"USA PLANS TO SHOW AVAILABILITY OF ALTERNATIVE GAS SUPPLY SOURCE TO EUROPE" - Matthew Bryza, Deputy Assistant Secretary of State for European and Eurasian Affairs, USA

 

"I believe overall the Caspian Sea legal status does not hinder laying the Trans-Caspian gas pipeline. If two countries like Azerbaijan and Turkmenistan decide to construct a pipeline across the Caspian Sea and if we know that such a pipeline will cross the territories of these states without being aware of frontiers, this decision will be left up to these two countries", Matthew Bryza, Deputy Assistant Secretary of State for European and Eurasian Affairs, USA said in the exclusive interview to Caspian Energy. 

 

Caspian Energy (CE): Mr. Bryza, to what extent is the US Government ready to support the Trans-Caspian gas pipeline project's implementation?

Matthew Bryza, Deputy Assistant Secretary of State for European and Eurasian Affairs, USA: We are ready to back up the construction of the Trans-Caspian Gas Pipeline (TCGP) as much as the governments of Turkmenistan, Kazakhstan and Azerbaijan are ready to do the same. As far as we know, at the moment the governments of Azerbaijan and Turkmenistan are about to enter negotiations. We support this negotiation process.

 

CE: Is it planned to draw US investments in Turkmenistan?

Matthew Bryza: It is too early to speak about it now because the governments of Azerbaijan, Turkmenistan and the companies are still negotiating. However, if there are US investors or if such a project appears, we are likely to support it, whereas now we do not have such intentions.

 

CE: Does the USA plan to invest in TCGP?

Matthew Bryza: It is early to discuss this question at the moment as well. Perhaps, the US government will make some investments in the project. However, this is just the start of negotiations between Azerbaijan, Turkmenistan and the companies. I do not say we are not going to invest in the Trans-Caspian Gas Pipeline project. But I do not know how the talks will progress as these are still preliminary assessments.

CEI: How would you comment on the document signed by Turkmenistan, Kazakhstan and Russia to regulate construction of the Caspian Littoral Gas Pipeline from Turkmenistan?

Matthew Bryza: I consider it as the statement of intentions. So, according to the statement, the RF is ready to invest funds in this project.

 

CE: Do you regard the Caspian Littoral Gas Pipeline as a competitor to TCGP?

Matthew Bryza: I regard it as a competitor but not as an obstacle for construction of the Trans-Caspian Gas Pipeline. Competition is good. There should be as much as possible competition in the region.

 

CE: Do you agree that the talks on the TCGP construction should be intensified to some extent?

Matthew Bryza: These talks are progressing quite well. I believe we do need to worry about the TCGP project as the document signed by the Presidents of Turkmenistan, Kazakhstan and Russia is a political statement, which concerns other fields in Turkmenistan rather than those that could be involved in the project to ensure natural gas transportation through the TCGP.

 

CE: Do you regard the unsettled Caspian Sea legal status as an obstacle for the TCGP construction?

Matthew Bryza: I believe overall the Caspian Sea legal status does not hinder laying the Trans-Caspian gas pipeline. If two countries like Azerbaijan and Turkmenistan decide to construct a pipeline across the Caspian Sea and if we know that such a pipeline will cross the territories of these states without being aware of frontiers, this decision will be left up to these two.

 

CE: W hat do you think about  the possibilities to recommence gas supplies from Iraq so as to join the Nabucco project? What activities do you plan to carry out with the countries across the region in this regard?

Matthew Bryza: We are interested in Iraq's joining the Nabucco pipeline. Now we are pursuing a certain policy in Iraq to settle this issue. First if all, we need time to achieve the target. We want to interest investors to invest in the Iraq's infrastructure. Afterwards we plan to draw up a programme to ensure development of the power industry in the country. At the moment we are consulting with Turkey. For instance, the tripartite meeting between the representatives of the USA, Turkey and Iraq was held in March 2007 to identify what should be done to implement it. More meetings are due to be held in the near future. It is necessary to involve international companies in operating in Iraq.

However, one should not say the Iraq's infrastructure is destroyed. It just requires investments to get improved as there are some problems related to safety of the Iraq's energy infrastructure.

We also welcome the intentions of the Russian companies to work as partners in Iraq. The key objective today is to establish such cooperation.

 

CE: What is your opinion about possible routes of Middle Asian gas transportation to Europe?

Matthew Bryza: Following the assessments of international companies, the cost of transportation of 1 million BTU (from editors: British Thermal Unit (BTU) is the amount of heat required to raise the temperature of one pound of water (453.59 grams) by one degree Fahrenheit) of Middle Asian gas from Azerbaijan to Europe via Nabucco is by 20% more efficient than through Blue Stream (see the map).

Speaking of gas transportation from Turkmenistan to the RF and from there via Blue Stream to Turkey including Nabucco, gas export through Azerbaijan appears to be economically more expedient (by 50%). In other words, the operation of the South Caucasian Gas Pipeline (SCP) and its connection to the Nabucco project in view of ensuring gas transportation to Europe is economically expedient and has a very important role from the point of view of ensuring energy security of Europe. In figures, transportation of 1 million BTU the operation of the South Caucasian Gas Pipeline (SCP) and its connection to the Nabucco project in view of ensuring gas transportation to Europe is economically expedient and has a very important role from the point of view of ensuring energy security of Europe. In regard of figures, transportation of 1 million BTU of Middle Asian gas from Azerbaijan to Austria will come to $2.5, whereas transporting gas to Europe through the Caspian littoral pipeline and from there via the Blue Stream pipeline operated by Gazprom grows by 20% and comes to $3", said Matthew J. Bryza. "This is a very good margin, why not using it?

Favourable conditions for competition will be created after launching Azerbaijani gas export through the Baku-Tbilisi-Erzurum gas pipeline along with appearing of new gas exporters to Europe, including those from Iran, Turkmenistan and Kazakhstan. However, it does not mean we want to push Gazprom out of Europe. I mean just meeting the growing gas demand in Europe. We target good market relations with Russia and plan to achieve it through commercial competition.

The USA has no intentions to compare any countries. The USA just wants to show availability of an alternative gas supply source to Europe. We do not want any confrontation with Russia and Gazprom. We want the parties to cooperate through competition. We do not push out anybody from the market, we just show the advantage of diversified routes.

Now Gazprom is the main and reliable gas supplier for Europe. Gazprom has been one of the major gas suppliers to Europe for 20 years. Now there is a necessity to upgrade this network as it has not been convenient for the consumers of this system.

Thank you for the interview