting 
from these subcontracts, and other arrangements, for years," he 
claimed.  Verba predicted that the government would lose its 
arbitration case.  "They haven't won one yet," he underlined. 
 
KASHAGAN'S 2010 BUDGET 
 
12.  (SBU) Having finished the litany of charges against 
Karachaganak, Idenov turned to Kashagan.  He highlighted the 
government's significant concern about the project to hook up the 
drilling islands to the onshore processing plant, which is 30% 
behind schedule and well over budget.  The initial tender won, he 
continued, with a bid of $196 million, but current costs have 
reached $443 million.  The original 2010 budget for Kashagan of 
$10.5 billion was reduced to $8.2 billion after careful review by 
KMG (ref C), he stated.  To illustrate, he told the Ambassador that 
the general director of the North Caspian Operating Company (NCOC), 
detailed from Total, is paying $22,000 per month for an apartment in 
Astana, and that other senior corporate executives are paying 
similar amounts.  Idenov said he approved these expenses, but warned 
the executives that the amounts were excessive. 
 
PHASE II UNDER REVIEW 
 
 
ASTANA 00000060  004.3 OF 004 
 
 
13.  (SBU) Idenov asserted that he agreed to Kashagan's Phase I 
budget of $38 billion, but has asked the consortium for supporting 
documentation and justification of planned expenditures.
In 
addition, he has not approved the request for $15 billion to fund 
Kashagan's Phase II development ($3.2 billion in 2010, $5 billion in 
2011, and $7 billion in 2012), "because they (Agip/ENI) are 
Italians.  Because they messed up (on Phase I).  Because I don't 
trust them.  They scared all of us with their management of Phase 
I," he explained.  Idenov expressed his preference for Phase II to 
first undergo FEED, which would enable the consortium to develop a 
more accurate and realistic project plan, but the partners 
protested.  According to Idenov, they said, "No!  Give us the $15 
billion and let's go!"  Idenov claimed he merely was trying to 
protect them from the Financial Police, who would likely launch an 
investigation into the project if large investments could not be 
justified.  Idenov also invited the Ambassador to send a 
representative to the next Kashagan budget meeting, claiming he had 
nothing to hide.  He even speculated that the private-sector 
partners would protest this unusual display of transparency. 
 
IDENOV'S FUTURE 
 
14.  (SBU) As the meeting came to a close, Idenov indicated that he 
had received job offers from Shell (where he used to be a Vice 
President for Strategic Planning), Agip, and Statoil.  Idenov 
dismissed these offers, saying it was just a way for the companies 
to remove an obstacle in their way.  "I'm not going away that 
easily," he asserted.  "But if the gentleman on the wall 
(Nazarbayev) says we shouldn't follow these five fundamental 
principles, then I will know that times have changed, and I will 
start to consider my options." 
 
15.  (SBU) COMMENT:  Maksat Idenov possesses a large and lively 
personality.  He clearly has critics in the government -- witness 
his shrinking portfolio -- and among the international oil 
companies.  However, it is hard to argue with his basic business 
principles, and reasonable to expect that projects as complex, 
costly, and critical as Karachaganak and Kashagan could be managed 
more efficiently.  Nevertheless, we hope that in both cases, the 
parties are able to reach accommodation without resort to legal 
action.  END COMMENT. 
 
HOAGLAND

Wikileaks

10ASTANA56, KAZAKHSTAN: NUR OTAN DEPUTY CHAIR LAYS OUT HIS PRIORITIES

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Reference ID Created Released Classification Origin
10ASTANA56 2010-01-21 04:32 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO3692
OO RUEHIK
DE RUEHTA #0056/01 0210432
ZNR UUUUU ZZH
O 210432Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7234
INFO RUCNCIS/CIS COLLECTIVE 2379
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1741
RUEHKO/AMEMBASSY TOKYO 2447
RUEHUL/AMEMBASSY SEOUL 1357
RUCNDT/USMISSION USUN NEW YORK 2674
RUEHNO/USMISSION USNATO 2964
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1937
RUEKJCS/SECDEF WASHDC 1787
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS SECTION 01 OF 02 ASTANA 000056 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, EUR/RPM, DRL 
 
E.O. 12958: N/A 
TAGS: PGOV PREL PHUM PINR KDEM OSCE KZ
SUBJECT:  KAZAKHSTAN:  NUR OTAN DEPUTY CHAIR LAYS OUT HIS PRIORITIES 
 
REF:  A.  09 ASTANA 1516 
      B.  09 ASTANA 2148 
 
ASTANA 00000056  001.2 OF 002 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) SUMMARY:  The recently-appointed Deputy Chairman of 
President Nazarbayev's ruling Nur Otan party (Nazarbayev is the 
Chairman) told the Ambassador on January 19 that Kazakhstan's OSCE 
Chairmanship is a sign of its growing international standing.  He 
raised Kazakhstan's desire for a meeting between Presidents Obama 
and Nazarbayev during the April Global Nuclear Security Summit.  He 
detailed Nur Otan's plan to send a delegation to Washington in March 
to learn about organization and strategy from U.S. political 
parties.  Nur Otan has recently shifted focus onto the regions to 
ensure that "the people see the government doing something." 
Nigmatulin categorically denied that this increased activity 
suggests the party is getting ready for early elections.  The 
Ambassador stressed the need to fulfill some of the goals laid out 
in the "Human Rights Action Plan for 2009-2012" (ref A).  END 
SUMMARY. 
 
"HISTORIC YEAR" 
 
3.  (SBU) On January 19, the Ambassador met with the Deputy Chairman 
of the President's ruling Nur Otan party Nurlan Nigmatullin, who was 
appointed to his position on November 19, 2009.  Nigmatulin called 
2010 a "historic year" for Kazakhstan.  The Chairmanship of the OSCE 
signifies the growing international standing of Kazakhstan and 
President Nazarbayev, he said.  The Ambassador underlined U.S. 
support for Kazakhstan's priorities in all three OSCE dimensions and 
readiness to work with Kazakhstan to make its Chairmanship a 
success. 
 
PUSH FOR NAZARBAYEV-OBAMA MEETING 
 
4.  (SBU) Nigmatulin noted that a meeting between Presidents Obama 
and Nazarbayev during the April Global Nuclear Security Summit 
(GNSS) would "be a strong sign" of the cooperation between 
Kazakhstan and the United States and, he emphasized, would "serve as 
a base" for the future.  He highlighted that UN General Assembly's 
recent adoption of Kazakhstan's proposal to make August 29, the day 
Kazakhstan officially renounced its nuclear arsenal, the 
International Day against Nuclear Tests.  The Ambassador expressed 
his certainty that President Nazarbayev will make an important 
contribution to the GNSS, especially because of Kazakhstan's strong 
non-proliferation record.  The Ambassador said that the White House 
continues to develop the President's schedule and noted that over 40 
heads of state are expected to attend the GNSS. 
 
NUR OTAN TO VISIT WASHINGTON 
 
5.  (SBU) Nigmatulin told us that a Nur Otan delegation will travel 
to the United States in March on a working visit.  The visit aims to 
establish links with U.S. political parties and learn more about 
election campaigns and platform development.  Kazakhstan's embassy 
in Washington will also organize a round-table on Kazakhstan's OSCE 
Chairmanship.  Nigmatulin praised Nur Otan's cooperation with the 
National Democratic Institute (NDI) and International Republican 
Institute (IRI).  The Ambassador affirmed the U.S. government's 
readiness to work with the Kazakhstani Embassy in Washington to make 
the delegation's trip successful and productive.  He welcomed 
Nigamtulin's views on ways to increase the effectiveness of NDI and 
IRI's programs. 
 
GOING TO THE PEOPLE 
 
6.  (SBU) The Ambassador asked Nigmatulin about his priorities for 
Nur Otan, specifically the party's anti-corruption campaign.  (NOTE: 
 Soon after taking office, Nigmatulin announced that the fight 
against corruption is his top priority.  END NOTE.)  Nigmatulin said 
the anti-corruption effort "will not lessen, and will, in fact, 
strengthen."  He noted that having established its credentials 
nationally, Nur Otan has shifted focus to the regions.  "The people 
must see and feel that the government is doing something," he 
 
ASTANA 00000056  002.2 OF 002 
 
 
stated.  Fully agreeing, the Ambassador noted that cooperation 
between local civil-society NGOs and local governments to resolve 
local problems exemplifies democracy at work. 
 
NO EARLY ELECTIONS 
 
7.  (SBU) The Ambassador asked Nigmatulin about the persistent 
rumors that the government will call early elections in 2010. 
Nigmatulin categorically denied a link between Nur Otan's increased 
activity in the regions and preparations for early elections.  After 
asking his assistant t
o turn off two tape recorders left on the 
table by journalists present at the meeting's start, Nigmatulin told 
the Ambassador, with a more relaxed and confidential air, that he 
"knows all the oppositionists personally" and is familiar with the 
"election rumors that frequently appear" in the opposition press. 
"Let me reassure you that our increased activity is simply a 
political party at work," he stressed to the Ambassador. 
 
"UNDER A SPOTLIGHT" 
 
8.  (SBU) The Ambassador asked about the implementation of the 
"Human Rights Action Plan for 2009-2012" (ref A) and stressed the 
need to address at least some of the plan's priorities during 
Kazakhstan's OSCE Chairmanship.  Nigmatulin responded, "Literally, I 
am flying to Almaty this afternoon to meet with academics and other 
specialists in Almaty to present Nur Otan's strategy, which will 
correspond in part to the Human Rights Action Plan's goals.  The 
Ambassador noted that the OSCE Chairmanship has placed Kazakhstan 
"under a spotlight.  Both positive and negative reports are 
inevitable," he stressed, "and Kazakhstan needs to take bold and 
concrete steps that increase the positive."  Fully agreeing, 
Nigmatulin concluded, "Image is crucial, and we must fully realize 
we are under a hot spotlight." 
 
BIO NOTE 
 
9.  (SBU) Born on August 31, 1962, in Karaganda, Kazakhstan, Nurlan 
Nigmatulin holds a degree from the Karaganda Polytechnic University. 
 He worked only one year as an engineer before being selected to 
lead the Karaganda Komsomol (Soviet Young Communist Organization). 
After independence, Nigmatulin rose quickly in Kazakhstan's 
political circles, serving as the Deputy Head of Operations for the 
Presidential Administration in 1995-1999, then as Deputy Akim 
(Mayor) of Astana in 1999-2002, followed by two years as Vice 
Minister of Transport and Communication, and returned to the 
Presidential Administration as Head of Human Resources in 2004-2006. 
 From 2006 until his most recent appointment, Nigmatulin was the 
governor of the Karaganda oblast.  He proudly told the Ambassador, 
breaking into ffairly fluent English, that Karaganda is "where 
Nazarbayev got his start" at the Temirtau Metallurgical Plant. 
Nigmatulin is married with three sons.  His twin brother Yerlan is a 
member of  parliament. 
 
10.  (SBU) COMMENT:  Nur Otan officials unequivocally deny the 
possibility of early elections -- along with Nigmatulin, the party's 
Secretary Yerlan Karin told the DCM in December that there are no 
plans for elections before 2012 (ref B).  However, even Karin 
admitted that "all depends on the Ak Orda" (Presidential 
Admnistration), and the President might choose to call elections at 
any moment.  Nur Otan's consultation with civil society on ways to 
implement elements of the "Human Rights Action Plan" is noteworthy, 
but whether this will translate into concrete orders from the 
Presidency and action from the parliament, which Nur Otan fully 
controls, remains to be seen.  We should certainly highlight this 
point when the party's delegation visits Washington in March.  The 
more we can press on cracked-open doors, the more chance we will 
have for success.  END COMMENT. 
 
HOAGLAND

Wikileaks

10ASTANA54, KAZAKHSTAN: SENATE CHAIRMAN INVITES AMBASSADOR HOLBROOKE

WikiLeaks Link

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Reference ID Created Released Classification Origin
10ASTANA54 2010-01-20 10:13 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO2858
OO RUEHIK
DE RUEHTA #0054/01 0201013
ZNR UUUUU ZZH
O 201013Z JAN 10
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TO RUEHC/SECSTATE WASHDC IMMEDIATE 7231
INFO RUCNCIS/CIS COLLECTIVE 2377
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1739
RUEHKO/AMEMBASSY TOKYO 2445
RUEHUL/AMEMBASSY SEOUL 1355
RUCNDT/USMISSION USUN NEW YORK 2672
RUEHNO/USMISSION USNATO 2962
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1935
RUEKJCS/SECDEF WASHDC 1785
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS SECTION 01 OF 02 ASTANA 000054 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/CEN, EUR/RPM, S/SRAP 
 
E.O. 12958: N/A 
TAGS: PGOV PREL PHUM OSCE AF KZ
SUBJECT:  KAZAKHSTAN:  SENATE CHAIRMAN INVITES AMBASSADOR HOLBROOKE 
TO OSCE FORUM 
 
ASTANA 00000054  001.2 OF 002 
 
 
1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
2.  (SBU) Kazakhstan's Ministry of Foreign Affairs forwarded via 
diplomatic note an invitation from Kazakhstani Senate Chairman 
Kassym-Zhomart Tokayev to U.S. Special Representative Richard 
Holbrooke to participate in the Second Trans-Asian Parliamentary 
Forum entitled "The OSCE Eurasian Dimension."  Co-organized by 
Kazakhstan and the OSCE Parliamentary Assembly, the forum will take 
place in Almaty May 14-15.  The English-language text of the letter 
is below, and a copy of the invitation, along with a proposed 
agenda, will be forwarded to the desk.  Post would appreciate the 
Department's assistance in passing the information to Special 
Representative Holbrooke. 
 
3.  (SBU) BEGIN TEXT OF LETTER: 
 
Astana, December 15, 2009 
 
Your Excellency, 
 
It gives me a great pleasure to extend my highest consideration and 
best regards to you on behalf of the Parliament of the Republic of 
Kazakhstan. 
 
I am following with keen interest your activities as United States 
Special Envoy for Afghanistan and Pakistan and wish you success in 
bringing stability in that region. 
 
As you are well aware, next year Kazakhstan will assume the 
presidency in the Organization for Security and Cooperation in 
Europe. It's a huge privilege and great responsibility for my 
country since Kazakhstan is the first among CIS member-states, also 
Asian countries and the Muslim world, to lead this huge 
Organization. 
 
In its new capacity Kazakhstan will remain strongly committed to the 
principles and objectives of the OSCE that we have always been 
adhering to.  At the same time we are of a view that it is extremely 
important to enhance OSCE involvement in the Eurasian security 
architecture.  There can be no doubt that the regional stability and 
fight against terrorism, extremism, drug trafficking, organized 
crime and trafficking in human beings will gain full support of all 
the OSCE countries and our Asian and Mediterranean Partners. 
 
To continue full-pledged assistance to Afghanistan in its economic 
reconstruction in close cooperation with local authorities and 
international community is a matter of primary importance for 
Kazakhstan. 
 
Engagement of OSCE will become an additional and efficient way to 
coordinate the joint efforts to ensure security and stability in 
Afghanistan. Thus during its Presidency of the OSCE, Kazakhstan is 
determined to make sure that every effort is undertaken to 
respectively respond to those challenges. 
 
In light of Kazakhstan's OSCE Chairmanship in 2010, our Parliament 
in cooperation with the OSCE Parliamentary Assembly will host in 
Almaty on 14-15 May 2010 the Second Trans-Asian Parliamentary Forum 
entitled "The OSCE Eurasian Dimension." 
 
Parliamentary delegations from the OSCE participating States, Asian 
and Mediterranean Partner countries, including Afghanistan, and also 
parliamentarians from China, India and Pakistan are invited to this 
conference to discuss pressing issues on regional security, economic 
and environmental developments as well as human dimension. 
 
Taking into consideration your rich experience as a prominent 
politician and expert on Eurasian affairs who has a view and 
understanding of various regional security aspects, I have the honor 
to invite you to participate in this forum as a keynote speaker. 
 
I am confident that your presentation and analyses will be of great 
interest for the delegations of the parliamentary conference and 
contribute to the lively discussion on regional issues. 
 
ASTANA 00000054  002.2 OF 002 
 
 
 
Please be advised that your travel by business-class flight and 
accommodation expenses will be borne by the Kazakh Parliament. 
 
I look forward to welcoming you in Almaty next May. 
 
Yours sincerely, 
Kassym-Jomart Tokayev. 
 
END TEXT. 
 
HOAGLAND

Wikileaks

10ASTANA53, KAZAKHSTAN: EUROPEAN DIPLOMATS DISCUSS NABUCCO GAS PIPELINE

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Reference ID Created Released Classification Origin
10ASTANA53 2010-01-20 09:17 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO2805
RR RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL RUEHSR
DE RUEHTA #0053/01 0200917
ZNY CCCCC ZZH
R 200917Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 7229
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUCNCIS/CIS COLLECTIVE 2375
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1737
RUEHUL/AMEMBASSY SEOUL 1353
RUEHKO/AMEMBASSY TOKYO 2443
RHMFISS/CDR USCENTCOM MACDILL AFB FL
RUEAIIA/CIA WASHDC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1933
RUEKJCS/JOINT STAFF WASHDC
RUEKJCS/SECDEF WASHDC 1783

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 000053 
 
SIPDIS 
 
STATE FOR SCA/CEN 
 
E.O. 12958: DECL: 03/06/2059 
TAGS: PGOV PREL ECON EPET TX RS KZ
SUBJECT:  KAZAKHSTAN:  EUROPEAN DIPLOMATS DISCUSS NABUCCO GAS PIPELINE 
 
REF: 09 ASTANA 2100 
 
Classified By: Ambassador Richard E. Hoagland, 1.4 (b), (d) 
 
1.  (C) SUMMARY:  Discussion with European diplomats at January 14-15 
energy events centered on the Nabucco gas pipeline, and what role -- 
if any -- Kazakhstan would likely play in supplying natural gas to 
Europe via a "southern corridor."  There was also agreement that 
Turkmenistan's ability to diversify gas export routes has created 
anxiety in Moscow, although Russia is likely to remain Turkmenistan's 
primary market for the foreseeable future.  END SUMMARY. 
 
A "REAL SHIFT" IN KAZAKHSTAN'S POSITION ON NABUCCO 
 
2.  (C) At a small, private January 14 luncheon hosted by Hungarian 
Ambassador Janos Balla, Hungary's Ambassador-at-Large for Energy 
Security, Mihaly Bayer said he decided to visit Astana now in order 
to follow up on President Nazarbayev's positive comments about 
Nabucco from his October 22-24 visit to Turkey (reftel).  During his 
state visit, Nazarbayev publically and unequivocally declared for the 
first time that Kazakhstani oil and gas will flow through Turkey. 
Bayer said he feels "a real shift" in Kazakhstan's position.  In 
several years, he underlined, Kazakhstan will need new markets when 
its gas production increases.  At a press conference in Astana on 
January 14, Bayer stated the need for higher-level talks with 
Kazakhstan on the Nabucco project.  "I think it is time," he said, 
"to talk directly with the Kazakhstani leadership why we need 
Nabucco, what are the opportunities for cooperation, and how 
Kazakhstan can benefit from such cooperation."  According to Bayer, 
"gas production in Kazakhstan is on the rise, and starting in 2011, 
it will be growing at an even faster pace.  Why," he asked, "is it so 
impossible to assume that Europe might have some portion of it?" 
(NOTE:  On January 20, Timur Imashev, Director of the Gas Industry 
Department of the Ministry of Energy and Mineral Resources, told 
Energy Officer that Kazakhstan does not currently produce enough 
natural gas to supply Nabucco, but would likely be able to do so once 
the enormous Kashagan oil field is developed.  However, he said that 
Kazakhstan would follow Turkmenistan's example and sell natural gas 
only at the border, rather than investing in pipeline projects.  END 
NOTE). 
 
3.  (C) Bayer believes that Kazakhstan has paid close attention to 
the April 2009 pipeline explosion in Turkmenistan, and Russia's 
subsequent treatment of Turkmenistan.  He further speculated that 
Kazakhstan currently worries that something similar could happen to 
them, too.  Thus, he sees "a window to capitalize" on Kazakhstan's 
current perception.  Bayer said he is telling Kazakhstan that Europe 
wants to diversify routes and supplies, while Kazakhstan wants to 
diversify its markets; this makes sense for both.  Bayer said, 
"Change is slow in this part of the world, but it can happen here. 
However, they will take only those risks that can be covered." 
 
WHO WILL SUPPLY THE GAS? 
 
4.  (C) During the January 14 energy conference in Batumi, Bayer 
reported, Azerbaijan objected to any mention of Nabucco in the text 
of the final document.  Bayer said he expects no real movement from 
Azerbaijan on Nabucco until significant movement occurs on 
Ngorno-Karabakh.  He commented to the Ambassador, "Your 'interim' 
situation without an accredited Ambassador in Baku is decidedly 
regrettable.  They see it as a 'signal.'  And your situation in 
Ashgabat is simply absurd."  Bayer said Nabucco does not need, nor is 
pursuing, gas from Iran.  Significant gas from Iraq is becoming more 
and more a real possibility. 
 
HOPE FOR A DULL -- AND PRODUCTIVE -- NEW YEAR 
 
5.  (C) Bayer expressed his expectation and hope for a "relatively 
dull year" for Nabucco.  He called completion of the first part, the 
inter-governmental agreement (IGA), "a real breakthrough.  Now, we 
have to work behind the scenes on the more technical parts, including 
host government agreements, design, building permits, and financing. 
International financial institutions (IFI) like the EBRD, European 
Investment Bank, and International Finance Corporation are already 
firmly committed," he averred.  However, Bayer mentioned a private 
 
ASTANA 00000053  002 OF 002 
 
 
concern that the IFIs will not accept sovereign guarantees from 
Nabucco shareholder-partners Romania and Bulgaria. 
 
SOUTH STREAM SKEPTICISM 
 
6.
(C) About Hungary and South Stream, Bayer underlined that two 
years have passed since Budapest signed on to South Stream -- and 
nothing has happened.  Two years ago, Nabucco was "dormant," but now 
the situation (between Nabucco and South Stream) has totally flipped. 
 The new Hungarian government is no longer straddling the fence 
between Nabucco and South Stream.  The new Hungarian Prime Minister 
has declared publically for the first time, "Hungary favors Nabucco." 
 According to Bayer, the Hungarian government's natural-gas 
priorities are 1) Nabucco, 2) LNG, and then 3) South Stream (if it 
ever happens). 
 
TURKMENISTAN'S DESIRE TO DIVERSIFY 
 
7.  (C) During a monthly energy security roundtable, European 
diplomats agreed on Turkmenistan's success in diversifying gas-export 
routes in a short period of time.  In addition to a new gas pipeline 
to China, in just 18 months, Turkmenistan has expanded existing 
capacity to export gas to Iran, and reopened the gas pipeline to 
Russia.  The British Energy Officer reported that the pipeline to 
China will ship just six bcm initially, but Turkmenistan will export 
up to 30 bcm to China by 2013 at a price of $195/thousand cubic feet, 
including possibly via a second, parallel gas pipeline.  He also 
asserted that Turkmenistan plans to increase exports to Iran to 20 
bcm by 2011.  According to Austria's Ambassador to Kazakhstan, who 
attended the previous luncheon at the Hungarian Embassy, Bayer said 
that Turkmenistan has clearly demonstrated its desire to diversify 
and willingness to "court" the European Union as a partner. 
 
FROM RUSSIA, WITH ANXIETY 
 
8.  (C) The European diplomats agreed that increased diversification 
and energy independence in Turkmenistan have raised anxiety levels in 
Russia.  "It is no accident that the pipeline to Russia was back in 
business after Medvedev's visit to Ashgabat," said the British Energy 
Officer.  He argued that if Europe is serious about importing Turkmen 
gas, it must send high-level delegations to 
Ashgabat to make the case directly to President Berdimuhamedov.  The 
UK, he added, will send Minister of Energy Lord Hunt to Baku, Astana, 
and Ashgabat at the end of February/beginning of March.  Noting that 
Russia had been paying for Turkmen gas six months after delivery, he 
said that Turkmenistan only "felt the pain" of the pipeline explosion 
in November, which is when the government began more actively to push 
for alternative export routes. 
 
CASPIAN LITTORAL PIPELINE 
 
9.  (C) On the first morning of his visit to Astana, Bayer met with 
Vice Minister for Energy and Mineral Resources Aset Magauov.  When 
Bayer asked about the Caspian Littoral (Prikaspiskii) pipeline, he 
said Magauov answered, "The Central Asia Center (gas pipeline) is at 
only half capacity.  In 2010, Turkmenistan will sell only about 12 
billion cubic meters (bcm) to Russia.  At this time, no one needs 
Prikaspiskii and no one is paying any attention to it." 
 
10.  (C) COMMENT:  Primarily an oil exporter, Kazakhstan cannot 
realistically be expected to serve as the Nabucco gas pipeline's main 
supplier.  Furthermore, Kazakhstan's leadership takes a serious 
political risk vis-a-vis its relationship with Russia every time it 
issues statements even vaguely supportive of the Nabucco project. 
Nevertheless, as Kashagan oil production comes online in 2013 and 
beyond, significant quantities of Kazakhstani gas will be available 
for export.  The amount that will go to China via the new gas 
pipeline (design capacity, 40 bcm) remains unclear, but we fully 
expect Kazakhstan to increase overall natural gas exports over the 
next five years.  To answer Mr. Bayer's question, Europe well might 
receive some portion of it.  END COMMENT. 
 
HOAGLAND

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10ASTANA52, KAZAKHSTAN: OVERFLIGHTS AND NORTHERN DISTRIBUTION NETWORK

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Reference ID Created Released Classification Origin
10ASTANA52 2010-01-20 07:50 2011-08-30 01:44 SECRET//NOFORN Embassy Astana

VZCZCXRO2748
OO RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL
DE RUEHTA #0052/01 0200750
ZNY SSSSS ZZH
O 200750Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7227
INFO RUCNCIS/CIS COLLECTIVE 2373
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUCNAFG/AFGHANISTAN COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1735
RUEHKO/AMEMBASSY TOKYO 2441
RUEHUL/AMEMBASSY SEOUL 1351
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1931
RUEKJCS/SECDEF WASHDC 1781
RUEKJCS/JOINT STAFF WASHDC
RHMFISS/CDR USCENTCOM MACDILL AFB FL
RUCNDT/USMISSION USUN NEW YORK 2670
RUEHNO/USMISSION USNATO 2960
RHMFISS/CDR USTRANSCOM SCOTT AFB IL

S E C R E T SECTION 01 OF 02 ASTANA 000052 
 
NOFORN 
SIPDIS 
 
STATE FOR SCA/CEN, S/SRAP, EUR/RUS, PM 
NSC FOR JOYCE CONNERY 
 
E.O. 12958: 01/20/2030 
TAGS: PGOV PREL PINR MARR AF RS UZ KZ
SUBJECT:  KAZAKHSTAN:  OVERFLIGHTS AND NORTHERN DISTRIBUTION NETWORK 
SHIPMENTS FULLY OPERATIONAL 
 
Classified By: Ambassador Richard E. Hoagland:  1.4 (A), (B), (D) 
 
REFTELS:  A.  09 ASTANA 2190 
          B.  09 ASTANA 2198 
      C.  09 ASTANA 2204 
          D.  09 ASTANA 2272 
          E.  ASTANA 0020 
 
 
1.  (S/NF) This is an action request (see para 8). 
 
2.  (S/NF) SUMMARY:  Kazakhstan continues to be an important partner 
for the U.S. government mission to stabilize Afghanistan.  Under the 
2001 overflight agreement, the United States has completed more than 
8000 overflights.  In addition, the U.S. government has used the 2009 
Northern Distribution Network agreement to ship 6439  containers  to 
Afghanistan in support of Operation Enduring Freedom (OEF).  These 
transits have occurred without any major incident despite occasional 
bureaucratic hiccups.  Post recommends expanding this successful 
partnership, including increasing local procurement, to support more 
efficient provision of military supplies in support of Operation 
Enduring Freedom.  END SUMMARY. 
 
U.S. COMPLETES THOUSANDS OF OVERFLIGHTS AND SHIPMENTS IN 2009 
 
3.  (S/NF) Since implementation of the 2001 overflight agreement, 
more than 8000 overflights and 85 diverts have occurred without major 
incident, including over 1000 overflights in 2009.  Since the 
Kazakhstani government agreed to permit the transportation of 
commercial cargo via the Northern Distribution Network (NDN) on 
December 30, 2008, 6439 containers have reached Afghanistan via 
Kazakhstan as of January 14. 
 
4.  (S/NF) U.S. government contacts and contractors have not reported 
any major problems with transportation through Kazakhstan along the 
NDN.  The transit agreement between the United States and Uzbekistan, 
which requires diplomatic notes for each shipment, initially retarded 
movement and led to limited backlogs.  Since the Uzbek government 
agreed to speed up the diplomatic note process, backlogs have been 
eliminated. 
 
NO PROBLEMS WITH SHIPMENTS IN COMPLIANCE WITH AGREEMENTS 
 
5.  (S/NF) On December 28, Post received an e-mail request for 
assistance from the TRANSCOM Liaison Officer in Tashkent, which 
asserted the Kazakhstani Customs Control Committee requested shipping 
documents and manifests -- standard procedure under Kazakhstani law 
and agreements for the commercial shipment of goods -- for four 
containers destined for Manas.  Post inquired whether the shippers 
had provided the documents, but received no reply.  Post has not 
received any complaints that Kazakhstani Customs have failed to 
process, in a timely fashion, shipments free of bureaucratic and 
clerical errors. 
 
6.  (S/NF) Although the State Department alerted Post via e-mail of 
overflight denials, Post also has traced these issues to clerical 
errors on the part of the U.S. government and its contractors.  On 
January 11, the Deputy Chairman of Kazakhstan's Civil Aviation 
Committee (CAC), Talgat Lastayev, assured Post of continued good 
cooperation and that the CAC has encountered no difficulties relating 
to air-transportation requests, including overflights. 
 
NDN AND OVERFLIGHT REQUESTS PENDING 
 
7.  (S/NF) The Kazakhstani government has repeatedly expressed its 
political will to support U.S. operations in Afghanistan through the 
opening of a U.S. transit center in Kazakhstan and under existing 
overflight and Northern Distribution Network agreements (ref A). 
However, efforts to expand these agreements to include north-south 
flight corridors and military and civilian wheeled vehicles, focused 
on the Mine Resistant Ambush Protected All-Terrain Vehicles (MATVs), 
 
ASTANA 00000052  002 OF 002 
 
 
are stalled due to terrorism and legislative concerns (refs B-E). 
Moreover, according to the Defense Logistics Agency, U.S. contractors 
currently are purchasing only eight products -- with six more 
identified -- in Kazakhstan, out of a list of thousands of items. 
The Kazakhstani government repeatedly has expressed its concern that 
Kazakhstan has exposed itself to the risk of terrorist attacks, but 
has realized very few of the promised benefits to the Kazakhstani 
economy
from local procurement.  Additionally, foreign ministry 
officials have mentioned suspicion that the United States secretly is 
expanding cooperation with Uzbekistan and opening a base there while 
ignoring President Nazarbayev's offer of a transit center in 
Kazakhstan. 
 
8.  (S/NF) COMMENT/ACTION REQUET:  Post recommends that the U.S. 
government provide, under cover of a diplomatic note, a list of 
products that the U.S. government currently procures in support of 
its forces in Afghanistan and that U.S. government contractors could 
potentially procure locally.  In addition, this diplomatic note 
explicitly should allow the Kazakhstani government to use one or more 
Kazakhstani entities to liaise with companies involved in OEF-related 
procurement transactions.  Post requests detailed information on the 
possibility of placing MATVs into containers and other potential 
responses to Kazakhstan's security concerns.  Post also recommends 
provision of additional security assistance, especially along 
Kazakhstan's southern border, which would help address concerns about 
terrorism.  High-level engagement also might help break the impasse 
on the outstanding NDN and overflight requests. 
 
HOAGLAND

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10ASTANA51, KAZAKHSTAN: MEDIA REPORTS ON HUMAN TRAFFICKING CASES

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Reference ID Created Released Classification Origin
10ASTANA51 2010-01-20 03:54 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO2559
PP RUEHIK
DE RUEHTA #0051/01 0200354
ZNR UUUUU ZZH
P 200354Z JAN 10
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 7224
INFO RUCNCIS/CIS COLLECTIVE 2370
RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1732
RUEHKO/AMEMBASSY TOKYO 2438
RUEHUL/AMEMBASSY SEOUL 1348
RUEAIIA/CIA WASHDC
RHEFAAA/DIA WASHDC
RHEHNSC/NSC WASHDC 1928
RUEKJCS/SECDEF WASHDC 1778
RUEKJCS/JOINT STAFF WASHDC
RHMFIUU/CDR USCENTCOM MACDILL AFB FL
RUEHAST/AMCONSUL ALMATY 2201
RUEAWJL/DEPT OF JUSTICE WASHINGTON DC
RHMCSUU/FBI WASHINGTON DC
RHMFIUU/DEPT OF HOMELAND SECURITY WASHINGTON DC 0069

UNCLAS SECTION 01 OF 03 ASTANA 000051 
 
SIPDIS 
 
STATE FOR INL/AAE, G/TIP, SCA/CEN 
 
E.O. 12958: N/A 
TAGS: PGOV ELAB SMIG SOCI KCRM KTIP UZ KZ
SUBJECT:  KAZAKHSTAN:  MEDIA REPORTS ON HUMAN TRAFFICKING CASES 
 
ASTANA 00000051  001.3 OF 003 
 
 
1.  The following is a summary of local media reports of human 
trafficking cases in Kazakhstan September-December 2009. 
 
ANTI-TRAFFICKING OPERATIONS 
 
2. December 14, "Interfax":  During a nationwide anti-trafficking 
operation, December 7-11, police arrested 55 pimps and two 
traffickers and registered 371 prostitutes. 
 
-December 9, Police from the Department of Interior of Kyzylorda 
Oblast arrested a 39-year-old from Zhanakorgan for trafficking in 
minors for purposes of sexual exploitation in saunas and hotels in 
Taraz.  The criminal case is ongoing. 
 
-December 10, Police from the Department of Interior of Zhambyl 
Oblast arrested a 35-year-old from Taraz, who forced Kyrgyz woman to 
work as a prostitute.  The criminal case is ongoing. 
 
3.  September 14, "Interfax", "Kazakhstan Today":  During a 
nationwide anti-trafficking operation, September 7-11, police 
arrested 67 pimps and 14 traffickers and registered 409 prostitutes. 
 
 
-Police from the Department of Interior of West-Kazakhstan Oblast 
arrested three people for attempting to sell an under-aged girl for 
purposes of sexual exploitation for $200.  Police also arrested four 
members of a criminal group for kidnapping minors and forcing them 
to work in hotel saunas in Uralsk. 
 
-Police from the Department of Interior of Zhambyl Oblast arrested a 
25-year-old woman for trafficking a 15-year-old girl from Taraz to 
Almaty, where she was forced to work as a prostitute. 
 
-Police from the Department of Interior of Kyzylorda Oblast arrested 
five teenaged members of a criminal group who forced a 14-year-old 
girl to work as a prostitute. 
 
-An Astana resident was arrested in Kokshetau city for trafficking a 
20-year-old woman for purposes of sexual exploitation. 
 
TWO SEXUAL EXPLOITATION CONVICTIONS IN PETROPAVLOVSK 
 
4.  November 23, "Zakon.kz" from "Kazakhstan Today":  Two women in 
Petropavlovsk were sentenced to five years in prison and their 
property was confiscated for trafficking in persons for purposes of 
sexual exploitation.  The court suspended the sentence of one 
trafficker until her son reaches the age of 14.  According to 
prosecutors, the women came to Petropavlovsk in May 2009 to find 
girls to traffic to Kokshetau. 
 
TAJIKS, UZBEKS, AND KYRGYZ FREED FROM HOTEL BASEMENT 
 
5.  November 16, "Kazakhstan Today," November 18, "KTK":  Police in 
the Almaty Oblast freed 17 young, female trafficking victims who 
were kept in the basement of a hotel for almost two years and forced 
to work as prostitutes.  The women were from Tajikistan, Uzbekistan, 
and Kyrgyzstan and had been promised jobs as waitresses and 
secretaries by an "employment agency."   Three Almaty residents aged 
38, 39, and 19 and their 22-year-old female accomplice were 
arrested. 
 
SEXUAL EXPLOTATION 
 
6.  November 21, "Liter":  Police in the Almaty Oblast arrested a 
group of people who were kidnapping young women for purposes of 
sexual exploitation.  On November 8, the mother of one kidnapped 
woman gave the police the address at which her daughter was being 
held.  The young woman had been kidnapped from the Chemolgan train 
station in the Karasai Rayon.  The investigation is ongoing. 
 
7.  September 18, "Zakon.kz" from "Kazakhstan Today": Police in the 
South Kazakhstan Oblast arrested a 37-year-old-woman named Riza, who 
admitted that she was  involved in trafficking young women from 
Shymkent.  She revealed that she met potential victims on the street 
 
ASTANA 00000051  002.3 OF 003 
 
 
and in cafes and, by means of deceit or threat, trafficked them to 
Turkestan, where she sold them to clients.  She was charged with 
trafficking in persons, kidnapping, illegal deprivation of freedom, 
forcing one into prostitution, and pimping.  In its press release on 
this case, the police also detailed the April arrest in Turkestan of 
a 49-year-old woman for exploiting 14- and 16-year-olds in local 
saunas. The woman was sentenced to five and a half years in prison. 
 
 
ORPHANED TEENAGERS SOLD INTO PROSTITUTION 
 
8.  November 5, "Kazakhstan Today":  North Kazakhstani police 
investigated a trafficking-in-persons case involving four teenagers 
from the local vocational school for orphans, who were allegedly 
sold
by a teacher several months earlier for $1000 and were working 
in the Akmolinskaya Oblast as prostitutes.  This case was uncovered 
when the Department of Education in Petropavlovsk found 20 students 
missing during a routine check.  Of the missing students, all but 
one were 15- and 16-years-old.  Teachers and five accomplices were 
charged with kidnapping and trafficking in minors.  Later media 
reports indicate that one suspect fled to Russia, but was later 
extradited to Kazakhstan. 
 
9.  October 19, "Interfax":  A 27-year-old Kazakhstani woman 
previously charged with trafficking in minors was arrested in 
Russia's Krasnodarskyi Krai during a joint North-Kazakhstan 
Department of Interior-Russian Ministry of Interior organized-crime 
operation. 
 
10.  November 9, "Interfax":  The 27-year-old Kazakhstani arrested 
in Russia was involved in selling orphans in North-Kazakhstan Oblast 
and was extradited to Kazakhstan for further investigation. 
 
KIDNAPPING 
 
11.  December 23, "Express-K":  Police in Astana arrested a 
17-year-old woman for kidnapping a five-month-old baby from a 
married couple from whom she rented a room.  After the parents went 
to bed, the girl abducted the child and stole a cell phone and 
money.  When arrested, she could not explain why she kidnapped the 
child, saying only that she loved children very much.  A 
psychiatrist will examine the woman to determine whether charges 
should be filed. 
 
12.  November 18, "Interfax":  Almaty police officers, working with 
colleagues in Kyrgyzstan, found a five-year-old girl who disappeared 
in September and returned her to her mother.  She was discovered in 
the home of a 20-year-old Kyrgyz woman who had worked as a 
prostitute in Almaty.  The reason for the kidnapping is unknown, and 
the investigation is ongoing. 
 
CHILD LABOR IN COTTON FIELDS 
 
13.  December 4, "Interfax":  The Ministry of Education reports that 
25% of all children in the South-Kazakhstan Oblast were absent from 
the first quarter of the school year because of their work in the 
cotton fields.  Cotton harvesting was classified as a worst form of 
child-labor exploitation under the UN Convention on the Rights of 
the Child.  However, about 900 children aged 7-17 reportedly 
harvested cotton in the South-Kazakhstan Oblast in 2008-2009. 
 
14.  Akim (governor) of South-Kazakhstan Oblast Ali Bektayev called 
cotton harvesting educational and a tradition in his oblast, and 
said he began to harvest cotton at the age of seven.  However, he 
added his opposition to the harvest of cotton during school hours 
despite weather conditions which made it necessary this year.  The 
Minister of Education said that the use of child labor has a 
negative impact on the image of Kazakhstan and recommended 
modernization of the cotton harvest. 
 
LABOR EXPLOTATION 
 
15.  December 23, "Vremya":  A young woman from Shymkent escaped 
captivity in Moscow, where she worked for a family also from 
 
ASTANA 00000051  003.3 OF 003 
 
 
Shymkent.  Unable to find work in Shymkent, her cousin, who had been 
working in Moscow for a year, invited her there with the promise of 
a job in a Kazakhstani-run shop.  Upon arrival, her documents were 
taken, and she was forced to work loading fruits and vegetables 
daily 5:00 AM until midnight.  In addition to the long hours, she 
was poorly fed and regularly beaten.  After her escape, IOM Moscow 
helped her return to Shymkent where the local NGO Sana Sezim 
provided her with medical treatment.  A criminal case was not 
initiated due to a lack of evidence. 
 
16.  September 17, "Vremya":  Police in Pavlodar Oblast investigated 
a criminal case of illegal deprivation of freedom for purposes of 
exploitation.  Nine residents of Sherbakty and an Uzbek citizen were 
forced to work clearing the Chaldai forest.  The Uzbek citizen 
stated that he worked without pay in the forest for two years.  The 
nephew of the local Akim (mayor) owns the company overseeing the 
forest work. 
 
RUSSIA CHECKS BUSES FROM CENTRAL ASIA FOR ILLEGAL MIGRANTS 
 
17.  October 15, "Interfax":  Police in the Moskovskaya Oblast of 
Russia stopped a 45-passenger bus with 116 illegal migrants from 
Central Asia.  The courts likely will deport the illegal migrants to 
their home countries.  During Operations "Illegal Migrant" and 
"Bus," the Russian police stopped 14 buses with illegal migrants 
during one month. 
 
ILLEGAL MIGRANTS 
 
18.  September 4, "Interfax":  During a joint Committee for National 
Security-Prosecutor General's Office in Kostanai operation, 
migration police found 48 Chinese citizens illegally working in a 
local brick plant.  The workers arrived in Kazakhstan on visitor's 
visas two months earlier. 
 
19.  November 4, "Interfax":  Police in Taraz arrested 37 illegal 
migrants from Uzbekistan working on a construction site.  The 
workers arrived on visitor's visas and registered with Kazakhstani 
authorities in the summer, which allowed them to stay in the country 
for up to three months.  Eight workers without documents were placed 
in a detention center pending confirmation of their identities and 
status.  The others are awaiting a court decision on administrative 
fines and deportation.  The construction companies that employed the 
workers will have to pay administrative fines. 
 
KAZAKHSTAN'S MIGRATION CONCEPT AND CIS CONVENTION ON LABOR MIGRANTS 
 
20.  December 21, "Interfax":  Kazakhstan is attempting to prevent 
internal migration problems through the development of a national 
internal migration concept.  Administratively, procedures for 
single-family housing construction permits and residency 
registration would be simplified.  This initiative would also 
eliminate the job application requirement of residency certificates, 
which would make available employment to everyone regardless of 
residence or registration.  Socio-economic measures would develop 
poorer regions through the modernization of the transportation and 
energy infrastructure, education, and medical services.  The 
government would establish temporary housing for homeless internal 
migrants. 
 
21.  December 11, "Interfax":  The Kazakhstani Parliament agreed to 
ratify the Commonwealth of Independent States (CIS) Convention on 
Labor Migrants.  Kazakhstan signed the convention with every CIS 
state, except Turkmenistan and Moldova, in Chisinau on November 14, 
2008.  The convention is expected to reduce the risk of forced labor 
and increase social protections for labor migrants and their 
families. 
 
HOAGLAND

Wikileaks