The US will not soften its limitations on trade with Iran until that country addresses concerns about its accumulation of weapons of mass destruction and its support of international terrorism, said Ambassador Stephen R. Mann, senior advisor for Caspian basin energy diplomacy within the US Department of State, Jan. 10 in Houston.
Mann was part of a panel discussion of US policy in Central Asia, with emphasis on energy development around the Caspian Sea, sponsored by ENI SPA and Brace & Patterson LLP. Although reporters were invited to that session, officials approved Mann's request to take most of his speech off the record. "Otherwise, you're going to hear a dull talk," he warned.
But in response to a question from the audience, Mann said those who point to some softening of political policies within Iran "must look for changes on the issues that concern the US before there will be a change in US policy." Energy companies hoping to do business in Iran sometimes overestimate the degree to which new government leaders in that country have altered hardline political policies, he said.
In addition, one of the panel of four speakers said the US is consistent in its policy favoring multiple pipelines to export oil and natural gas from the Caspian Sea area to world markets-excluding an Iranian route. Kazakhstan officials proposed three pipeline routes to export Caspian crude, but US Sec. of State Colin L. Powell "took one [that would have gone through Iran] away," the speaker said.
At a Dec. 9 meeting with Powell, Kazakhstan President Nursultan Nazarbaev urged the US to consider the Iranian route as the most direct and cost-effective means of moving Caspian oil and gas into world markets. But in a later visit to Houston, Nazarbaev seemed to play down that proposed route (OGJ Online, Dec. 20, 2001). However, the same panel member also said nothing must interfere with development of the proposed Baku-Tbilisi-Ceyhan (BTC) oil pipeline from Azerbaijan through Turkey to the Mediterranean Sea (OGJ, Jan. 14, 2001, p. 60).
Industry sources report the future growth of petroleum liquids production in Azerbaijan depends heavily on the sanction and construction of that high-profile export pipeline. If BTC is operational by 2005, the Azeri-Chirag-Guneshli upstream project should realize its full potential, increasing Azerbaijan's liquids production nearly fourfold to more than 1.1 million b/d in 2010, sources said (OGJ, Dec. 24, 2001, p. 22).
The panel member also said US government opposition to the dominance of Caspian gas exports by OAO Gazprom, Russia's state natural gas company, "is an antimonopoly issue, not an anti-Russian issue."
As provider of the only gas pipeline available for that region, Gazprom has not allowed Caspian gas exports to reach outside markets through Russia. Previously, Gazprom did not want Caspian natural gas to compete with Russian gas in profitable European markets.
But industry sources say Gazprom now wants to buy Caspian gas and resell it in Europe in lieu of charging tariffs for use of its pipelines.
