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Cablegate: Eu-Turkey Energy Conference - Missed Opportunity On

VZCZCXRO6587
RR RUEHAG RUEHDBU RUEHDF RUEHIK RUEHLN RUEHLZ RUEHROV RUEHVK RUEHYG
DE RUEHAK #1535 1661312
ZNR UUUUU ZZH
R 151312Z JUN 07
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 2614
INFO RUCPDOC/USDOC WASHDC
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RUEHGB/AMEMBASSY BAGHDAD 0968
RUCNCIS/CIS COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHIT/AMCONSUL ISTANBUL 2884
RUEHDA/AMCONSUL ADANA 2046

UNCLAS ANKARA 001535

SIPDIS

USDOE FOR CHARLES WASHINGTON
USDOC FOR 4212/ITA/MAC/CPD/CRUSNAK

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ENRG EPET EINV TU
SUBJECT: EU-TURKEY ENERGY CONFERENCE - MISSED OPPORTUNITY ON
TRANSIT

REF: Ankara 1481

Sensitive But Unclassified. Please handle accordingly.

1. (SBU) SUMMARY: Expectations for a strong European statement in
support of Turkey's role in gas transit to Europe were unrealized at
the June 5 "Turkey and the EU: Together for a European Energy
Policy" Conference in Istanbul, which was attended by Commissioners
Rehn and Piebalgs and senior GOT officials. While there were
political statements of support for Turkey's EU accession, Turkey's
critical role in the "southern gas corridor" to Europe was not
showcased. End Summary.

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2. (SBU) Nazim Bayraktar from the Energy Regulator EU Relations
Department described the EU-Turkey energy conference as a political
love-fest. A particularly quotable comment was Olli Rehn's
reference to Turkey's EU accession as music that cannot stop: "it
can be a quick samba, or it can be a slow waltz." Turkish chief EU
negotiator State Minister Ali Babacan said "Turkey will be relegated
to the status of a third world country" unless it applies EU
standards of democracy and rule of law.

3. (SBU) Bayraktar said that Energy Minister Guler used his speech
to emphasize energy cooperation, plugging Samsun-Ceyhan, Nabucco and
other transit projects. He high-lighted Turkey's desire for access
to gas transiting its territory at "net-back" prices, so that Turkey
is assured some quantity of gas at a price equal to that paid by the
downstream consumer less transportation costs. Guler often
complains that the Europeans do not give adequate consideration to
Turkey's significant and growing gas requirements (ref). Bayraktar
also said that exemptions to EU regulations on third party access
and tariffs were necessary to realize Nabucco, but an
inter-governmental agreement could facilitate or obviate the
exemption issue.

4. (SBU) In his speech, Energy Deputy Undersecretary Bekir Aksoy
reportedly said Turkey was continuing to work on legislation aimed
at advancing Turkey's adoption of the EU energy acquis. He cited
electricity sector reform, renewable and energy efficiencies laws,
and draft petroleum and nuclear laws. While EU officials applauded
Turkey's efforts, there was not a commitment on when the energy
chapter negotiations might be opened.

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Missed Opportunity
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5. (SBU) UK Embassy energy officer was disappointed, however, that
EU officials did not take the opportunity to emphasize Turkey's gas
transit role. While there was perfunctory mention of gas transit in
the conference conclusion and a number of speeches, the clear focus
of the conference proceedings and reporting was on political support
for Turkey's EU accession. The UK embassy officer felt that the
Commission spent too much time hammering Turkey to join the European
Energy Community Treaty, which Turkey has not signed because it
wants to take advantage of the accession period to adopt energy and
environment acquis. The British diplomat shared a copy of the
letter from the UK Minister of Europe to the Commission which
advocated using the conference as a catalyst to increase EU
engagement with Turkey and the Caspian, in particular Turkmenistan,
on advancing a trans-Caspian pipeline supplying gas to Europe.

6. (SBU) COMMENT: Both our Turkish and European interlocutors see
a link between Turkey's EU accession and its role as a natural gas
transit country and seek to play the issues off each other. The
Turks argue that the EU should be more welcoming on accession in
order to obtain Turkey's cooperation on energy, while the Europeans
see it the other way around. This zero-sum thinking is clearly
self-defeating. We will need to continue to challenge the Europeans
to be more visible and focused on Central Asia and Caspian -sourced
gas transiting Turkey to Europe.
Wilson

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