Six ambassadorsA couple of years ago, the Caspian Sea region seemed to be the last great oil frontier.
Now international oil companies view the Caspian less optimistically, after the plunge in world oil prices, some exploration failures, and continuing political problems.
But the U.S. State Department is convinced the region still has great promise.
To get that view publicized, it and the U.S. Trade and Development Agency (TDA) recently sent six U.S. ambassadors on a tour that touched down in New Orleans, New York City, and Washington, D.C.
In the tour, the U.S. ambassadors to Azerbaijan, Armenia, Kazakhstan, Turkmenistan, Uzbekistan, and Georgia and their senior commercial aides outlined about 200 energy, transportation, water supply, and other business opportunities in the six nations.
High potentialJoseph Grandmaison, TDA director, said the Caspian region has an estimated 15-32 billion bbl of proven oil reserves and 236-337 tcf of proven gas reserves.
He said possible reserves are more than 140 billion bbl of oil and 3,000 tcf of gas.
Grandmaison outlined the status of the proposed oil export pipelines and said, "With each of these pipelines and with current oil and gas developments, there are billions of dollars of opportunities that will be open to U.S. businesses in many sectors.
"Overall, we see $8-9 billion in investment and export opportunities for U.S. businesses in the region during the next several years. The opportunities (include) more than $5 billion in the oil and gas sectors, over $2 billion in the power sector, nearly $1 billion in the transportation sector, and hundreds of millions of dollars in the telecommunications, agriculture, tourism, utilities, environment, and health sectors."
Country viewsStanley Escudero, ambassador to Azerbaijan, said that, despite lower world oil prices, companies are still interested in oil investments.
"Azerbaijan is not an easy place to do business, but you can make a hell of a lot of money if you persevere, if you meet the people, and if you are capitalized."
Along similar lines, Richard Jones, ambassador to Kazakhstan, noted that Kazakhstan "is not a market for the fainthearted." But he said that about a hundred U.S. companies are doing business there.
Jones predicted, "The key to economic development in Kazakhstan in the future will be the development of multiple export pipelines."
Steve Mann, ambassador to Turkmenistan, said that that government is still "addicted to centralized control" and its president makes "the final decision on all major, many medium, and some small issues."
Mann said, "As we draw closer to construction of an export pipeline, opportunities for U.S. firms will magnify."
Michael Lemon, ambassador to Armenia, said regional economic integration is essential if the Caspian is to attract the tens of billions of dollars of investment it needs to reach its full potential.
"Individually, none of the Caucasus countries is large enough in itself as a market to offer the economies of scale that normally make major industrial investment attractive."
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