> >
Energy and Politics: A Resource Page
in support of NYUAD course, "
Energy ... and Politics" [GO]

© KIMBALL FILES

Table of Contents
GLOSSARY = Places | Energy types | Integration | Energy measures | Technical terms | Institutions | Corporations |
CHRONOLOGY =

  0* Before Petroleum Era: Coal, Whale Oil, etc.
  1* 1870+:Rise of Nobel, Standard, Shell and BP
  2* 1901+:First Big Petroleum Concessions
  3* 1911+:Breakup of Standard Oil
  4* 1914+:Energy in World War One Era
  5* 1928+:Achnacarry Agreement
  6* 1935+:Energy in War Two Era
  7* 1944+:Energy in Early Cold War Era
  8* 1953+:Iran = US Senate and CIA Take Different Paths
  9* 1960+:Organization of Petroleum Exporting Countries
10* 1974+: US Senate and the Oil Crisis
11* 1992+: USSR Collapse & Big Oil move into Caspian region 
12* Russian Petroleum Oligarchs & Post-Soviet Domestic Politics
13* Energy and Domestic Politics in Nigeria and Venezuela
14* China Joins the Fray
-- People's Republic of China and the Russian Federation
-- Russia offers to buy BP's $30 billion JV stake
15* Environmental Considerations
BIBLIOGRAPHY
Boneyard (Where you SEEK when you don't FIND on this webpage)

 

GLOSSARY of Acronyms used on SAC energy pages
[ Common Kimball-Files acronyms = bbl.BYD | SAC/GLOS |
A list of "Key Concepts" and their codes is a separate webpage

 

Places

*2006:Top World Oil Producers, Exporters, Consumers and Importers [W]
*2007:Greatest Oil Reserves [rzv~], by Country [W]

|>AFG = Afghanistan
|>AFR = Africa [Klare.Rising=146-76]
|>ALG = Algeria [Wiki#1 | Wki#2]
|>AMC = Americas, Central & South|>C.AMC|>S.AMC|>N.AMC=North [BUT coded here usually as USA or CAN],
|>BHR = Bahrain [Wki | W#1]
|>BLK.S = Black Sea
|>BMH = Burma(h) G/Myanmar
|>BRZ = Brazil [Wki | W(ofc.ANP site) ]
|>C.ASA = Central Asia [Wki | MAP]
|>CAN = Canada [Wki#1 | Wki#2]
|>CSP.S = Caspian Sea [W(ofc EIA site)]
|>CHN = China [Klare.Rising=63-77,82-7,132-7,171-4,194-201] [W#1]
|>CYN = Ceyhan, TRKw port [G/CYN.ptpt prj], terminal of great ptpt prj to freeze RUS out
|>CLM = Columbia
|>EGP = Egypt [W#1]
|>ENG = England, centered in LND, the metropol ruling over three other long-time peripheries (Wales, IRE & SCT) G/UK
|>IND = India [Klare.Rising=77-87] [Wki]
|>IRN = Iran [Wki]
|>IRQ = Iraq [Wki]
|>KRD = Kurd, Kurdistan
|>KYR = Kyrgyzstan
|>KWT = Kuwait [Wki]
|>KZX = Kazakhstan [Wiki#1 | Wki#2]
|>LBY = Libya [W#1]
|>MLI = Mali
|>MLZ = Malaysia
|>MMR = Myanmar [Burma(h)] [Wki | W#1]
|>MRC = Morocco [W#1]
|>MXO = Mexico [Wki]
|>NDN = Indonesia [F/Aceh]
|>NGR = Nigeria [Wki]
|>PKS = Pakistan
|>QTR = Qatar
|>RUS = Russia
|>SaA = Saudi Arabia
|>SSR = USSR| Union of Soviet Socialist Republics (1921-1991)
|>SYR = Syria
|>TKM = Turkmenistan
|>TLN = Thailand
|>TRK = Turkey
|>Twrl = Third World [ID]
|>GBR = United Kingdom of Great Britain and Northern Ireland [W#1] G/UK/ G/ENG/
|>USA - United States of America
|>VNZ = Venezuela [Coll.Private:408-34(ch19)]

Ross.Oil offers "Country Abbreviations" (N=170) AFG = Afghanistan ALB = Albania DZA = Algeria |>AGO = Angola ARG = Argentina ARM = Armenia AUS = Australia AUT = Austria AZE = Azerbaijan BHS = Bahamas |>SDN = Sudan [too many to rearrange w/code before full name, so = ]

Bahrain = BHR Bangladesh = BGD Barbados = BRB Belarus = BLR Belgium = BEL Belize = BLZ Benin = BEN Bhutan = BTN Bolivia = BOL Bosnia = BIH Botswana = BWA Brazil = BRA Brunei = BRN Bulgaria = BGR Burkina Faso = BFA Burundi = BDI Cambodia = KHM Cameroon = CMR Canada = CAN Cape Verde = CPV Central African Rep. = CAF Chad = TCD Chile = CHL China = CHN Colombia = COL Comoros = COM Congo, Dem. Rep. = ZAR Congo, Republic of = COG Costa Rica = CRI Côte d’Ivoire = CIV Croatia = HRV Cuba = CUB Cyprus = CYP Czech Republic = CZE Denmark = DNK Djibouti = DJI Dominican Republic = DOM Ecuador = ECU Egypt = EGY El Salvador = SLV Equatorial Guinea = GNQ Eritrea = ERI Estonia = EST Ethiopia = ETH Fiji = FJI Finland = FIN France = FRA Gabon = GAB Gambia = GMB Georgia = GEO Germany = DEU Ghana = GHA Greece = GRC Guatemala = GTM Guinea = GIN Guinea-Bissau = GNB Guyana = GUY Haiti = HTI Honduras = HND Hungary = HUN Iceland = ISL India = IND Indonesia = IDN Iran = IRN Iraq = IRQ Ireland = IRL Israel = ISR Italy = ITA Jamaica = JAM Japan = JPN Jordan = JOR Kazakhstan = KAZ Kenya = KEN Korea (North) = PRK Korea (South) = KOR Kuwait = KWT Kyrgyz Republic = KGZ Laos = LAO Latvia = LVA Lebanon = LBN Lesotho = LSO Liberia = LBR Libya = LBY Lithuania = LTU Luxembourg = LUX Macedonia = MKD Madagascar = MDG Malawi = MWI Malaysia = MYS Maldives = MDV Mali = MLI Malta = MLT Mauritania = MRT Mauritius = MUS Mexico = MEX Moldova = MDA Mongolia = MNG Morocco = MAR Mozambique = MOZ Myanmar = MMR Namibia = NAM Nepal = NPL Netherlands = NLD New Zealand = NZL Nicaragua = NIC Niger = NER Nigeria = NGA Norway = NOR Oman = OMN Pakistan = PAK Panama = PAN Papua New Guinea = PNG Paraguay = PRY Peru = PER Philippines = PHL Poland = POL Portugal = PRT Qatar = QAT Romania = ROM Russia = RUS Rwanda = RWA Saudi Arabia = SAU Senegal = SEN Serbia = YUG Sierra Leone = SLE Singapore = SGP Slovak Republic = SVK Slovenia = SVN Solomon Islands = SLB Somalia = SOM South Africa + ZAF Spain = ESP Sri Lanka = LKA Suriname = SUR Swaziland = SWZ Sweden = SWE Switzerland = CHE Syria = SYR Taiwan = TWN Tajikistan = TJK Tanzania = TZA Togo = TGO Trinidad = TTO Tunisia = TUN Turkey = TUR Turkmenistan = TKM Uganda = UGA Ukraine = UKR United Arab Emirates = ARE United Kingdom = GBR United States = USA Uruguay = URY Uzbekistan = UZB Venezuela = VEN Vietnam = VNM Yemen = YEM Zambia = ZMB Zimbabwe = ZWE

|>nrg.ggr = Energy, general locations F/.grr/ EG=B.nrg.ggr
|>nrg.p.ggr = Field, oil field|
|>nrg.g.ggr = Field, natural gas field [Coll.Private:582-90 | Klare.Rising=43-49]

|>nrg.c.ggr = Field, coal field|>grn = mine
|>ntn & |>ntn.stt = Nation-state, nation in plt/institutional sense rather than in ethnographic sense| CF=stt.ndp
|>wtpt.ggr = seaport [ W-MAP | W-LIST(includes river ports) | World Seaports ]

 

Energy Types|>nrg

|>nrg.a = whale oil
|>nrg.b = wood
|>nrg.c = coal [Klare.Rising=49-55]
|>nrg.e = electric
|>nrg.f = fossil fuels |>fsf
|>nrg.g = natural gas
|>nrg.gl = liquified natural gas
|>nrg.h = hydro
|>nrg.hs = steam
|>nrg.ht = tidal
|>nrg.k = kerosene
|>nrg.new = alternative energy sources, some new (some renewed) [(nrg.e) nrg.s nrg.t (nrg.x) nrg.z]
|>nrg.o = nrg.p
|>nrg.p = petroleum or oil
|>nrg.pc = crude oil
|>nrg.ps = shale oil, available through "fracking" [frk]
|>nrg.s = solar [WkI#1 | Wki#2 | GrowSolar | DOE "SunShot" prg | Yale Univ. prg | ]
|>nrg.t = geothermal
|>nrg.w = nrg.z
|>nrg.x = nuclear energy, Atomic energy [Klare.Rising=49-55]
|>nrg.z = wind,"zepher" [CPE:436-50]

Integration, vertical and horizontal =

|>u&d = vertical integration, “upstream & downstream” =

|>l&r = horizontal integration, “left & right”, ggr expansion, spanning & drawing together regions & other cmp~ or crp~ [CF=cxx (Cartel) | mpy (Monopoly) | snd (Syndicate) | vs-fdu (Anti-trust org or ddd) ]

 

Energy volumes =

|>bB.nrg.p = billion barrels of oil
|>bBd = billion barrels of oil per day
|>bcF = billion cubic feet
|>bcM = billion cubic eters
|>bT = billion tons
|>cF = cubic feet
|>cM = cubic meters
|>mB.nrg.p = million barrels of oil
|>mBd = Million barrels of oil per day
|>mcF = million cubic feet
|>mcM = million cubic meters
|>mT = million tons<>1971
|>tB.nrg.p = trillion barrels of oil
|>tcF = trillion cubic feet
|>tcM = trillion cubic meters

Technical Terms =

|>ADR = American Repositary Receipts [ID]
|>bdg = construction

|>cns = concession| "investorwords.com" defines cns as an agreement made between a country [IE=a "sovereign" nation-state] and a foreign corporation. "The country offers incentives, such as reduced taxes and other 'concessions', to the corporation in exchange for the corporation investing in that country." No mention of a significantly different sort of cns in which corporations offer incentives (often "bribes") to country authorities (characteristically leaders of a "developing country") in order to take charge of certain domestic enterprises

|>cvc.pbl = Civil Society [ID]

|>cxx = cartel, collusions for price fixing, kickbacks (strictly speaking among companies that should be competing, but also among other institutions, EG=governments)| Often secret

|>ecx = ecology, environment, "climate change", green-house gasses, etc [Klare.Rising=59-62]

|>EEE = SUSTAINABILITY, expressed with the "Three Es" that constitute sustainability ~~ (1) Environment ecx (ggr), (2) Equity [justice] (pbl) and (3) Economy (ekn) [Wki]

|>fdu = fiducia, trust, specifically trust in economic market places| The famous giant "trusts" of the late 19th century were in offense of traditional fiduciary trust. These giant "trusts" in no essential way represented fiducia [ F/vs-fdu.lwx/ | SAC#1 | SAC#2 ]

|>hst.gph = Historiography. . The manner in which the story of energy and politics is told. Authors’ “point of view” and larger sense of significance. What is the story really about? Bias. Critical mindedness. Level of generalization or detail. Closeness to identified sources, especially sources that could be checked by readers, by us

|>IREV = Islamic revolution [CF=EREV AREV FREV RREV]

|>MIC = Military-industrial complex [Klare.Rising=210-37]

|>mlf = Malfeasance, corruption| A difficult term to define, possibly not a "technical" term at all| Laurence Cockcroft, Global Corruption: Money, power, and ethics in the modern world (2012) helps bring some clarity. Whether centered in government or companies, corruption follows from when those who hold offices or managerial positions convert these political or economic institutions and/or "businesses" into private property and personal enterprise. Whether the property of public or governmental agencies or of private companies or inviduals, resources that are held in "trust" [F/fdu/] experience corruption when they are treated as personal economic opportunity, if not exclusively private property. [In the history of political institutions, this threatens a reversal of one of the key accomplishments of European Enlightened politics = Public offices were not to be the possession of those who hold them.] In this sense, Cockcroft is aware that governments and businesses are equally capable of becoming corrupt. Public wealth ("the wealth of nations", pbl.wlt) is converted into, or diverted to, the production of private wealth (prv.wlt). Cockcroft emphasizes how prevalent mlf is in the global energy sector, and he highlights NGR in the 1990s, Alberto Fujimori's Peru and Suharto's NDN. However, Cockcroft surprises us when he points out that mlf does occasionally have broad ekn benefits for the larger community, however ethically or legally or morally reprehensible it might be. Does ekn benefit trump all other considerations? Corruption seems deeply embedded in the modern globalized economy. What's to be done? Cockcroft has five answers (1) strengthen regulation, (2) abolish secret arrangements (tax hideaways, offshore accounts), (3) stamp out bribery, (4) intensify efforts against organized crime, and finally, a capstone measure, (5) make mlf an offense against civil liberties or human rights, a form of international crime, and put it under the jurisdiction of the ICC [ID]. Global cooperation and enforcement are essential. Zoe Cormack in a review of Cockcroft [*2013se27:TLS:25] criticized the optimism, if not naiveté, of this account. But, in truth, "law and order" can be supported strongly by those who are certain that criminality will never be fully eradicated. One need not be naive to think that malfeasance can be brought under satisfactory control.

|>prj = project

|>rebdg = Reconstruction, IRQ Reconstruction, a major USA policy goal, after years of HsnSdm but mainly after "shock & awe" destruction| Is there a relationship w/ Reconstruction in occupied South after USA Cvl.wrx [Wki]? CF="Carpetbaggers" [Wki]

|>rzv~ = Reserves, oil reserves, proven |>p.rzv~ [Wki] Strategic rzv~ |>str.rzv~ | CF=Reservoir|>rsv

|>stt& = Governments or state power AND... [ID] F/stt&/ for all such | >stt&ekn >stt&crp stt&pbl| CF=ntn & CF=cvc.pbl

|>tntn = transnational, international, global, world-wide| Usually "multinational" means tntn
|>vs-fdu.lwx = Sherman Anti-Trust Law [Wki]

INSTITUTIONS [>tUt]
Domestic and international
governmental and corporate tUt~ and
administered facilities and learned tUt~,
as well as certan large and durable "private" orx~

|>AE.tUt <>American Enterprise Institute| vs-clm.qng scs, coordinated w/API & ExxM.crp.nrg [Coll.Private:84-6]

|>API <>American Petroleum Institute| a{}n{}o{
}r{
Homepage |>API.Facts = srl.pbc [Greene.Strategies]
}s{}t{}8{}

|>Crl.grp <>Carlyle Group ["private equity firm" MIC & nrg]| n{}o{}s{Wki | Bloomberg | NYT | G/Briody.Iron
}t{}8{}

|>cxx <>Cartel-like collusions for price fixing, kickbacks (strictly speaking among cmp~ that shd be competing, but also among other jurisdictional institutions, EG=governments)| Often secret but, as in the case of OPEC agreement about oil producing nations [ID], very open and global| CF=snd ~~ vs-fdu mvt

|>GrP <>Greenpeace [Homepage | International.homepage]

|>B.nrg.ggr <>Harvard University Belfer Center Geopolitics of Energy Project|

<>Heritage Foundation|Homepage F/Energy/ | ((nrg.new))

|>IEA <>International Energy Agency [W]
|>IMF <>International Monetary Fund [W] [Wki] [CF=WoB]
|>IRN.cns.snd <>Iran Concessions Syndicate Limited
|>mpy <>Monopoly

|>MPRI <>Military Professional Resources International [W]| n{}o{}f{*2012:bcm Engility [W]
}s{Coll.Private:147-8,295-6 ~~ExxM.crp.nrg
}s{}t{}

|>NOAA <>National Oceanic and Atmospheric Administration [W] [Coll.Private:122-36 Prince William Sound nvs]
|>NRDC <>Natural Resources Defense Council [Homepage]
|>Oil.unx <>Oil field workers' union

|>OPEC <>Organization of Petroleum Exporting Countries| n{}o{ A cartel [ID] of nation-states with oilfields [nrg.p.ggr] containing major oil reserves [rzv]
}f{

Kaufman.Oil:104-14| "Epilogue: OPEC and the Majors [IE=major oil companies, EG="Seven Sisters"(ID)]"

Although it might be too much to posit a totally interdependent relationship between American oil policy and the growth of OPEC, there seems little doubt that the two were related. By 1960 the oil-producing countries had learned enough about cxx and oligopolistic politics to bind themselves together into a cxx. By taking advantage of the world's hunger for oil (which by the beginning of the 1970s was already leading to spot shortages) and opening new fields to independent pmpers in LBY, OPEC was able to break [Big.crp.nrg AfroAsia=] the control over Mideast oil that the oil majors had enjoyed since the 1920s and to replace it with OPEC's own organization. Although the power of OPEC was not fully realized until the Arab oil embargo of 1973, the turning point insofar as OPEC's development was concerned was the LBYn oil settlements of 1970. By playing the independents off against the majors, LBY gained substantial increases in its oil revenues and established a pattern for other nations to follow.

OPEC was organized in Baghdad in September 1960 in response to declining prices for Mideast oil. The original members—SaA, Iran, Iraq, KWT, and Venezuela—resolved that they could "no longer remain indifferent to the attitude heretofore adopted by the oil companies in effecting price modifications." Over the next ten years OPEC was able to establish a revenue floor for Mideast oil that rose from $0.80 a barrel at the beginning of the 1960s to slightly below $1.00 a barrel at the end of the decade.2

Meanwhile, LBY, which joined OPEC in 1962, [ndp.crp.nrg vs-Big.crp.nrg] opened its new oil fields to independents and majors. By the middle of the 1960s the LBYn-based independents represented a real competitive threat to the majors; of the 1.2mBd pmped in 1965, the independents produced nearly 46 percent. Friction developed between them and the majors over LBYn pricing policies. The majors were more willing than the independents to accept increases for oil because they were less dependent on LBYn supplies than the independents and, unlike them, did not have to sell oil at cut-rate prices to European refiners. Moreover, the independents sought the rapid expansion of LBYn oil production and the majors wanted a more moderate development, faced as they were with huge production commitments in their AfroAsia cns~.3

In September 1969 a new regime came to power in LBY following a successful coup [QadM] led by Colonel Muamer Qaddafi. Immediately the Qaddafi regime sought to extract more revenue from the oil pmpers by inviting new foreign firms to Tripoli to discuss LBYn oil cns~. At the same time, LBY ordered a production cutback by Occidental Oil, which was almost totally dependent on LBYn oil for its foreign production. Occidental tried to resist LBYn pressure by turning to Exxon for replacement oil at little more than cost. However, Exxon refused to sell to Occidental at less than the market price, claiming, appropriately enough, that by the consent decree of 1960 it was forbidden to sell oil to one company at a lower price than it sold it to others. On this basis Occidental felt it had no choice other than to try to reach the most favorable agreement possible with LBY. In September 1970 Occidental signed an agreement with LBY that raised the price of oil 30 cents a barrel and an additional 2 cents a year for five years and also increased the income tax rate from 50 to 58 percent.4

Occidental's agreement with LBY started a chain reaction, as other independents also agreed to new, more costly terms with LBY. This situation placed the oil majors and some of the larger independents in a difficult position. Although in the past the oil majors had accepted some increase in the price of LBYn oil, they were not prepared to accept such a rise as LBY now demanded. The majors were forced with two unpleasant choices. They could refuse new terms, which could lead to loss of their cns~ in LBY, or they could meet LBYn demands, which in all likelihood would lead to similar demands by the other oil-producing countries; in other words, an increase in LBYn prices would "leapfrog" into the PER.G countries. After unsuccessfully seeking government support against LBY, the oil companies gave in to its demands, and by September 30 virtually all the companies had agreed to large increases in prices and a rise in the income tax rate from 50 to 55 percent.5

As the oil companies feared, the LBYn price increase leapfrogged across the PER.G and all the other oil-producing countries demanded large increases in price for their nrg.pc oil and a rise in their income tax structure. Meeting in Caracas, Venezuela in December 1970, OPEC established a Committee of the Gulf Producing Countries (the Gulf Committee) consisting of the oil-producing countries in the PER.G. OPEC demanded that the oil companies begin negotiations for a new oil agreement with the Gulf Committee in Teheran within thirty-one days. Even before negotiations began, however, LBY demanded additional price and tax increases and a large freight premium.6

The oil companies responded by seeking joint action against OPEC through a joint negotiating front. As Sir David Barren of Shell remarked later to the SNT.MC, "Our Shell view was that the avalanche had begun and that our best hope of withstanding the pressure being exerted by the members of OPEC would lie in the companies refusing to be picked off one by one in any country and by declining to deal with the Producers except on a total global basis."7

Acting in concert, the oil majors notified OPEC that they could not "further negotiate the development of claims by member countries of OPEC on any other basis than one which reaches a settlement simultaneously with all producing governments concerned." At the same time, the companies that enjoyed cns~ in LBY agreed to supply replacement oil at cost to any company forced by LBY to cut back production.8

Although the oil companies had been concerned about the legality of such joint action under the vs-fdu.lwx~, the Justice Department issued "Business Review Letters" to John McCloy, who represented the companies, which stated that the Department of Justice did not plan to institute antitrust proceedings either with respect to the message to OPEC or to the producers arrangement concerning LBY. This action gave the oil companies wide latitude in working out agreements relative to the Mideast position. As a Senate report on multinational oil companies commented, "In effect... the Business Review Letters insulated the companies from the possibility of antitrust prosecution by the U. S. Government as a consequence of any activities they might undertake pursuant to their agreements."9

To strengthen their position still further McCloy and the chief executives of the major oil companies met with Secretary of State William Rogers and Undersecretary of State John Irwin, III on January 15,1971, to discuss the possibility of sending a high-ranking stt.dpt official, such as Irwin, to negotiate with the OPEC nations on behalf of the oil companies. This was agreed to, and Irwin was sent to the Mideast with instructions to prevent an impasse between OPEC and the oil companies and to seek assurances of a continued supply of oil at reasonable prices. About the same time the major oil companies organized a London Policy Group to formulate overall policy regarding forthcoming negotiations with OPEC in Teheran and LBY. A corresponding group was established in New York, which also supplied London with technical information and expertise on matters such as freight and transportation questions and on legal problems that might arise in negotiation with the OPEC nations.10

What might have happened had the oil companies, backed by Washington, been able to maintain their united front against the OPEC nations is now a moot question because, as the Senate Subcommittee on Multinational Corporations has commented, the strategy devised by the oil companies "did not withstand its first test." The Irwin Mission to the Mideast was a colossal failure. Under the prodding of the Shah of Iran -- who insisted upon separate oil negotiations for the Gulf-producing countries but who also promised not to demand more favorable terms such as those that might be worked out with other producing countries (namely LBY) -- Irwin and the American Ambassador for Iran, Douglas MacArthur, agreed to recommend to the stt.dpt separate negotiations with the Gulf countries. The stt.dpt concurred in this recommendation without even consulting oil industry representatives. In this way, the united front that had been put together so meticulously by the oil companies and the stt.dpt came apart. Furthermore, the Gulf Committee showed that it could drive a wedge between industry negotiators and the United States government.11
THE OIL CARTEL CASE
Oil industry representatives opened talks with the PER.G nations in Teheran and with the LBYn government in Tripoli at the beginning of 1971. At first the industry negotiators attempted to follow a policy of separate but necessarily connected talks whereby any negotiated settlement would have to be acceptable to all interested parties, thus eliminating the possibility of leapfrogging. In other words, while agreeing to separate talks, the oil industry wanted one comprehensive proposal for all producing nations. Once more, however, the oil industry had to backtrack as the producing nations rejected its proposal. Instead, the Gulf Committee demanded that substantive negotiations with it begin immediately, and LBY made it clear that it would not open its negotiations until the Teheran talks were concluded.12

After several deadlocks in the negotiations with the Gulf Committee the oil industry completed an agreement with it on February 14,1971. The agreement provided for an average increase of 30 cents a barrel of oil immediately, escalating to 50 cents by the termination of the settlement in December 1975. It also stipulated that none of the Gulf countries would seek to obtain more advantageous terms negotiated by other producing countries.13

Although the financial cost of the agreement was high, oil industry executives justified it on the grounds that the agreement would insure stability of price and supply for the next few years.14 In this belief they were wrong. Even before the agreement was concluded, Sheikh Zaki Yamani of SaA indicated that the growing world scarcity of oil would lead to new price demands by the oil-producing countries. Moreover, the settlement reached by LBY in March provided for an immediate increase of 65 cents a barrel; LBY thus once more leapfrogged ahead of the PER.G countries.15

On September 22,1971, OPEC met again in Beirut where it passed two resolutions, one calling for participation in the producing companies on an individual or group basis and the other seeking changes in the price structure of oil to reflect the dwindling value of the American dollar. Acting unilaterally, LBY sought to increase its share of oil revenues through directives to the oil companies regarding the exchange rates applicable to their payments. At the same time Iran sought to reopen negotiations on its settlement with the oil industry.16

In response to these new moves within the OPEC community, John McCloy once more requested from the Justice Department "Business Review Letters" authorizing the oil industry to negotiate jointly on currency parity and participation issues with OPEC without fear of vs-fdu action by the Justice Department. The necessary assurances were given, and on January 20, 1972, the companies and OPEC met in Geneva, Switzerland to consider the currency and participation issues. There the oil companies agreed to increases in the price of oil amounting to 8.5 percent.17

A much more difficult problem was the one of participation. The sheikdoms of Abu Dhabi, Qatar, and KWT all won agreements for 20 percent ownership from the companies. In Iraq, after failing to win a greater share in revenue, participation in the cns~, and a guarantee of high production, the government simply nationalized the consortium that had operated the fields since 1928.18

The battleground of the struggle over participation, however, was Aramco. Throughout 1972 representatives of the Aramco partnership bargained with Sheikh Yamani over the participation issue. Secretary of the Treasury John Connally even made a threatening speech in which he remarked that Washington might soon have to back up private companies in dealings with foreign governments involving natural resources deemed vital to the United States. But once more the oil companies yielded ground. Finally, in October they accepted the principle of 25 percent participation rising to 51 percent by 1983. By October 1973 all the PER.G states had reached final agreement with the oil companies. LBY, which had not participated in the OPEC negotiations, demanded an immediate 51 percent participation and in the summer of 1973 nationalized those companies that did not agree to surrender this share.19

Why the oil companies agreed to participation is not entirely clear. According to oil company spokesmen they consented for fear of more drastic action by the producing countries, such as nationalization. But Christopher Rand in [Rand.dmk] has hypothesized that the companies agreed to a participation settlement because they were more interested in the supply of oil than the ownership of cns~. According to Rand, as long as the companies maintained a near monopoly over geological and rzv~ data, they could preserve their knowledge of where to invest. As long as they maintained a substantial minority interest in the cns (40 percent), they would be able to maintain their privileged position in the Mideast while losing none of their tax advantages in the United States. To be sure, participation by the oil-producing countries might result-and indeed did result-in higher buy-back prices (the price paid for the oil bought back from the participants) but these increases could be passed on to the consumer. Finally, companies like Aramco would reap a windfall in compensation paid for the participation shares. As Rand thus notes:
... the companies had started to move the center of gravity of their industry's profitability downstream and west. They ... had begun to relax their grip on the ceiling of posted prices—but simple markups on refined product sales reimbursed them for this and they retained their hold over the international trade.
In other words, what mattered to the oil companies now was not so much who owned the oil but who was able to pay for it.20

Whether or not Rand is correct (his analysis is based for the most part on circumstantial evidence) one point is beyond dispute; by the eve of the Arab-Israeli War in October 1973, the oil-producing nations, acting through OPEC, had become powerful enough to dictate terms to the oil industry. In fact, as Rand also comments, the participation negotiations of 1972-73 were anticlimactic in comparison with the breakthrough the oil states had achieved in 1970-71, especially the LBYn settlement and the Teheran and Tripoli negotiations. The oil embargo following the Arab-Israel war merely made manifest how well OPEC had learned the lessons of cxx politics from its former teachers.

Yet, what had developed by 1973 was not so much the breakup of the old oil cxx and its replacement by OPEC as the interlocking of an oligopoly and a cxx, the first consisting of the oil majors, who continued to control most of the flow from the Mideast and who were interested in the supply of oil, and the OPEC countries, who were concerned primarily with the profits to be made from the production and sale to the companies of oil. By their control of world oil, the oil majors (and some of the larger independents, like Occidental) provided the OPEC countries with assured outlets for their oil without the type of competition that could drive prices down. At the same time the OPEC nations afforded the oil majors a preferred status insofar as supplies of oil were concerned. In its own way, therefore, OPEC contributed to the rationalization and stabilization of the international oil market, which, after all, had been the purpose of the old oil cxx in the first place.

EPILOGUE NOTES:113-14

1. Anthony Sampson thus writes that a new generation of Arab technocrats followed carefully the attacks on the oil companies in the United States and that references were repeatedly made by the OPEC countries to facts contained in the Federal Trade Commission report on the international oil cxx. Sampson.Seven=162.
2. *1975:WDC|SNT.MO=88-89.
3. Ibid., pp. 90-91 and 97-100.
4. Ibid., pp. 121-24.
5. Ibid., pp. 124.
6. Ibid., p. 126.
7. Ibid., p. 127. See also John J. McCloy to Richard W. McLaren, July 31, 1971 [SNT.MC,6=234]. McCloy, who represented the oil majors and some of the larger independents in the Mideast, commented, "The companies were . . . faced with the threat of repeated 'leapfrogging' on pain of seizure of oil producing properties or serious stoppages with consequent disruption of the supply of oil to the consuming countries. In the circumstances, it was clear that the only hope of achieving stability of supply was for the companies to join together and negotiate with all members of OPEC as a group."
8. LBYn Producers Agreement, January 15, 1971, attached to McLaren to McCloy, January 15, 1971, ibid., pp. 224-30. See also SNT.MO=127-28.
9. SNT.MO=128; McLaren to McCloy, January 15, 1971, SNT.MC,6=224.
10. McCloy to McLaren, July 23, 1971, SNT.MC,6=231-45.
11. SNT.MO=130-131.
12. SNT.MO=132-33.
13. McCloy to McLaren, July 23, 1971, SNT.MC,6=231-45.
14. Ibid.
15. Ibid.; SNT.MO=134.
16. McCloy to McLaren, October 15, 1971, SNT.MC,6=245-46; SNT.MO=134-35.
17. McCloy to McLaren and attachments, October 19, 1971, and McLaren to McCloy, October 22, 1971, SNT.MC,6=246-49; SNT.MO=135-36.
18. Sampson.Seven=237.
19. Sampson.Seven=234-39; SNT.MO=138-40.|
20. Rand.dmk:303-06; See also Blair.Control:269-75.

}r{
OPEC. General Information|
}s{}t{}8{}


|>PAW <>Petroleum Administration for War [W#1]
|>Ptg <>Pentagon, USA mlt HQ

<>Rocky Mountain Institute| n{}o{}

|>Rth.bnk <>Rothschild fmy bnking enterprise, esp. >PRS.Rth | CF=Mazut & Bnito

|>SEC <>Securities and Exchanges Commission [W] [Coll.Private:]
|>snd <>Syndicate, a group of individuals or organizations combined to promote some common interest CF= cxx
|>stt.dpt <>State Department, usually "USA.stt.dpt"
|>TX.E.ptpt <>Texas Eastern Transmission Corporation [W#1]

<>Union of Concerned Scientists| n{}o{ homepage GOOGLE "Energy" nrg.new}
|>U.S. PIRG <>U.S. Public Interest Research Group| n{}o{ homepage links to "Energy"| nrg.new}

 


<>United States Department Of Energy|>DOE| a{}n{R&A5.ecx nrg}o{ GOOGLE "DOE" }
*1997sp:DOE/EM-0328...S.l.:s.n.|_Environmental Management Activities, United States-Russia...| ((E 1.90/3:0328))
*--Energy Information Administration www = "Countries"

<>United States Federal Trade Commission|>FTC|
*1952:WDC, FTC|_The_International Petroleum Cartel| ((>1952:FTC| G/Blair,John SMT))

<>United States House of Representatives, Judiciary Committee on Monopolies and Commerical Law
*1975se11:Submission of Exxon Company| ((Exx.crp.nrg))

<>United States Senate. Cmm on the Judiciary|>SA&M|. Subcommittee on Antitrust and Monopoly [Sen. Frank Church, Chmn] G/Blair.Control
*1964:WDC|_Hearings... |_Economic Concentration| ((>1964:SNT))
*1978:WDC|_Oil Company Ownership of Pipelines| ((UO))

<>United States Senate. Committee on Foreign Relations| (("Church Committee"))
*1973-1976:WDC|>SNT.MC|_Multinational Corporations and United States Foreign Policy. Hearings before Sub-committee on Multinational Corporations. 93rd Congress, 2nd session, 1974 ("Multinational Hearings" in notes)| 17vv| ((UO has part 3 & 7 [v3 & v7] Southern Oregon has it all| Hitherto secret interindustry correspondence and memoranda, much of it highly damaging and much of it revealed for the first time in 1974 by the Senate Committee headed by Frank Church of Idaho, have provided the basis for many of the charges being made against the oil industry [Kaufman.Oil reluctant tribute] ))
 *1975:WDC|>SNT.MO|_Committee Print, Multinational Oil Corporations and U.S. Foreign Policy: Report ((
Full E-TXT| noUO ILL only
TXT of ch#1 -- Establishing the American Presence in the Middle East [AfroAsia]
TXT of ch#2 -- The 1947 Aramco Merger
TXT of ch#3 -- Foreign Policy and Antitrust: The Cartel Case and the Iranian Consortium
))

<>United States Senate. Committee on the Judiciary. Subcommittee on Antitrust and Monopoly| ((vs-fdu mpy))
*1978:WDC|_Oil Company Ownership of Pipelines|>SNT.ptpt| ((Since 1906, with the passage of the Hepburn Act, interstate petroleumpiplines have been subject o common carrier restrictions. However, common carrier regulation has failed miserably to ensure that all potentiall shippers have practical access to petroelum pipelines and that the enourmous economic benefits of pipeline transportation are passed on [to] the consumers in the form of lower prices. [... Subsequent history has shown that common carrier regulation proved to be inadequate] to prevent oil companies from gaining anticompetitive advantages through ownership of pipelines"  [1] ))


|>UNO <>United Nations Organization
|>WhH <>White House, site of USA prx apx
|>WoB <>World Bank [W] [Wki] [CF=IMF]
|>WTO <>World Trade Organization| n{}o{ homepage | Wiki }

 

Petroleum/Oil/Natural Gas cmp~ and energy-related >Construction cmp~
|>crp.nrg & >crp.bdg

"The names of the companies present a special difficulty, for some of these have changed in the course of their long lifetimes [...]. While their names have changed, their character has been a continuous development" [Sampson.Seven=xiv].

Should we wonder why crp~ as legal persons have frequent need for aliases? Following this line of thought, should they, as legal persons before a court of law, fall under the "three strikes and you're out"?

History and status of petroleum industry [Wki]
List of worlds oil production companies [Wki]
Graph of wrl rzv~ held by 50 leading crp~ (23 ntn.fxx-cmp~ named, 27 prv.fxx-cmp combined)

|>7ss <>Seven Sisters [ID] [Sampson|_Seven | Aljazeera presentation = "The Secret of the Seven Sisters" [4-part video]| ((History of how "a secret pact formed a cartel that controls the world's oil"| Achnacarry [ID] and thereafter, from the Arabic point of view))| LOOP on Seven Sisters | G/07mr12/ for the "new seven sisters" (7ssN) &  4ss.old
7ss list = BP.crp.nrg | Chv.crp.nrg | Exx.crp.nrg | Gulf.crp.nrg | Mob.crp.nrg | Tex.crp.nrg | Shell.crp.nrg

|>AP.crp.nrg <>Anglo-Persian| bcm |>AI.crp.nrg|>Anglo-Iranian|>AIOC, then bcm |>BP.crp.nrg & |>NI.crp.nrg
|>Amo.crp.nrg <>Amoco| n{}o{}s{Wki}t{}8{}

|>B.bdg.crp|>Bxt.crp.bdg <>Bechtel
|>BMH.crp.nrg <>Burmah Oil Co. [Myanmar [>MMR.crp.nrg] contemporary name fr old BMH] G/MOGE
|>Bnito <>Caspian and Black Sea Oil Company, PRS.Rth cmp. RthAlphonse 1883:1911 [Wki]

 

 

|>BP.crp.nrg <>British Petroleum Co| n{}o{7ss.lgc

}f{

Earlier AP.crp.nrg, then AI.crp.nrg

Anglo-Persian [AP.crp.nrg] G/1909ap

Due to the distance from Europe to Persia (H02) and the logistical difficulties involved, a 130-mile ptpt to the coast (R11 ??) was not completed until 1911 and a source refinery (PL07) on the island of Abadan(R13a) was not completed until 1913, at which point the company once again needed financial help [Greene.Strategies:240]

GryCh had been pressing the Foreign Office for a subsidy since 1912, arguing that Shell was a foreign company whose loyalty was questionable and a marketing monopoly. The Foreign Office was convinced but the admirals were wary of involvement and interested in price. After a public outcry against high oil prices in 1911 Churchill, who became First Lord of the Admiralty in October 1911, was suspicious of Shell and came out in favor of AP.crp.nrg (EC14a), "Against this (the dominance of Standard and Shell),... the Burmah Oil Company, with its offshoot the Anglo-Persian Oil Company, is almost the only noticeable feature." Of Shell he said, "It is their policy...to acquire control of the sources and means of supply and then to regulate the production and the market price... We have no quarrel with Shell. We have always found them courteous, considerate, ready to oblige, anxious to serve the Admiralty and to promote the interests of the British Navy and the British Empire—at a price... The only difficulty has been price. On that point of course we have been treated with the full rigor of the game... we shall not run any risk of getting into the hands of these very good people."17 An independent blue ribbon commission, including Sir John Cadman, was sent to Persia and reported favorably on the oil fields. Cadman (PV06) then a professor of petroleum, civil servant, and Britain's leading oil expert, subsequently joined AP.crp.nrg in 1921 and succeeded GryCh in 1927 as chairman [Greene.Strategies:240]

In 1914 Churchill convinced Parliament to bail AP.crp.nrg (PL05)(PL08), investing £2 million for just over 50% of the company (EC14b)(R14a). His desire like Fisher's was to convert the Royal Navy to oil because oil-fired ships were much faster, more efficient, and had greater range than coal-fired ships [Greene.Strategies:240]

 [Greene.Strategies:241=]

AP.crp.nrg got capital in exchange for an oil supply contract (R14a, R14b, PL04) for the Navy at a cut-rate price.21 [nvy.rsv] Some of the oil companies' greatest difficulties have come from navies who, since this precedent, have seemed to feel entitled to a cut-rate price. Examples are Socal's difficulties after WW1 over price on the West coast, the post-WW1 fear of shortage which led to the establishment of the Elk Hills Naval Reserve in California and a court battle with Socal over its perimeters, and the U.S. Navy's attempt to buy into SaA in 1943 (see Chapter 7) [Greene.Strategies:241]

The agreement stipulated that the company must remain an independent British company and every director must be a British subject (PL01).22 To represent its ownership the government was to appoint two directors with veto power over issues of national strategic importance. But otherwise the government was not to interfere with the conduct of the business (PL08). If this distinction was clearly specified in the government's agreement with the company, elsewhere the distinction of being an autonomous company majority owned by the British government was blurred.23 "Even in Persia," Lord Strathalmond, chairman from 1940 to 1954, said, "they were never quite convinced that I had not come straight from Whitehall."24 In Iraq the company and the British government were thought to be one and the same.25 As events show, this special business-government relationship was both a strength (R14c) and a weakness (H01) [Greene.Strategies:241]

Mikdashi analyzed the financial and political aspects of the agreement, points 1 -5 below, concluding that the government in retrospect got a good deal, though at the time Marcus Samuel of Shell considered it a "gigantic subsidy" to AP.crp.nrg and pleaded for similar treatment.26 (1) The government purchased stock at par at a time when market values were much higher and a large shareholder of AP.crp.nrg (probably Burmah) urged in 1914 that existing shareholders be given the option of providing at par the additional capital required.27 (2) The lifelong fuel oil supply contract with the British Navy (R14b) called for prices which were much lower than those prevailing in the market and provided for an automatic reduction in price up to 25% of the excess of profits above dividend requirements. Cumulative savings from this provision were estimated by Churchill in 1923 at £7.5 million and by the Persians in 1951 at $500 million.28 (3) The contract assured the company a profit regardless of market conditions, insulated it from all competition, and spared the company the expense of building a marketing organization in competition with the large international oil companies (PL09).29 But it also directed its production technology to a specific product, fuel oil (PL19). The government favored and assisted (R04) the company in the sale of products to other buyers, like the Iraqi and Indian railroads. Churchill openly declared that the British government was "bound to help and bound to enrich AP.crp.nrg" [Greene.Strategies:241]

Its political assistance in limiting competition and influencing Near Eastern governments greatly benefitted the company. (5) AP.crp.nrg made some "public service" expenditures it might not have made were it not for government ownership (PL06)(PL10)" [Greene.Strategies:242]

As the visible symbol not only of the British Empire (PL01) but also of western civilization the company recognized its social responsibility in bringing that civilization to Persia. It trained labor and built roads, houses, schools, and communications in the country (SR01, PL10). As at Jersey Standard, the medical department made some of the greatest contributions. Providing medical care in Persia not only to their own employees but to anyone in the area was a company policy (PL06)(SR02?) from its earliest days. An extraordinary doctor and mediator, MY. Young, known to all as the Little Doctor, led this effort from 1907 to 1936. So great was the respect for him that the neutrality of Persia during WW1 and the absence of trouble in the oil fields during the war has been attributed to his personal influence" [Greene.Strategies:242]

It is impossible to place a dollar value on the benefits (PL05) of the special relationship (R14c) to the company. The government's restriction of competition is surely responsible for the company's leading market share in the Mideast. Without it Jersey would have entered Persia in 1921; there might not have been any Red Line agreement in 1928 [ID], and it is unlikely that AP.crp.nrg would have gotten into KWT in 1934. With a guaranteed contract for large amounts of fuel oil to the British Navy (R14b) the government gave the company a different product and marketing strategy (PL04) than the kerosene/gasoline-sold-to-private consumers-and-industry strategies of the other Majors. The contract also gave AP.crp.nrg large scale (R14d) in production, refining, and bulk sale marketing (PL11) [Greene.Strategies:242]

The characteristics of Persian oil—high quality, unlimited quantity, and low cost (EC9, RI3c) also shaped AP.crp.nrg's product and marketing policies (PL04)(PL09)(PL11). They overcame the handicap (EC07) of Persia's remoteness from markets. With or without the contract (R14b) and special relationship with the government (R14c. HI) AP.crp.nrg would still have been able to compete successfully with any other company. The government's military protection was not required again until WW2 and in 1951 when needed was not used. The influence of the British government with the Persian government (EC06) permitted the company to adopt courses of action and attitudes (PL13) in its relationship with the Persian government that ultimately cost it a great deal (H01) [Greene.Strategies:242]

In early 1915 as World War 1 (EC15) moved into full force and wtpt rates soared, the company made another important strategic commitment that would become its second strongest vertical segment (after production PL02). In April 1915 it formed the British Tanker Company (R15), a wholly owned subsidiary to own and manage its own wtpt fleet (PL12), in order to obtain secure and reasonable marine transportation [Greene.Strategies:242]

[ mlf=] Disputes between the company and the Persian government (PL13) led to (he "interpretative" agreement of 1920 (R20) which in effect revised the D'Arcy cns to reduce the base for royalty payments to the Persian government to the profits of the producing company in Persia. The D'Arcy cns had originally specified the Persian government's share to be 16% of net profits generated by all subsidiaries in exploiting Persian oil (including refining, marketing, and transportation) [Greene.Strategies:243]

On occasion the company did not pay this amount. The Persian government was weak, inefficient, and [?like the company itself?] corrupt (EC04). It did little except to organize bribery for its rulers and provided no protection in areas where its authority was nominal. According to one account the local press referred to them as the "robber princes." The company had already had to give £3,000/ year and a 3% equity share in all companies working on their land to the Bakhtiari tribesmen for "protection" in 1905 (H02). In 1914 it unilaterally deducted these payments from the Persian government's share. In 1918 it suspended payments over a war damage claim against Bakhtiari tribesmen for blowing up its ptpt in 1915. It refused to arbitrate this dispute despite explicit provisions for arbitration in the cns (PL13) [Greene.Strategies:243]

On these and other smaller matters in its dealings with the Persians the company took advantage of the strength of the British government (EC06) and the weakness of the Persian government (EC04), fostering a tradition of inflexible and arbitrary dealings (PL13) which later caused it great difficulty. It refused to allow the Persian govenment any participation in management or equity (PL14) and it tried to induce the Bakhtiaris to sell their shares to British interests. Bribery was the accepted method of getting things done. Both the company and the British government subsidized Persian officials when they wanted something (PL03) [Greene.Strategies:243]

With the Persian treasury and rulers dependent on Britain, a treaty was signed in 1919 giving British advisors the right to negotiate for the Persians. Three Persian officials received £131,000 for signing the agreement. To settle the disputes between AP.crp.nrg and the Persian govenment, negotiations were held between a British Treasury official on behalf of the Persians and AP.crp.nrg to make the company live up to the payments promised and give up artificial bookkeeping methods unfavorable to the interests of Persia [Greene.Strategies:243]

The result of these "negotiations" was the "interpretative" agreement of 1920 (R20) which excluded from the calculation of royalty payments profits of the newly formed wtpt subsidiary, subsidiaries trading non-Persian oil, large amounts of the profit of subsidiaries refining and marketing oil outside Persia. and all profits of less than majority owned subsidiaries. Freed from the restrictions of the D'Arcy cns AP.crp.nrg could now expand outside (PL15) Persia. Persia received £1 million in settlement of all grievances [Greene.Strategies:243]

By 1920 the major elements of Anglo-Persian's strategy were in place. It was an independent but quasi-governmental company which was an arm of Burmah Oil and the British Empire (PL01)(PL05)(PL08). [u&d : nxd pmp rfn tpt mkt=] It was organized to find and produce Persian oil. refine, transport, and sell it as fuel oil to the British Navy (PL02)(PL04)(PL07)(PL012). It was a strategy quite different in geography, vertical integration, product, and administration from any other Major. From these commercial and national strategic purposes, the other policies follow [Greene.Strategies:243-4].

The next period in BP's history [between WW1 and WW2] was marked by steady growth in its volume of business and some additions to its geographical areas of activity. There was one major shift in strategy (PL17): [u&d : pmp-mkt] to integrate vertically from production through marketing, rather than simply produce and sell fuel oil to the Navy. The important additions were production in Iraq and KWT, refining in Britain and France, and joint marketing arrangements in Europe (R17)(R32) [Greene.Strategies:244]

Having found oil in Persia, the company resolved to seek additional cns~ and find ii elsewhere as well (PL16). This was partly due to its success in exploration (R08) and partly to diversify its sources of supply to carry out its mission for Ihe British Navy{PL04). It was also to reduce its dependence upon Persian politics (PL15). which had become more difficult with the disputes cited above and less predictable as the Shah and, with him, British influence became weaker (EC04)(EC05). It may also be attributed to the far-sighted and global views of Sir John Cadman, who became Deputy Chairman in 1924 (PV05).J9 The "interpretative" agreement of 1920 (R20) cleared the way of obstacles [Greene.Strategies:244]

In a defensive move it first attempted to secure the rest of Persia but its efforts came to nought.

The events of war (EC39) brought great changes in the company's environment but none in its strategy. Before the war a large expansion intended for completion in 1943 had begun. [u&d#1=] Drilling continued in new fields discovered since Masjid-i-Sulaiman in 1908: Naft Khaneh (1923). Haft Kel (1928), Gach Saran, Agha Jari, Pa7_anun (gas), Naft Safid (all discovered after Haft Kel), and Lali (1934) (R27c)." After Italy's entry into the war closed the MDX.S, the "short haul" policy (EC40) adopted in mid-1940 to minimize the danger from submarine attack meant supply from Venezuela and the U.S. Persian production was cut from 234 TBD in 1938 to !30TBDin 1941 and Iraqi production from 80 TBD (1938) to 30 TBD (1941)

10.4 Aftermath

Certainly they were men of talent with other accomplishments, but it is worth noting that the upheaval in Iran did not produce a noticeable shift in policy or personnel. Lacking evidence to the contrary, a plausible conclusion is thai their careers offer indirect evidence of the continuation of their policies and inflexibility which subsequent events have not tested. With majority ownership and director representation the British government could have expressed its dissatisfaction on this important strategic matter but it did not; nor did other shareholders. Survival of the crisis, if anything, increased their independence from government constraint. Shortly thereafter, with the Suez Crisis in 1956 (EC56), British government influence (EC06) ended. Having been let down by the British government, the company took steps to outgrow it.

For the company [BP] the story had a happy ending. [u&d#1=] Their response was to double their efforts at what they did best, explore for oil (PL16). with results that were the envy of the industry. Sir Eric Drake said. "The 1951 nationalization of our Iranian properties seemed like a deadly blow at the time, but it caused us lo engage in an unprecedented wave of new exploration. It turned out to be the freshest breeze that ever blew through these corridors. I guess a nasty jolt every now and then doesn't do any harm." Iran did not want to be dependent on them; they did not want to be dependent on Iran either (PL15).

The search was world wide (PL16). In the Mideast BP began exploring in the sheikdoms along the Trucial Coast in 1952 and made a major strike in Abu Dhabi in 1958 (R58b). Two more fields, Magwa and Ahmadi (R58c,d), were found in KWT the same year. In Africa they had begun exploring in NGR in 1949 (R49c), made the first discovery there in 1953 (R53a), and began export production in 1958 (R58e).** A small strike made in Egypt (Anglo-Egyptian Oil Fields—15-1/2% BP)(R54d) was confiscated during the Suez Crisis (EC56) and returned in 1959." BP was among the first companies granted cns~ in LBY in 1955 (R55b) and in 1961 discovered the Sarir

Greene.Strategies:255

field (R6la) in a joint venture with Nelson Bunker Hunt." The acquisition of 42% of Triad Oil Company in 1953 (R53b) gave BP leases in Alberta on which it developed production by 1955 (RSSc ??). In 1954 and 1955 it acquired interests in two companies with production in Trinidad (R54b)(R55d)

It made a discovery in Colombia in 1961 (R61b). BP explored in most of Europe, purchasing a small field in Germany in 1958 (R58g)."'" It began exploring in the North Sea in 1962 (R62) and has made four discoveries with p.rzv~ of 2b of the thirteen billion barrels discovered to date, making it the largest holder there also. Only in the Far East has it been less successful than other companies. Thirty years of searching in Papua (New Guinea) has yielded only traces of oil, though small discoveries in NDN and Australia were made in 1971 and 1972 (R7I)(R72).104 In addition to these successes it has also explored numerous other places,

BP's success must be largely attributed to skill (R27c). The number of major discoveries it has made exceeds what may be attributable to luck. Neither does evidence on activity support a timing advantage from a head start caused by the Iranian nationalization which might have allowed it to lock up promising areas while other Majors were preoccupied with trying to market a surplus of Mideast nrg.pc. BP had more surplus nrg.pc than any of the others as a consequence of its position in the Mideast and limited integration (PL09)(PL22). And others were exploring worldwide at least as vigorously according to my data on capital expenditures and numbers of countries in which activity occurred. Competitors note the unusual independence allowed the exploration group at BP to take risks and back commitments. One noted, "They seem to have a genius for finding large, simple structures,"105 and he went on to note that they get in quickly and get out quickly when results are discouraging. Looking for only the largest structures is a luxury appropriate to a company with large resources elsewhere.

BP expanded downstream (PL17), predominantly in the Eastern Hemisphere (PL18), as its nrg.pc supplies grew. It added refineries in Northern Ireland. Germany (Ruhr), the Netherlands (Rotterdam), Italy (Turin), Switzerland, Cyprus, Ivory Coast, NGR, Rhodesia, South Africa, Lebanon, and Singapore (R60a)(R61). Nearly all these refineries were small, local market refineries and nearly all were jointly owned. The use of joint ventures reflected the effort to find outlets for its nrg.pc while limiting downstream commitments (PL19). Longer than any other Major, BPcontinued to rely on its huge source refineries in the Mideast. As late as 1960 at least half its products came from its refineries in Iran, KWT, and Aden (PL07). In the next decade this policy shifted as its nine large European refineries expanded to 2/3 of its total and

Greene.Strategies:256

the Mideast declined to 1/5 (PL23).l06 In 1976 95% of its products were refined and 85% marketed in the Eastern Hemisphere (PL18).'07

Marketing volumes have remained approximately even with refining levels and with similar geographic distribution. In I960 56% of its products were marketed in Europe.1"9 By 1976 the proportion rose to 71% (PL18). Product distributions are not given in BP's annual reports but it is likely they would show continued reliance on fuel oil and wholesale marketing (PL04)(PL11)(PL19)(PL20). This one can infer from the reliance on source refining (PL07) (lighter products are more difficult 10 transport and require market refineries), the products required by the European market (more heavy fuel oil and less gasoline than the U.S.)(EC60).and the limits on BP's commitment to refining and marketing measured by the relatively small scale and partial ownership of its refineries and marketing organizations. Also, after Europe, BP's second largest outlet, accounting for 23% of its product sales in 1960 and 10% in 1976, was the bunker trade (PL04)(PL20)."0

Another indication of BP's relative lack of commitment (PL09) lo refining and marketing is that after Shell Mex-BP was dissolved at the end of 1975 BP was not number one in any of its produci markets, even Britain, where its 16% was second to Shell's 24% of the market.1" This contrasts sharply with its producing positions where it is the leader in the Mideast, the North Slope, and the North Sea,

The downstream policies discussed above add up to a continuation of the policy of the 1920s to use nrg.pc rather than cash to buy outlets for nrg.pc (PL19). This, in turn, reinforces the strategy of a company primarily interested in finding and producing nrg.pc (PL02)(PL09)(PL16). As refining and marketing lagged behind production after the end of WW2 BP became the largest nrg.pc seller (PL22). Between 1971 to 1974 it was selling as much nrg.pc to companies like Exxon and Petrofina as it refined and marketed itself. It admits taking downstream losses to move nrg.pc. The policy of moving the maximum volume of nrg.pc (PL24) was pursued partly because profits were highest ai (he production stage and often zero or negative in refining and marketing and partly to satisfy the demands of the Arab governments. As Robin Adam, a BP managing director, put it, "We were taking losses downstream in order to get out goods upstream because that's what the Arabs wanted."111

An interesting question about the behavior of the Majors during the 1950s and I960s is to what extent this strategy of moving the maximum nrg.pc at minimum expense was profit maximizing or whether it was done at the sacrifice of profit to keep the producing country governments happy or both. If the path to maximum profit were lo move the maximum volume of cheap Mideast nrg.pc with the least investment downstream, then BP should have been the most profitable Major. But as shown in Table 11-5, it in fact has often been the least profitable since the 1950s. This fact may be explained by

Greene.Strategies:257

any of several possibilities: (a) the maximum nrg.pc volume theory is incorrect and downstream operations have not been unprofitable (as Adelman suggests);"4 (b) the theory is incomplete, having omitted possibly important factors like the profitability of the U.S. gasoline market compared to the European fuel oil market; (c) BP has been poorly managed; (d) BP's tax burden has been higher than others; or (e) it suffered relatively more from the nrg.pc glut and price declines in the 1960s,

Because of its relative weakness in refining, its abundant resources upstream, and its nrg.pc moving rather than value adding strategy, BP was the last of the Majors to make a significant entry in petrochemicals. Though it has had a joint venture with The Distillers Company to manufacture basic petrochemicals at its Grangemouth refinery since 1947, it did not make an entry comparable to other Majors until 1967 when it acquired The Distillers Company (R67)."5

The same factors have limited other diversification, making it one of the least diversified Majors. Its only other significant venture outside oil came in 1970 with the foundation of a subsidiary (R70b) to manufacture high yeast proteins for animal feed in 1970."6

These downstream and diversification patterns are the logical conclusions one might expect from a consistent set of policies beginning with selling fuel oil from Persia to the Royal Navy. BP unobtrusively did what it does best, though less profitably than others. Its latest, and probably most brilliant, strategic move, entry of the U.S. market through acquisition of Sonic in 1970 for North Slope nrg.pc, is a significant departure from the past.

[u&d#1=] Prior to its major discovery at Prudhoe Bay on the North Slope of Alaska. BP had few operations in the Western Hemisphere (PL18)(H05) and almost none in the United States. It had obtained leases and some production in Canada by acquiring Triad in 1953 and had built a refinery at Montreal in 1956. It had some production in CLM. But it had not even explored in USA (H05).

Looking for outlets after the discovery in Alaska it bought (R69) 9700 Sinclair stations from Atlantic Richfield for a S400 million note from ARCO in 1969. Then in 1970 it bought what will become (R70a) majority ownership of Sohio, a nrg.pc short Midwest refiner and marketer (Standard Oil of Ohio), with (he first 600 TBD of its North Slope production, acquiring a U.S. presence and a strong downstream organization without spending a drop of cash. With a debt free balance sheet Sohio can borrow to finance development of North Slope production and its own purchase."7

[u&d] Even more amazing is that the Sohio purchase puts it well on the way to becoming the sixth U.S. Major. After its Eastern Hemisphere rzv~ have been lost through nationalization (EC76), it will be a vertically balanced U.S. and European company with the majority of its assets in the U.S. by the 1980s.

Greene.Strategies:258

Its [l&r u&d=] geographical, vertical, and product policies as well as its identity (PL01)-(PL11)(PL13)-(PL15)(PL18)(PL19)(PL21)(PL24) will all change. It will have broken its last link with the Empire. In the process it has rescued itself from decline. Perhaps it will be renamed American Petroleum if the British government ever divests its shares. This concludes the narrative of the strategy of British Petroleum. A classification and summary of evidence for each policy is presented in Exhibit BP-1.

}m{


The strategy of British Petroleum (BP) may be briefly summarized by four of its strategic characteristics. [1] BP is a British and once colonial company, an instrument of the British Empire, the only Major with government ownership, and possesses a long and intimate relationship with the British government. [2] It is the founder of the Mideast oil industry and until recently its largest pmper. [3] It is primarily an Eastern Hemisphere (Mideast/Europe) company and, until its 1970 acquisition of Sohio for its North Slope nrg.pc rzv~, [Big.crp.nrg] the only Major without a strong U.S. presence. It is also the largest pmper in the North Sea. [4] It is the most successful [nxd] explorer for oil in the world, the largest nrg.pc seller [mkt], and the weakest of the Majors downstream [Greene.Strategies:237]
}s{}t{}8{}

 

|>Chv.crp.nrg <>Chevron (>SoCal) [Std.chd, Std.CA] n{}o{7ss.lgc}

 

|>CNP.crp.nrg|>CNPC <>China National Petroleum Corporation| n{}o{7ssN
}s{Wki
}t{}8{}


|>ExxM.crp.nrg <>Exxon-Mobil [Std.chd]| n{}o{7ss.lgc
}f{
Std bcm many Std.chd~| EG= Std.NJ bcm Esso (70s:Still so in EUR) bcm Exxon bcm ExxM
}s{}t{}8{}


|>Exx.crp.nrg <>Exxon|>Esso| [Std.chd] n{}o{7ss}

 

|>Ggzz.crp|>Gzz.crp.nrg <>Gazprom| n{}o{7ssN
}s{
Klare.Rising=108-14
}t{}8{}

 

|>Gulf.crp.nrg <>Gulf Oil| n{}o{7ss}

 

|>Hlb.bdg.crp| <>Halliburton| n{}o{
}s{
Official W
Independent W
Coll.Private:67-70,373-4
}t{}8{}

 

|>IRQ.crp.nrg|>Q.crp.nrg <>Iraqi Petroleum Co|>IPC often| n{}o{
}f{
1920s:1970s; ENG FRN & USA cmp controlled IRQ nrg.p
}s{}t{}8{}


|>KBR.bdg.crp <>Kellogg, Brown and Root

|>Luk.crp.nrg <>Lukoil (RUS)

|>MOGE <>Myanma Oil and Gas Enterprise (MMR) [Homepage]


|>Mob.crp.nrg <>Mobil| n{}o{7ss
}f{Std bcm many Std.chd~| EG= Std.NY (Socony) then joined Vacuum & bcm Socony-Vacuum bcm Socony-Mobil bcm ExxM
}s{}t{}8{}


**1948:|IRN Tehran |>APOC 35:bcm >AIOC 51:bcm >NIOC 54:bcm BP.crp [GO]  79:bcm |>NI.crp.nrg| <>National Iranian Oil Co| n{}o{7ssN
}p{
*1901: F/D'Arcy/
*1908my:D'Arcy discovered oil
*1923:BMH.crp (w/Churchill playing leading lobby role) got UK gvt to grant exclusive ENG access to IRN nrg.ggr
*1935:Persia bcm IRN, so APOC bcm AIOC
}r{
Company homepage
}s{
Wki
}t{}8{}

 

|>Oman.crp.nrg <>Oman Oil Co

|>Occ.crp.nrg <>Occidental Oil

 

|>P.BRZ.crp.nrg <>Petrobras| n{}o{7ssN
}s{
*--Wki
}t{}8{}

 

|>PDV.crp.nrg|PDVSA <>Petróleos de Venezuela, S.A.|>Petroleum of Venezuela| n{}o{7ssN
}r{
Homepage
}s{
Wki
}t{}8{}

 

|>PNB.crp.nrg <>Petronas|>Petroliam Nasional Berhad| b{MLZ}n{}o{7ssN
}f{
*1968:>MISC Berhad fnd~|>Malaysia International Shipping Corporation Berhad| Leading international shipping line |Later PNB bcm main shareholder
*1974au17:MLZ| crp fnd- as wholly stt,fxx- stt.crp
}s{
Wki
}t{
}8{}

|>Rsn.crp.nrg|>Rsn.crp.pg = Rosneftegaz| <>RosNeft
|>Rsn.bdg.crp <>Rosneftgazstroi


|>SaA.crp.nrg|>Aramco <>Saudi Aramco|>Saudi Arabian Oil Co|> n{}o{7ssN
}m{
*1920:San Remo Petroleum Agreement excluded USA from IRQ
*1932my29:BHR| SoCal subsidiary, Bahrain Petroleum Co [BAPCO|>BHR.crp.nrg] had discovered nrg.p & beat out IRQ.crp.nrg for cns & tfr-it to wholly owned subsidiary, California Arabian Standard Oil Co [>CA.SaA.crp.nrg]
*1936:CA.SaA failing| Tex.crp.nrg fxx- 50% share| Joint venture called California Texas Oil Co [>CalTex]
*1944:W/success cmp name bcm Arabian American Oil Co. [Aramco]
*1948:Std.NJ joined SoCal & Tex.crp by fxxing 30% on cns| This required lifting "Red Line Agreement" [ID]
Thn:Socony Vacuum fxx- 10%| Now 4-way fxxership, 30, 30, 30 & 10%
*1945fe:SaA King Abdulaziz [Wki ID], generally known as Ibn Saud, met first with USA President Franklin Roosevelt and then with British Prime Minister Winston Churchill [Wki ID w/pix]
*1950:Trans-Arabian ptpt, the "Tapline" completed [Wki ID]
*1950:Ibn Saud briefly threatened to nationalize SaA nrg.p, forcing Aramco to share profits w/SaA 50%/50% and move cmp HQ to Dhahran SaA. [*1950no:US gvt quickly created "Golden gimmick" to compensate crp.nrg~ (Wki ID)]
*1980:After OPEC, SaA fxx- SaA.crp.nrg, now crp.nrg was under full SaA fxxership
*1987:East-West nrg.pc ptpt completed
*1988:crp name formally changed to Saudi Aramco| nrg.p supplies to ISR terminated
*1992:SaA.crp fxx- 35% of KOR SsangYong Oil Refining Company (S-Oil)
*1994:SaA.crp fxx- Petron, largest refiner in the Philippines| Wki list of SaA.crp rfn~
*1996:SaA.crp fxx- 50% of Motor Oil (Hellas) Corinth Refineries and Avinoil from the Vardinoyannis family; Also assumed controlling interest in two Jeddah-based lubricants companies, now known as Saudi Aramco Lubricating Oil Refining Company (Luberef) and Saudi Arabian Lubricating Oil Company (Petrolube)
*2005:Agreements w/Sumitomo Chemical Co. [Wki ID], etc. [Wki ID]
*2007:SaA.crp agreements with ExxM.crp.nrg, Sinopec Corp and the Fujian Provincial Government of CHN
*2009:SaA.crp inaugurates KAUST, King Abdullah University of Science and Technology
*2013:SaA.crp agreements with NDN crp Pertamina [Wki ID]
}r{
*--WWW homepage
*--Saudi Aramco World| ((A popular informational journal, hardcopy and www))
}s{
*--Wki
}t{
}8{}

 

|>Shell.crp.nrg <>Shell|>Royal Dutch Shell [W#1 | Wki ] | n{}o{7ss.lgc

}f{

The Strategy of Royal Dutch/Shell [Greene.Strategies:209-30]

9.1 Overview

The Royal Dutch/Shell Group (generally known as Shell after its seashell trademark) is the result of a 1907 joint venture between the Royal Dutch Petroleum Company (60% ownership) of the Netherlands and the Shell Trading and Transport Company, Limited (40% ownership), a British company. As a joint venture with dual nationality it has resolved the inevitable coordinative problems by decentralizing authority geographically to its subsidiaries to a greater degree than possibly any other Major (PL17)1. Decentralization was also a response to [>DtdH] Sir Henri Deterding of Royal Dutch who, with [>SamM] Marcus Samuel of Shell, was responsible for the joint venture and who ruled it with brilliance and tyranny for nearly 30 years. Under DtdH, Shell was Standard's and later Jersey's nemesis, the second largest oil company in the world. [tntn tpt rfn] Multinational and worldwide from its beginning when it shipped refined products in bulk from Russia and the Dutch East Indies to Europe and Asia, it served its markets by taking an interest in every major producing area until WW2—the Dutch East Indies, Russia, Romania, Mexico, the U.S., Venezuela, and Iraq—and matching low cost production with nearby markets. This policy (PL06) contrasted sharply with Standard's practice until the late 1920s of serving its foreign markets primarily with exports from the USA  [u&d#1=] It was Shell's great misfortune (H03) not to share, except in Iraq, in the great discoveries in the Mideast. It had to be content with long-term contracts, principally with Gulf from KWT. Locked out of SaA, Iran (until 1954), and KWT, Shell seemed to lose its expertise in finding oil after WW2 and has gone to great lengths to attempt to regain it. This loss forced it to rely on its large-scale, worldwide refining and marketing organization to move purchased nrg.pc. Shell specialized in lubricants, jet fuel, gasoline, specialty products, and service in the attempt to add value to nrg.pc and, partly as a consequence, developed the largest position in petrochemicals among the oil companies (PL02)-(PL08)(PL19)(PL20).

In 1976, as shown in Table 1-2 (Chapter 1), Shell is still the second largest Major, nearly as large as Exxon, with the largest fleet and a 60% exposure
[Greene.Strategies:209/210]
downstream to the Eastern Hemisphere. Also shown in Table 1-2 are the policies described above: decentralization, nrg.pc shortage, position in chemicals, and product mix. Other than chemicals Shell's principal diversifications are metals through the acquisition of a Dutch multinational metal firm and a half interest in the losses of Gulfs General Atomic subsidiary. The strategies of Exxon and Shell are perhaps more similar than those of any other two Majors in their global scope, vertical emphasis on refining and marketing, and degree of decentralized management. They show that some degree of homogeneity of strategies is possible among competitors from different origins and circumstances. But there are also differences, with Shell being weaker in production but stronger in retail marketing, lighter products, chemicals, wtpt~, and in the Far East and with a more locally autonomous. indigenous organization (PL03)(PL04)(PL05)(PL07)(PL10)(PL11)(PL19)(PL20).

9.2 The "Group"

To understand Shell's strategy one must first understand its organization. As with BP there arc significant differences from what American readers at least will regard as the norm for the top echelon of the organization. The usual pyramidal organization composed of layers of vice-presidents of varying degree heading the operating divisions and culminating with a chief executive and board of directors who meet monthly is absent. In its place are two parent companies, the Royal Dutch Petroleum Company and the "Shell" Trading and Transport Company, Limited, each with its own board of directors. The Dutch and British parents hold stock in a 60:40 ratio in two holding companies, one Dutch, the other British, both called Shell Petroleum more or less. These two holding companies hold stock in equal amounts in some 500 operating companies and ten service companies. Top management of the Group is composed (in 1976) of eight Managing Directors and below them a number of geographical and functional Coordinators. "Managing Director" is a nineteenth-century European title (EC02) for the chief executive who manages a business for his investors. The Committee of Managing Directors is headed by a chairman and a vice-chairman. This organization is partly European, partly post-Colonial, partly McKinsey, and partly expedient. It is distinguished from its American competitors by being a joint venture with unequal partners, two nationalities, and an unfamiliar management structure (EC01)(EC02).

The parent and operating companies seem more familiar. The "Shell" Trading and Transport Company, Limited is a British company whose shares, traded publicly, are almost entirely held in the U.K. The Royal Dutch Petroleum Company is Dutch. Its shares are traded widely with a majority held outside the Netherlands. But by law its chairman and directors are Dutch. National identities are preserved by design (PL14). The operating companies are geographical and functional units, some vertically integrated within a

[Greene.Strategies:210/211]

geographical area. They are not all wholly owned. Many are joint ventures with other companies or governments. Some, like the Shell Oil Company in the U.S., have minority interests. Operating companies have their own subsidiaries and boards of directors.

The ten wholly owned service companies—oil (2), chemicals (2), marine (I), metals (I), nuclear (I), gas (I), coal (I), and research (I)—conduct the activities in the Group that are not decentralized (PL02). In oil these are exploration, group finance, oil purchase, sale, and transportation to and from operating subsidiaries. Coordinators orchestrate these movements.

The Royal Dutch/Shell Group is a group of companies, not a corporation. The Shell Centre complex in London and the offices in The Hague are its central offices, not corporate headquarters. The operating companies are coordinated, not managed, by the central offices. By the tax laws (EC03) of the U.K. and the Netherlands, if they were managed by the central offices, their profits would be taxable in the home countries of the owners. So for reasons of dual nationality and tax liability the decentralization of operations, most often geographically by market (PL17), is not a facade. It is a particularly important issue for executive compensation.

On the other hand Sampson's sly suggestion that if an observer went up to the "bridge" of the leviathan he would find no one there" clearly understates the role of the central office and the eight Managing Directors. The chairman of the Managing Directors behaves just as he would if he were the chief executive.3 "Coordination," if it is less than management, where profit responsibility can be assigned and taxed, is much more than an advisory, technical service role. It is, perhaps, indirect management. Daily operations are not controlled from the central offices. The authority to turn the valves to change product mix at the Curacao rfnery does not come from the central office as it might in other companies. Neither does a central computer in Chicago make out all pay checks worldwide. Instead the tools of coordination are personnel assignment, planning, and internal competition,

Compared to Exxon where decentralization is more on a regional basis with tighter control within each region. Shell's decentralization (PL01) seems to be more on a country basis with more emphasis on local management to the extent that in many places it is viewed as a local company rather than a multinational giant. The British think it is British; the Dutch think it is Dutch; the Americans think it is an American oil company with foreign subsidiaries.4 And while in some areas it is more decentralized than the other major oil companies, it is perhaps more centralized, as all oil companies are, than other European multinationals like Unilever and Nestle.

Shell's policies of geographic decentralization (PL17) and emphasis on the preservation of national identities of all units, not just the British and Dutch, (PL14) are the result of its organization shaped by its joint venture status, unequal ownership, dual nationality, the tax laws, European models of
[Greene.Strategies:211/212]

management, and a reaction to and desire not to repeat DtdH's tyranny (PV14). The disadvantages—inefficiency and overstating—inherent in this organizational structure (H04) are greatest in upstream areas where, not incidentally. Shell today is weakest. They are smallest in marketing where Shell is strongest. As expected it has generally ranked before 1973 among the lowest of the Majors in profitability of its operations since WW2 (though because of its size its net income has traditionally been second largest).1'

However, on another increasingly important scale, political acceptability, it must be ranked at the top. The considerable effort at Shell in diplomacy required to coordinate and preserve national identities has yielded an advantage in political acceptability and therefore long-term viability. Shell has rarely drawn criticism or been confused with Std.crp.nrg. It has avoided political controversy and concentrated on serving its customers, a consequence of its multinationality and a position that Churchill recognized as long ago as 1914.7 Its diplomatic style of management (PL15) and the indigenousness of its local subsidiaries (PL17) are greater strategic investments in political acceptability, if lower in profitability, than other Majors have chosen to make. In these aspects of its organization and strategy Shell differs from the other Majors. It is the United Nations of oil companies, as that body wishes it could function. What follows is the story of its development.

9.3 Formation: Shell before 1907

The story of Shell in its earliest years is not told here for the sake of historical completeness but because, as is also true of the other Majors, many of its most important policies today date from these early years. These include not only its organization discussed in the previous section but also [l&r] its worldwide multinational character (PL02), its geographical strength in the Eastern Hemisphere (PL07 PL08), [u&d=] its vertical emphasis on marketing and shipping (PL03)(PL04)(PL05), the policy of vertical integration by geographical area (PL06), and its brand name and trademark (PL01). The first link between the partners of the Royal Dutch/Shell Group was forged in 1903 with the formation of the Asiatic Petroleum Company (R03). The motive was to survive and prosper against the price cutting of Std.crp.nrg in the Far East. [DtdH SamM PRS.Rth=] The link was forged by Henri Deterding, the Managing Director of Royal Dutch and the possessor of the finest commercial mind ever produced by the Netherlands (R96a). The three equal partners were Marcus Samuel's Shell. Deterding's Royal Dutch, and the Paris Rothschilds, who supplied Russian kerosene to Shell and Royal Dutch." Asiatic was to combine the marketing organizations of Shell and Royal Dutch and market the kerosene of its three partners all over the Eastern Hemisphere (PL03)-(PL05).9

The "Shell" Trading and Transport Company (PL01)(PL03) was the creation of a Jewish trader SamM (PV01)(PV02). His father, also Marcus
[Greene.Strategies:212/213]
SamM, had begun with a small antique, curio, and bric-a-brac shop in the East End of London in 1833, including geegaws (EC04) for the Victorian household made from oriental seashells. The trade in shells became so profitable that he arranged for regular shipments from the Far East, and developed it into a general import/export business. In 1878 his son took over and not long after began to carry consignments of cased kerosene for "the lamps of China" as a sideline to the shell and general merchandise trade.'" From the (R78) seashell trade came Shell's name and trademark (PL01), its experience with [l&r] worldwide multinational commerce (PL02), and its interests in shipping (PL03), trade and consumer products ([u&d#1=]retail marketing rather than discovery or manufacturing) (PL04). These policies were part of Shell's strategy before it entered the oil business, which it did through its principal businesses, trade and transport (R80a-d),

[Nob.crp=] In 1890 on a trip to the Far East SamM saw some of the first oil wtpt~ being operated on the Black Sea by the Nobel brothers' interests. Realizing the economics of bulk transport (PL05) compared to Standard's method of shipping Pennsylvania kerosene in metal cases by clipper ship, he secured a ten-year supply contract from Rothschild interests in Russia (R92a) and ordered eight wtpt~ (R92b) for shipping Russian kerosene in bulk eastward through the Suez Canal to the Far East (PL S??). He had difficulty in securing permission to send wtpt~ through the canal, partly due to the Standard interests he had outmaneuvered and partly because of the genuine fear that the new wtpt~ were floating bombs. In 1892 the Murex, followed by the Conch, sailed through the Suez Canal to the Far East (EC06) and into competition with both Standard and the Dutch producers in the Dutch East Indies.11 Bulk stations and a marketing network were built throughout the Far East (PL07), but the venture almost failed for lack of demand. Customers were not willing to use their own containers for bulk oil, desiring the blue Standard tins as much as the kerosene. Bright new red Shell tins locally manufactured were soon competing with battered blue Standard tins which had traveled halfway around the world.13

The precedents set by this entry all became important parts of Shell's strategy. Shell entered the oil business as a trader, shipper, and marketer of kerosene (PL03)(PL04)(PL05)(PL07), purchased from low cost Russian sources (PL06), and transported in bulk to the Far East (PL05)(PL07). This strategy was shaped by shipping and Far Eastern trade (R02)(R03), the availability of low cost Russian nrg.pc which made inexpensive, low quality kerosene (EC07)(EC08), the invention of the wtpt (EC05), use of the Suez Canal (EC06), and the competition of Std.crp.nrg (EC09).

 [Shell.crp.nrg=] The Royal Dutch Company for the Working of Petroleum Wells in the Dutch East Indies was formed in 1890 to develop an oilfield (R90) in Sumatra [NDN nrg.p.ggr]. Under the management of J.B. August Kessler a ptpt and a rfnery at Pankalan Brandan began operating in 1892 (R92c). The business of Royal
[Greene.Strategies:213/214]
Dutch was producing and refining in [NDN] the Dutch East Indies (PL08) [good pmp & rfn, but mkt?=]. But it had difficulty with marketing (H01). Kessler hired a young banker and accountant (PV03), DtdH, in 1896, to get, as Deterding put it "...a man whose mind would be sufficiently free from the production bias to enable him to concentrate more readily on the selling end."14 Deterding began building wtpt~, bulk storage points, and a sales organization in the Far East (PL09), getting his start in marketing (PV04).15

SamM's reply was to finagle a cns from the Dutch (R96b) on Borneo in 1896. He struck oil and started a rfnery at Balik Papan (R96c,d) (PL09).16 Almost from the beginning both Shell and Royal Dutch found it imperative to integrate vertically from production through marketing (PL09), Shell to assure low cost sources and Royal Dutch to survive price cutting. By 1897 SamM's oil business had become so extensive that he formed a separate company (R97), the "Shell" Trading and Transport Company (PL01)(PL03)(PL04) to operate it. He also contracted for supplies of a nrg.pc suitable for making gasoline (R98) from a small independent field in Sumatra, adding a second product (PL10).17

The power of the British Empire (EC11) at the turn of the century, the last year of Victoria's reign, was at its zenith in form if not in substance. Germany, with the Prussian army, dominated the Continent, but Britain with her navy dominated the world. Between 1895 and 1899 British merchant ships carried 70.8% of world sea trade.18 In 1898 SamM was knighted for services to the Empire for donating the services of a Shell ship to free a Navy warship that ran aground in the Suez Canal.19 The following year he first formally tried to persuade the Navy to test oil as a fuel, the fuel his own fleet used. With Lord Fisher at the Admiralty, SamM pioneered the use of oil as marine fuel (PL11). For the next 15 years they tried to get the Navy to convert to oil. It was SamM's lifelong dream for Shell to fuel the British Navy, the backbone of the Empire, with oil from its bunkering stations worldwide (SR01)(PV05)(PV06)(PL11) in its days of glory. He even offered control of Shell as Disraeli had taken control of the Suez Canal for Britain.20

SamM was fulfilling the wish in his father's will that his sons "be united, loving and considerate and keep the good name of Marcus Samuel from reproach" (PV06)(PV07).21 Of humble origin and Jewish (PV01)(PV02) all his life he sought acceptance for himself and his family from aristocratic Anglo-Jewry and the Empire more than wealth (PV07)(PV08). An alderman in London since 1892, he became the third Jewish Lord Mayor of London in 1902-1903, the pinnacle of his civic career.

From 1897 to 1901 his business empire also reached its peak. In 1900, bolstered by production in the Dutch East Indies (R96c), he renewed favorably the Russian purchase contract with the Rothschilds (R92b). Shell expanded everywhere and determined to market gasoline in Europe by purchasing a German company from the Deutsche Bank (ROla), cracking the armor of the
[Greene.Strategies:214/215]
Std.crp.nrg, N.crp.nrg, and Rth INX~ who controlled the mkt there.I3  [u&d#1=] When oil was discovered at Spindletop in Texas in 1901, SamM contracted with the J.M. Guffey Petroleum Company (forerunner of Gulf) to purchase, transport and distribute Texas oil as fuel for ships (PL06)(PL11). Shell would take up to half Guffey's production for 21 years at 25c/bbl. plus 50% of the net profits (ROlb), terms quite similar to those between Gulf and Shell in KWT in 1947. Spindletop alone could produce [pmp] as much oil as Pennsylvania—half U.S. output—and Shell had access to it.23 Standard's monopoly could be broken. Shell ordered still more wtpt~. At the end of 1901 SamM's Shell was Britain's largest oil company, second only to Standard worldwide, poised to enter Europe, and the only company with worldwide sources of nrg.pc (PL06). His oil business was barely ten years old,

But SamM's moment of power passed as adverse circumstances accumulated.24 By 1907 he had lost control and 60% ownership to DtdH and Shell.crp.nrg which was I/10 Shell's size in 1901. The difficulties began in 1899 with a Standard-Nobel-Rothschild (EC10) alliance in Europe that threatened to spread worldwide and extinguish Shell. SamM expanded feverishly and took on large inventories at high prices in the rising market. Talks to ally with Dutch producers in the East Indies, including Royal Dutch, were inconclusive, as they had been in 1896, partly due 10 the breakout in 1899 of the Boer war in South Africa between British troops and Dutch settlers (EC13). In 1900 a slump began (EC12). Shell was caught with high priced stocks as prices fell. The aftermath of European intervention in the Boxer Rebellion in 1900-1901 cost Shell its markets in China (EC14)." In 1902 the Navy tried fuel oil with obsolete burners with disastrous results (EC15) and stuck its head back in the sands of tradition and declined the use of oil.J* Also that year the British government of India (then a colony) refused to grant Shell a cns in Burma or relief from tariff on products of non-British companies in the mistaken view that Shell was not wholly British, an insult SamM never forgot (EC16)."' This gave the BurmahOil Company a monopoly in India as Shell, Standard, Royal Dutch and others lost their markets there. The idea that Shell was or might become "foreign" came after SamM rejected Standard's second attempt to buy Shell in 1901 (EC17). To weaken Shell Standard then began the rumor that it secretly controlled Shell.'8 In 1902 Spindletop went dry (EC18) and half of Shell's fleet was idled. It began shipping kerosene from Romania to Germany to keep its four largest wtpt~ employed.w Sir Marcus's civic duties as Lord Mayor left him little time for business in 1902-1903 and the small family management was unable to cope in his absence.10

Meanwhile Royal Dutch was emerging from rough times [that began in 1898].
[Greene.Strategies:215/216] [...]

217=

The Asiatic Petroleum Company, with SamM as Chairman and DtdH as Managing Director, was to be the eastern wing of SamM's vision with the Guffey contract supplying his European distributing organization as the western wing." With Spindletop dry (EC19) and Shell's Far Eastern facilities constrained by the Asiatic partnership with DtdH, Shell's fortunes suffered. A trade slump from 1903 to 1906, a price war by Standard initiated in Europe in 1904, the Navy's refusal to grant Shell fuel oil contracts, and DtdH's control of the Far East forced SamM to the position of having to withdraw from Europe and forfeit the heart of his fleet to the Deutsche Bank. In desperation he opened the question of amalgamation with Royal Dutch, offering equal terms as in Asiatic. But DtdH insisted on nothing less than 60:40 and SamM, in defeat, accepted in 1907. Now Shell was "foreign" and his dreams of supplying the Navy with fuel oil were shattered (PL11)(PV05)(PV06). He felt himself a failure but blamed no one save the government and the Admiralty, for their short-sightedness, and to whom he would gladly have given control of Shell to keep it British and be of service to the Empire (PV06).

SamM, though Chairman of Royal Dutch/Shell, began a brief retirement. But it was not victory over or control of Shell that DtdH and the Royal Dutch wanted. As much as its assets and markets they desired headquarters in London, access to its capital markets and association with the British Empire—Shell's Britishness.'10 DtdH had moved to London in 1902 to set up the Asiatic and had become more British than the British. It was Shell which imparted its name to the group and its products (PL01),

The amalgamation worked out differently than SamM expected.Jl In fact it had brought together a great management team, something neither Shell nor Royal Dutch had ever had separately. Besides Sir Marcus from Shell and his brother Sam, there was Robert Waley Cohen, a Cambridge educated chemist from the Anglo-Jewish aristocracy (PV08) who 1 became DtdH's right hand man; Mark Abrahams, a nephew who had built Shell's organization in the Far East; Walter Levy, a son-in-law (PV07), and others. From the Royal Dutch there came Hugo Loudon, an aristocratic diplomat who had begun as Kessler's driller in 1894, for whom the respect of everyone was so great that he made the amalgamation function smoothly from the start4" and whose personality set the style of the organization (PV09, PL15), a level of courtesy no visitor to Shell can fail to admire today. There were Dutch scientists and geologists (PL12). And as Managing Director there was a genius, DtdH. With DtdH's deft hands at the control of operations SamM was recalled to active duty as elder statesman, counselor on policy, and public spokesman for the organization.

An unexpected result of the system of management Loudon put together was a lack of tension between the British and Dutch.'11 The two parent companies became holding companies owning shares in all the subsidiaries in

218=

the proportion 60:40. A production-refining operating company was set up in The Hague and a transport-storage company in London, reflecting the respective national specialities (PL03)(PL08). Management tended to collect in London because of its preeminent position in world trade. There was little Dutch consciousness of their controlling majority. Perhaps because they were conscious of their dual nationality they were careful to make ability, not nationality, the qualification for a post. If tension arose, it was between London and The Hague, but not between British and Dutch (PL14). This policy produced a remarkable degree of accommodation and respect for national and individual differences which is very evident today.

Royal Dutch and Shell shared an important policy, the "policy of the straight line," DtdH called it,'1'1 from ihe pre-1907 era (PL06). At Royal Dutch it evolved in response to Standard (EC09). The advantage of Royal Dutch over Standard, which purchased, refined, and exported its products from America to the Far East, was that it pmped its own oil and its production was much closer to its markets. To combat price cutting it resolved to deliver on as straight a line as possible, serving only those markets nearest its production. It was the same simple commercial principle of seeking the nearest source of supply to match a local demand (PL06).45 This principle was to guide Royal Dutch/Shell's worldwide expansion.

9.4 1907-1929: Worldwide Expansion

The years which followed the amalgamation were Shell's golden years under DtdH. Shell expanded worldwide geographically in all functions and became a Major. Important policies of openness (PL16) (in contrast to Standard's secrecy), subsidiaries organized by country as indigenous parts of the local economy (PL17). service to the British Empire (PL18). and in the I920s interests in petrochemicals (PL19) and specialty products (PL20) were initiated. Large scale, volume and growth oriented marketing became more important (PL04)(PL05).

Shell expanded vigorously worldwide after 1907. [u&d#1=] It explored and discovered oil in British Borneo (1910). Mexico (1913), and Venezuela (1914). It acquired production in Romania (1906). Russia (1919), Egypt (1911). Trinidad (1913). and California (1913) (R06)-(R14).4" A different source places Egypt in Ihe discovery category, citing a personal interest by Sir Marcus in the area from 1907 because of its strategic location on the Suez Canal and because it was within the British Empire. He never gave up on his dream to serve the Empire (PV06)(PL18). Had the Anglo-Egyptian Oil Company had large production it might have furthered his dream.

Shell was the first oil company to seek worldwide production. One reason was the technological edge its geologists had over the practical oil men used by other companies (PL12). Integrating vertically by geographical area was an

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application of its policy of the straight line (PL06) to minimize costs. Having its own production also, as MlnWL of Gulf concluded,48 prevented Standard from squeezing it with high nrg.pc prices as SamM had experienced in Russia in 1905 (EC02).J9 Geographical expansion also made Shell less vulnerable to local price cutting by Standard (EC02),

Entry into the United States was the most important phase of this expansion and one that was absolutely necessary to deny Standard a secure home base from which it could finance price wars elsewhere. This expansion reflected the view of DtdH, who saw Shell solely as a business engaged in selling oil (PV04)(PV1O) worldwide (PL02) against Standard, as compared to Sir Marcus who sought Shell's greatness by fueling the Royal Navy and appending Shell to the British Empire (PV05)(PV06). A geological survey was carried out in Oklahoma in 1908. but the entry really began after a marketing truce (PL13) from 1907 to 1910 (EC20) broke down. During that truce Asiatic had sold Standard excellent Sumatran gasoline (R98a) which was marketed in California.50

About this time, a famous story goes, DtdH made his first sales in America by sending Shell wtpt~ filled with gasoline steaming past the Statue of Liberty in New York harbor and dumping them at low prices on Standard's doorstep. DtdH confirms the facts but insists there were only two ships which had been diverted from Germany in search of better prices in the ordinary course of business and that Shell did not at that time intend to begin marketing in America. But neither he nor Standard were unaware of the competitive threat implied.

Shell's actual entry began in 1912 with formation of a marketing (PL04) company, the American Gasoline Company, in Seattle (R12b) and secret purchase of producing properties in the mid-continent which became (PL09)(R12b) Roxana Petroleum Company later that year.'" These events occurred after negotiations with the Mln~ of Gulf [MlnWL kin] to form a U.S. marketing combine did not pan out. In 1912 Standard dropped the price of gasoline from I8c to lOc a gallon in California, while maintaining the higher figure elsewhere in the U.S. Unable to sell its high quality Sumatran gasoline profitably in California on its own. Shell began looking for a source of production which could supply gasoline more cheaply by saving shipping charges, the policy of the straight line (PL06). In 1913 DtdH purchased large production in the Coalinga field in California (R13a).

Due to its joint venture character (R07) and the diplomacy required to manage such an organization (PL15), its worldwide scope of operation (PL02), the policy of the straight line (PL06) to minimize long supply routes, and the aim of live and let live toward partners and competitors (PL14), the Royal Dutch/Shell Group took a different attitude toward the management of its subsidiaries and amalgamations than most companies and one certainly different than that of Standard whose subsidiaries, though they had some

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managerial autonomy, were viewed locally as tentacles of the worldwide ictopus and over which there was little local control. The Shell policy set forth by DtdH in 1911, and for which he was responsible, was that the local Shell ubsidiary for each country should be, though ultimately and distantly controlled by the Group, an integral part of that country's economy and an instrument of its social welfare (PL17)(SR03).53 It was, and is, a policy aimed at cooperation and acceptability rather than profit maximization and control.

Another of DtdH's policies in great contrast to Standard's secrecy, secret companies, and secret deals was that of openly stating Shell's intentions md policies (PL16). Compared to the perfunctory annual reports of most American companies before the 1930s, which were rarely more than a balance sheet and sometimes an income statement, DtdH's reports to his shareholders were models of lucidity and candor, compared even to the present, often running as long as 40 pages. Shell's intention to enter the U.S. was published in the Oil and Gas Journal on April 12, 1911, eighteen months before it occurred.54

Between 1911 and 1914 Lord Fisher and SamM were making some headway in converting the Navy to oil with Churchill's assistance.55 But the old suspicions, ever since the Burma incident in 1902 referred to above, prevented it from becoming the Navy's chief fuel oil supplier, though it was Britain's largest oil company. It was to lose that honor to BP.56 An oil shortage and high prices for which Shell was blamed (EC21) were partly at fault, but the main reason was inability to guarantee price and secure supply in long-term contracts. Churchill expressed the government's policy when he charged Fisher in 1912 to "find the oil: to show how it can be stored cheaply: how it can be purchased, regularly and cheaply in peace; and with absolute certainty in war.... "57 On the issue of price Churchill attacked Sir Marcus personally in the House of Commons in remarks that were politically shrewd but anti-Semitic, with the result that the government bought BP and Shell lost out (see Chapter 10 for details).

When war came, however, Sir Marcus had the opportunity to prove (PL18) Shell's loyalty and realize his dreams of fueling the Navy and appending Shell to the British Empire (PV05)(PV06).58 He declared that Shell would make no profit from the hostilities and turned over Shell's fleet of 75 ships to the government while having to charter neutral ships at four times the rate it received from the government. The Dutch, who were neutral, consented and DtdH executed it brilliantly. Twelve Shell ships were sunk, including the Murex, which had first traversed the Suez Canal with bulk oil for the Samuels in 1892. During the war Shell regarded itself as a government agency committed to winning the war rather than as a commercial concern. All this is by way of tracing the wartime origin of an important Shell policy, derived from Marcus Samuel's dreams (PV05)(PV06), to be of service to the British Empire (PL18). It is a very important part of the identity of Shell today as Sampson wrote in

[Greene.Strategies:221]=

1975 of the recognition of Shell executives as a kind of "junior diplomatic service."59 Sir Marcus's dreams came true.

After the war Shell continued its worldwide expansion (PL02), especially in production [pmp] (PL08), under DtdH's management (R96a). In 1918 it was already the world's largest pmper (Table 1-3, Chapter 1). In the Eastern Hemisphere its Romanian properties were destroyed willingly during the war (1916) to prevent German use and soon after (EC22) the Russian producing properties it had purchased from the Rothschilds in 1912 were confiscated. But production was increased in Sumatra and a rfnery built at Sarawak. In the Western Hemisphere rfneries were built at San Francisco (Martinez—1915), St. Louis (Wood River, 111.—1918), and Curacao (1918) in the Netherlands Antilles (R15)(R18). In 1919 Shell purchased Lord Cowdray's "El Aguila" (Mexican Eagle Oil Company), Mexico's largest pmper, and in 1920 set up a joint venture in Britain with BP called Shell-Mex/ BP to market the products (R19)(R20).60

Shell led the way into VNZ, purchasing cns~ from General Asphalt and others in 1913 and [u&d#1=] making the first discovery (R14) at Mene Grande in 1914.61 It was the crowning achievement in the careers of DtdH and the Dutch geologists (PL08)(PL12). In December 1922 the Los Barossos well in the Maracaibo Basin blew out at 100tBd (= thousand barrels per day) and VNZ production began to climb, always led by Royal Dutch/Shell until nationalization in 1976. For nearly half a century VNZ was Shell's largest source of production,

Shell was well balanced [u&d] vertically as well as geographically (PL09). It refined a little less than the 83tBd it pmped in 1918 (some nrg.pc used for fuel oil was not refined) and mkted a little more (from supply contracts before WW1 with Russian and Romanian pmpers and after WW1 with BP—it was BP's first customer). [autos=] Shell rose with the demand for gasoline (EC23)(PL10) from Sumatran, Oklahoma, and Venezuelan nrg.pc~ marketed in the U.S. and Europe and fuel oil (PL11) from Mexican, Californian, and Persian nrg.pcs sold to ships, railroads, and power generating plants everywhere. It had the largest fleet after the breakup of Standard in 1911 as it does today (PL03)(PL11).62 In 1976 it finally surpassed Texaco as the leading US gasoline marketer (PL10).

Other events of the 1920s were less dramatic as Shell steadily expanded. [u&d#1=] It made a major discovery of the Signal Hill field near Long Beach, California in 1921. In 1922 it merged its organizations in the U.S. West and Midwest with Union of Delaware, overextended in the 1920-1921 recession, to form Shell-Union (R22c) owned 72% by Shell and 28% by Union. Union's main assets were not in the East but in Oklahoma and California, including an option on a large block of Union Oil of California stock. It also gave Shell access to American capital markets and placed owernship in Shell subsidiaries in local hands, an important way of making Shell indigenous to the local economy by

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giving its citizens a share of ownership (PL17). Also in 1922 cns~ were acquired in Argentina and a company was formed lo acquire oil rights in Brunei, British Borneo (R02a,b). Shell Company of Canada was formed in 1926 (R26a). TRK.crp.nrg, in which Shell had had roughly a quarter interest since 1912 (R12a). struck oil in Iraq in 1927 (R27). In the U.S. Shell expanded rapidly, becoming the second Major (after Texaco) to market nationwide in 1929 (R29). While nearly half its business was now in the U.S. abroad it was the largest pmper, rfner, and mkter, especially strong in JPN (64% market share in 1935) IND. EEUR WEUR, with wrl-wide volume nearly equal to Std.crp.nrg.NJ's (see Table 1-3 1927, Chapter I). In 1928 it formed joint marketing ventures wilh BP in the Near East and Africa and with BMH.crp.nrg in IND to market their products (R28a,b). G/Achnacarry. With his joint ventures, geographical coverage everywhere (PL02), and these cxx agreements, DtdH had. on paper at least since they never worked very well, nearly achieved his objective of limiting competition (PL13)(PV11) and sewing up foreign markets with Shell.crp.nrg as the world leader. As he had taken as the Group's motto upon the formation of Asiatic in 1903. "Our field is the world"(PL02).

Its product line expanded in Ihe 1920s as well. It set up an (R20a) aviation department to fuel KLM Airlines in 1920 (PL20), eight years before Std.crp.nrg.NJ did so. Diesel fuel, home heating oil. lubricants, and asphalts became significant businesses in the 1920s (PL20, R20b-e). With these additions came a marketing-oriented dedication (Pl.4) to a full product line and strength in specially products (PL20). in contrast to Std.crp.nrg.NJ even in those products whose volume was low. They also represented a desire by the frugal Dutch to minimize waste and by Dutch chemists (PL12) to apply science to upgrade products to their highest value. The Shell Development Company (R26b), a patent licensing and research company (PL12), was founded in 1926. In 1977 Shell was the world's leading lubricant marketer with 23% of the market/6

What would in time become the largest petrochemical company among the Majors [Big.nrg.crp] began with the founding in 1929 of Shell Chemical Company (R29b) to produce ammonia from refinery gases. The reasons were not only Dutch frugality (PV12) and scientific interest (PL12) but also oligopolistic response to Std.crp.nrg.NJ, which had been trying to manufacture isopropyl alcohol since 1920, and I.G. Farben (EC24)(ED25), the German chemical giant who was already coming close to producing a synthetic gasoline from coal (and would do so in 1934)."' DtdH decided that if Farben could enter the motor fuels business with German scientists, Shell could enter chemicals with Dutch scientists (PL12).68

It was nearly at the beginning of the organic chemicals industry. DuPont, an explosives manufacturer, entered chemicals in 1917, Union Carbide and Allied Chemical in 1920, I.G. Farben in 1925, and Imperial Chemical Inc. in 1926. Feedstocks were initially coal and coal tar but the gas, coal and steel companies which produced them were uninterested in small volume chemical operations, thus permitting the chemical companies to grow on their byproducts. Petroleum feedstocks from refinery wastes were desirable because of their greater purity, but the oil companies still nearly missed the boat. Even Shell Chemical today, the 13th largest chemical company, is only half as large as the top five chemical companies.69

With the commitments to petrochemicals and specialty products (PL19)(PL20), particularly asphalt, lubricants, and aviation fuel, and with the achievement of nationwide U.S. as well as global market coverage (PL02), DtdH's edifice was complete. Though they would grow, adapt, and sometimes suffer, all the major policy elements of Shell's strategy were in place by 1929. Their vertical relationships [u&d] were also established as, [nxd & pmp=] despite its worldwide discoveries and position as largest producer. Shell's markets, especially in the U.S. were already growing faster than its production in the I920s.

In the years since its origin the Royal Dutch/Shell Group managed the unlikely combination of achievements of attaining diplomatic status while selling gasoline, marine fuel, and a full line of specialty products, openly, worldwide under a single name and trademark (PL01)(PL02)(PL10)(PL11)(PL15)(PL20). An indigenous cog in each local economy, supplied from the nearest source of production worldwide while fueling and serving the British Empire, Shell became the largest [pmp & tpt] producer and shipper, a pioneer in bulk transport, a large rfner and volume-oriented marketer, vertically integrated to local markets, acquiring a uniquely accommodative view of individual, national, and competitive differences from the circumstance of its two European parents having begun business in Asia (PL03)(PL08)(PL17)(PL18). It was a commercial counterpart of the British Empire on the way to Utopia with all competitors accommodated, none destroyed, with price wars limited and volume steadily expanding, and with the Dutch scientific contribution of expertise to upgrade nrg.pc to products of maximum value—first fuels, then lubricants and specialty products, and soon chemicals (PL12)(PL13)(PL14)(PL19). In its policies there was a sense of public service (SR01) and responsibility to its employees (SR04), to the countries where it operated (SR03). and even to its competitors (SR02). It was pursuing a different social model than the hard-nosed, close-mouthed, laissez faire capitalism often practiced by Rockefeller's minions. [Greene.Strategies:223]

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9.5 1930-Present: Coping with Growth and Change

Until the diversification and nationalization movements of the late 1960s and 1970s Shell's management problems have for the most part been those of coping with growth and change rather than striking out in new directions.

The rapid expansion of the 1920s, especially in the U.S., bought at high prices in a rising market, made Shell vulnerable to the events of the 1930s (EC30). Its U.S. affiliates taken together suffered more than those of any other Major, losing $37m from 1930 to 1934. What was damaging, however, was Shell's response. Cash was hoarded and its large debt load reduced, but also its exploration staff was dismissed and valuable undrilled leases were surrendered even though the U.S. affiliates were nrg.pc short. Except in California and east Texas to a limited extent Shell missed the opportunity to buy nrg.pc rzv~. After 1935 volume and market share as measures of marketing success were replaced by "competitiveness"—the idea (PL21) that Shell's costs in each major market should be in line with those of the lowest cost competitor or the market abandoned. As a result it withdrew from CO ND SD NE OK KS AR NY W.PA, its first withdrawal since SamM's troubles at the turn of the century.

DtdH's career also came to an end in his seventieth year in 1936. Always hot tempered, in recent years he had an increasingly erratic effect on the organization as his autocratic tendencies (PV14) approached megalomania. Worse still, he became pro-Nazi (PV13). The (R10b) confiscation of Shell's properties in RUS without compensation in !917 was an affront he never forgave. He became the world's leading vs-CMN, was burned in effigy in Russia, and until 1927-1928 persuaded other oil companies not to buy Russian oil. One rumor has it that Shell's appearance on the USA East coast was in retaliation for Socony's purchase of RUS kerosene in 1927-1928. Influenced by his RUS (aristocratic and gte second wife and German third wife he came to see the Nazis as the only solution to communism. He became an embarrassment to the diplomatic managers of Shell and was finally eased out and went to live in Germany where he became intimate with Nazi leaders. Hitler and Goring sent wreaths to his funeral in 1939 just before the outbreak of war. After the war the niche in the entrance to Shell headquarters in The Hague intended for DtdH stood empty. So that no one may again tyrannize Shell as DtdH did. the company adopted the present top management structure of a group of three to eight Managing Directors whose chairman is ruthlessly retired at sixty.

Without DtdH's strong hands at the reins, and partly in reaction to him, there was a tendency for the members of the Royal Dutch/Shell group to become less well coordinated, to go their own separate ways. This tendency was reinforced by a variety of factors. The age of the group's first generation of senior managers was one. DtdH's successor, J.E.F. de Kok, died in office in 1939. The hard times of the depression forced each subsidiary to consider its own future (EC30). The policy of localization (PL17) and the appointment of native chief executives rather than expatriates from Britain or the Netherlands gave more weight to local issues. During WW2 the Royal Dutch managers and directors, able to exercise their authority only from Dutch soil, evacuated not to London but Curasao, a location which made coordination with London and the subsidiaries more difficult. The war itself (EC39), centered in Europe and the Far East, cut off communication with more of Shell's properties than with those of any other Major,

WW2 (EC39) also cost Shell more than any other Major. It lost its Romanian production (R06) and 87 of its 180 ships (R92a); its Far Eastern properties were destroyed; and its markets were in disarray. It had cooperated closely with the Allies in the war (PL18) and its U.S. refineries had made especially notable contributions in the provision of aviation fuel (PL20), gasoline (PL10), and fuel oil (PL11). Shell and other large-scale refiners led the way in the (R42) production of 100 octane gasoline for aviation fuel and in catalytic cracking. General Jimmy Doolittle had been Aviation Manager of Shell before the war and was instrumental in the development of long range aircraft. Catalytic cracking and the production of high octane fuel required for high performance flying led Shell's research scientists into the synthesis of aromatic petrochemicals like cumene (in 1942) which were first used as enriching agents to raise the octane rating of gasolines for aviation (PL12)(PL19)(PL20).'!

But as events unfolded after the war Shell became aware of an even greater loss: they were the only Major without pmpion from the enormous new rzv~ in SaA and KWT (H03). They had pmpion only in IRQ in the Eastern Hemisphere after the war (before their Dutch East Indies production was rebuilt). They had fallen from the position of being the leader in the development of new rzv~ and production to being seriously nrg.pc short and at a competitive disadvantage to the new Mideast pmpers with enormous low cost rzv~ (H03). As a partial remedy Shell was able to negotiate the largest long-term purchase contract (R47) in the history of the industry with old friend Gulf.crp.nrg, who was as anxious for markets as Shell was for nrg.pc, in 1947. Shell would purchase half of Gulf.crp.nrg's KWT production up to 750tBd and split the profits with Gulf.crp.nrg. Still this handicap was the most significant fact in the postwar period for Shell.

In the complicated sequence of events that led to this result Shell was a victim of its own policies of cooperation (PL13) and misplaced faith in the British government (PL18). Having bound its competitors with marketing agreements in the period from 1928 to 1932, it let itself be bound by the Red Line [ID] exploration and production agreement [RL.nxd.pmp] after 1928 as its competitors, one

Greene.Strategies:226=

by one, freed themselves to obtain interests in SaA and KWT. It also allowed itself to be outmaneuvered by the British government,

*1913+: Until it could no longer do so British foreign policy was to cordon off the Mideast for BP.crp.nrg, which was its majority owner. The Netherlands had attempted much the same thing in the East Indies for Dutch companies including Shell [Greene.Strategies:226]

*1901+:Actions of ntn.stt~ & crp.nrg~ explained largely by 19th-c power struggles  = control the trade routes to the Far East over which Britain and France, and later Britain and Germany, had struggled since before Napoleon
*--Britain chose the sea route and needed a secure supply of oil to fuel her Navy, the backbone of her Empire. Disraeli in 1875: had bought control from the Khedive of EGP of the Suez Canal, built by the FRNw. GRM, the power of the Continent, took the land roule and built the TRKw BGD.rrd from BGD to BRL. It wanted control of the nrg.p.ggr for i(s rrd~. This explains the activity of the Deutsche Bank in the oil industries of Romania and O.TRK [Greene.Strategies:226]

*1913:TRK-GBR trt a British victory [plt.irx], engineered by Churchill. The fine print brought BP 25% of the future Turkish Petroleum cns and extended Turkey's boundaries eastward into the Persian [IRN] oil regions [Greene.Strategies:226]

*1914:British government bought control of BP. Shell was eventually replaced by BP as operator of the TRKw nrg.p cns. The purchase of BP prevented ENG frm giving equal treatment by to Shell, its largest oil company [Greene.Strategies:226]

*1928+: By relying on agreements like the Red Line [ID] and on a mistaken view of its place in the British Empire (PL13)(PL18), Shell missed out in the really big finds in the Mideast. This is not to downplay Shell's heavy financial commitments in USA and VNZ in the late 1920s and financial difficulties in the 1930s as crucial factors. But just a few years earlier DtdH and Shell were leading the industry into such promising new areas. In the late 1920s and early 30"s they did not [Greene.Strategies:226]

*1946+:In the post-WW2 surge of demand Shell rebuilt and recovered, aided for once by a British Treasury agreement in 1946 (EC46), freeing Shell from exchange controls and permitting oil payments in sterling rather than scarce dollars, a slight advantage over American companies." The Shell story from 1946 (o 1973 is one of growth of marketing volume (PL04) and construction and expansion of large-scale rfneries (PL05), including the world's largest at Pernis (near Rotterdam NDR). Near its refineries Shell built large-scale bulk petrochemical plants (PL05)(PL19). to produce the products resulting from its research (PL12) || Shell enjoyed able leadership in the postwar years from men developed within its own ranks: George Leigh-Jones. Frederick Godber, Sir David Barran, F..I. Stephens, and Sir Frank McFadzean, all British, and J.B. August Kessler, B. Th. Van Hasselt, H. Bloemgarten. F.A.C. Guepin, and L.E.J. Brouwer from the Dutch. Special mention must go to J.H. Loudon, General Managing Director from 1952 lo 1964, who inherited his father's diplomatic skills and healed many of the divisions which had developed in the I930s and during the war [Greene.Strategies:226/227]

The level of coordination between geographical units of Shell was often still imperfect, as for example when the Curacao refinery was dumping products in Rotterdam while European affiliates were trying to maintain prices.' Shell brought in the consulting firm of McKinsey and Company in 1957 to address these organizational inefficiencies which were affecting profits. The role of the Managing Director was redefined, more directors were added, and a number of new positions for Group Coordinators for various functions were created, all no doubt with salutary effect. The nature of this response to lack of coordination was not lo centralize authority or diminish the policy of local autonomy (PL17) but to work a little harder at coordination, || Shell's greatest problem, however, continued to be its shortage (H02) of nrg.pc, stemming from lack of equity in low cost Mideast (H03) production.7* The Gulf contract provided vertical balance after the war but also delayed needed exploration.7' As Shell's markets grew, the gap between production and sales widened. Shell explored worldwide, participating nearly everywhere there was exploration.8" It was often the first to enter new areas, especially those with complicated geological structures. In this its strategy was the opposite of that of BP, which sought large, simple structures. Shell was a leader in secondary and tertiary recovery to get more oil from existing fields and in deep water drilling technology.1" There were two reasons for these tactics. First, being nrg.pc short it had to take more chances than companies with huge Mideastern rzv~ (H03). And second, its efforts reflected its interest in technical expertise (PL12). [Shell u&d#1=] It made its share of discoveries, including positions in Colombia (1945), Canada (1953), Algeria (1956), NGR (1958— with BP). Abu Dhabi (1963), Oman (1964), and the North Sea (1971, 1972). It developed a strong U.S. offshore position in the Gulf of Mexico and made a major discovery of gas with Exxon in 1960 in the Netherlands.82 But on the whole the fields it found were smaller and less profitable than the largest discoveries of the postwar period.91 many made by BP, and Shell did not regain the position of leadership in production it once enjoyed, || Like other oil companies Shell became interested in diversification in the early 1970s and made two significant commitments. It joined Gulf in the disastrous HTGR nuclear venture (R70a), perhaps seeing in the nuclear industry a natural application for its technical expertise and political acceptability (PL12)(PL17). It also acquired in 1970 an old Dutch mining and metals producer, Billiton N.V. (R70b). with tin interests in Thailand, aluminum in Surinam, and coal in Australia.M Two factors in this decision were to use Shell's shipping (PL03) and trading expertise (PL04) in dry cargo businesses like ores and coal.*1 After the wtpt market became glutted Shell hauled grain to Russia in the early I970s as it once had turned its wtpt~ into cattle boats when Spindletop went dry in 1902 [Greene.Strategies:227]

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*--[W] re-Shell & FSCh & Hitler
*2002:Bristol Academic Pr|>Hendrix,Paul|_Sir Henri Deterding and Royal Dutch–Shell: Changing Control of World Oil, 1900–1940| ((SMT search lists kng but then links w/rtl))
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|>Std.crp.nrg|>Std| <>Standard Oil Company| n{}o{Because strategy has its roots so deeply anchored in the past it is quite difficult to explain the strategies of any of the Majors without reference to Standard Oil, the granddaddy of them all. [>Std.chd=] Exxon, Mobil, and Socal are its offspring. Their strategies are dictated by their inheritance from the United States v. Standard Oil, the 1911 vs-fdu case which resulted in the dissolution of Std.crp.nrg into thirty-four companies, nine of which had foreign operations [Greene.Strategies:37]

}f{

The Legacy of Std.crp.nrg
3.1 Effect of Standard on the Majors
3.2 Standard's First Decade: 1871-1881 [Greene.Strategies:37/38]

*1877:1881; [Std.crp.nrg] began gobbling up rivals. The record indicates that Standard followed a policy of purchasing rather than fighting rivals, paying good but not exorbitant prices (PL08). By gaining the goodwill (PL09), as well as the properties, of sellers, future acquisition was made easier. Similarly, by refusing to pay exorbitant prices, future acquisitions were made cheaper and entry for the purpose of selling out at a high price to Standard was discouraged. Standard often took great pains to cultivate the goodwill of competitors (PL09).11 As with other policies, Standard's acquisition policies took a long run view of the business (PL07) [Greene.Strategies:38]

*1881:Standard was dominant in gathering and refining, but it had only limited influence in marketing, and very little in production, aside from its position as a buyer. Trunk ptpt~ were just coming into existence. But through acquisition and expansion by 1881 Standard's net book value had grown to $55 million. [Greene.Strategies:38]

In its first decade a number of important domestic policies had emerged [fnc pmp rzv rfn & tpt]. To Rockefeller and his associates, the petroleum industry was a different kind of business than it was to the pmpers. Standard had achieved control (Exhibit S-l) through its positions in purchasing, gathering, storage, and
[Greene.Strategies:38/39]
refining, and it had a strong position in transportation (PL05)(PV06),14 These were the capital intensive areas of the industry which required large fixed investments and high levels of steady operation to operate efficiently (EC04, PL04,10). There were scale economies to be realized from large size in purchasing, storage, and the logistics of supply as well as in refining. Large fixed investments required a long run view of the business. Rockefeller and his associates were the first to believe in the permanence of the industry. The rise of Rockefeller and Std.crp.nrg, with its strength in supply and refining, and emphasis on steady operation, scale economies, and the long run stands in direct contrast to the vigorous, wasteful, competitive chaos of the producing industry, a group whose organization could have provided a model for the Oklahoma land rush.

One policy consequence was that Standard stayed out of production (PL11). In [1878ap:Std.crp.nrg dtr~] voted not to buy any more producing properties and the same year they decided to dispose of the few existing properties which had come with various acquisitions.15 The instability, rapid exhaustion of properties, inability to gain control, and uncertainty of discovery [u&d#1] were unappealing (PL11).

[fnc over production=] Another policy consequence was that capital intensity, scale economies, a long run view of the business, a variety of businesses, and many partners required a financial view rather than an operating view of the business (PL12). Standard's financial policies were the key to its success. Since there was no price competition within the combination, the aggressive entrepreneurs who joined Rockefeller competed to reduce costs, improve quality, standardize products and processes, develop new refining methods, and raise profits. Duplicate, inefficient, or poorly located facilities were eliminated. In January 1877, the company began self-insurance against fire up to $100,000. Risks were spread over all the activities of the combination and funds flowed from one place or company or function to where they were needed. The most important financial policy was internal financing of all ventures and maintaining liquidity at all times (PL13). As Rockefeller expressed it, "I think a concern so large as we are should have its own money and be independent of the 'Street'."16 No later than 1882 Standard had no long-term debt and no later than 1886 lent far more short-term money than it borrowed." Dividends were modest to permit the accumulation of capital. These policies gave Standard financial strengths that were unmatched by any competitor. And Standard used them. [Greene.Strategies:39]

Aside from its financial policies and view of the business, the most notable difference between Standard and its competitors or even other large firms of the day in other industries was its system of management. In its first decade Standard was an alliance of shareholders, most of whom were aggressively individualistic entrepreneurs who had founded their own companies and still ran them within the Standard fold (PL14). For this reason and the
[Greene.Strategies:39/40]
geographical and functional spread of operations, managerial authority was necessarily decentralized from the beginning. Standard was not a single organization with geographical and functional subsidiaries. It was a confederation of formerly autonomous and competitive units.

Long-term investments required planning; planning required information (PL15). As the organization grew, the information required to make intelligent decisions grew apace. To gather, process, and analyze this information on costs, supplies, market conditions, and competitors, staffs were assembled in New York, Cleveland, and elsewhere (PL16).18 Standard operatives and agents gathered information on every phase of operations and every move by competitors, a practice whose extremes caused as much criticism as spying. [Greene.Strategies:40]

With large-scale, long-term investments, planning requirements, the need for experimentation and information, with so many elements interacting, and with so many strong individuals running their own operations, the task of central coordination was necessarily diplomatic and deliberative (PL17). Consultation and study on decisions took time. Standard reached decisions cautiously and carefully, but once they were reached, it used its financial strength and efficient organization to carry them out vigorously on a scale others could not match (PL18)(PL19). In the 1870s critics opined that since Standard had invested so much in rfneries in the oil region of Pennsylvania, it could not afford to take advantage of the development of trunk ptpt~ and establish large rfneries on the coast. The feasibility of trunk ptpt~ was established in 1879 by others. In 1881 Standard formed National Transit Company and by the next year it had built over 1000 miles of trunkline. Standard was often not the leader in innovation, but it was a vigorous follower (PL19). Once an innovation was proved, Standard was flexible enough to take decisions on as large a scale as it operated (PL20). [Greene.Strategies:40]

It is worth a moment to evaluate the 42-year-old John D. Rockefeller in 1881 at the end of Standard's first decade. He is thought to be the greatest of the robber barons of the nineteenth century. Yet this reputation does not capture his genius. Had he been simply a ruthless competitor, which he may have been, Std.crp.nrg would never have been formed. Rockefeller's genius was not just in his decisively different view of the petroleum industry. It lay in his ability to attract to his organization a number of able and aggressive entrepreneurs— founders, owners, men accustomed to running their own businesses as they pleased, the most independent spirits of the most individualistic period of U.S. business history—to lead them, harmoniously, to a common view of the business, and to organize a system of management that accommodated their differences and effectively used their abilities. Rockefeller did not kill off his rivals. He converted them. One need not condone his nineteenth-century ethics and actions to pay tribute to the genius of his leadership, not only in bringing the pieces of Std.crp.nrg together, but also in laying a foundation of policy
[Greene.Strategies:40/41]
and a system of management whose excellence in developing managers and producing results has stood the test of time. It would be nearly 50 years before Alfred P. Sloan performed a similar task at General Motors. In the world of business, no one had done such a thing before. Except for Sloan in the 1920s and possibly Thomas Watson of IBM in the 1960s, no one has been able to duplicate his accomplishment since.

3.3 Standard's Second Decade: 1882-1891

In its first decade Std.crp.nrg and many of its policies were formed. In its second decade, it matured. There were fewer acquisitions. Operations were systematically studied. Waste and duplication were eliminated. Costs were reduced. In the area of management, it was a decade of consolidation (PL10). [fdu=]

From 1882 until 1892 Standard was organized as a trust (PL21). This change in formal organization occurred in response to a suit won by the state of Pennsylvania upholding its right to tax all of the capital stock and dividends of a corporation operating within the state, not merely those derived from business within Pennsylvania. It was imperative that Standard create separate corporations to hold its properties in each state, and a central legal entity to hold them. These legal difficulties arose in part because corporations were state chartered (there are no nationally chartered corporations in the U.S.) and partly because of the novelty of a corporation which did business and owned assets in more than one state (PL22). [Greene.Strategies:41]

Standard also recognized the need for other administrative changes, including moving its headquarters from Cleveland to New York, its financial and business center, and obtaining more complete control with the reduction of minority interests and administrative simplification. Minority interests could be reduced by inducing minority shareholders to accept shares in a parent organization. The fdu form of organization was selected because it fulfilled these prerequisites and for another reason which was very important to Standard's management, the maintenance of a veil of secrecy over the operations of the combination (PL22).22 The fdu form accomplished the creation of a central office with geographical divisions, the second step on the ladder of organizational advances from proprietorship to multidivisional enterprise, which improved product and information flows and efficiency (PL21). [Greene.Strategies:41]

The Standard Oil Trust [Std.crp.nrg.fdu] held shares in the operating companies and 41 investors held shares in the fdu.23 The legal innovation used by Standard was that the nine trustees were authorized to exercise managerial authority over the operating companies. When one of the nine original trustees chose not to move to New York, the trustees took advantage of a provision of their bylaws to permit the other eight to manage as the Executive Committee.24 The number
[Greene.Strategies:41/42]
required for a quorum was gradually reduced as others were temporarily absent. In practice, as before, the Executive Committee constituted the day to lay management. The concept of management by owners had evolved to the policy of management by an active inside board who met daily to determine what policies and decisions were in "the general interest" (PL23).25

By controlling all appropriations over $5,000, beginning in 1882, the committee controlled the rate of growth of each segment. In 1886 annual reports were required for all salaries over $600 per year and the committee passed on all recommendations for raises.26 Although lines of authority at the top were somewhat vague (due to the legal ambiguities of the fdu form and the novelty of its use by Standard), with these two tools, control over appropriations and salaries (PL24), the Executive Committee controlled the organization. [Greene.Strategies:42]

To focus attention and bring expertise on particular functional issues which affected parts of several of the statewide operating corporations, each with its own limited group of functions, and to relieve the Executive Committee of some of its burden, a series of coordinating committees with advisory powers emerged (PL25). By 1887 the major committees were Manufacturing, Transportation, Case and Can, Export Trade, Lubricating Oil, Cooperage, and Domestic Trade.27 The committees were forums to assess information, gather views, and achieve unanimity. Cooperation was obtained through consultation, discussion, and compromise. Decisions of the committees took the form of requests, suggestions, and recommendations rather than orders to the operating managers of the companies.28 Due to the somewhat undefined legal status of the committees, there may have been legal reasons as well as policy reasons for this deliberative, considerate style of management (PL17). But, in the main, the committee system served admirably to achieve consensus and support for "the general interest" while permitting the delegation of authority to operating managers to manage their businesses, subject to general policy guidance. [Greene.Strategies:42]

The necessary concomitant to a deliberative, decentralized form of management is the ability to act decisively when a decision has been reached (PL14)(PL17)(PL18)(PL20). There were three environmental changes in the 1880s which required such action.

The first was the introduction of trunk ptpt~ at the end of the 1870s. Since Standard was already dominant in the gathering and storage of oil, in purchasing, and in refining, it is only natural that when nrg.pc began to move by pipe rather than rail Standard would move into trunk ptpt~ to strengthen its hold over oil transportation (PL26). It was familiar with ptpt technology from its gathering activities. Negotiating with the railroads had sometimes been difficult and had occasioned criticism. The opportunity to forge a stronger link in the chain was not to be missed. By 1885 the National Transit Company, Standard's trunk ptpt subsidiary, had four lines in operation
[Greene.Strategies:42/43]
which blanketed the industry: one from Pittsburgh to Cleveland which passed through the oil regions; a spur from the oil regions to the Buffalo terminal; a line from the regions to New York; and another to Philadelphia and Baltimore.29 The strategic entry into ptpt~ was to remain a Standard strength and characteristic, through its successors, worldwide, permanently.

Whenever possible the ptpt~ were located on the railroad's right of way, to minimize both lease prices and the cost of hauling building and maintenance materials. To cushion the effect on railroads of loss of oil freight to ptpt~ Standard even gave a rebate of 26% of the transportation revenue to the seaboard to the Pennsylvania Railroad, whether the nrg.pc went by rail or not (PL09).31 Standard's policy, as with other acquisitions was to pay good prices (PL08), a policy rivals sometimes deemed anticompetitive. Another important ptpt policy, also characteristic of its other operations, was that Standard built for permanence (PL07) where some of its rivals built cheaply and hastily. Like National Transit, the Tidewater Pipeline Company had to bury its pipe, when temperature changes caused exposed pipe to whipsaw.

The completed gathering, storing, and transportation system deserves comment because it demonstrates the systematic rationality of Standard's management and the relation of Standard to the largely independent pmpers.33 When a pmper requested a run from the tank at his well to the gathering system, Standard's United Pipeline, a company representative called a "gauger" would strap a measuring device to this tank. The data from the run would be wired to district headquarters where it was credited to the balance of the leaseholder. Royalties to the landowner were deducted and credited to the landowner. Three percent of the volume was deducted as an allowance for evaporation, leakage, and B.S.& W. (bottom settlings and water). An oil certificate was issued for each 1000 barrel lot and fractions were carried on the books as a credit balance. The charge for pipage after 1879 was a flat 20c per barrel, regardless of distance piped. Storage was free for 30 days. After that the storage charge was 1.25 cents per barrel per month. Monthly and annual reports of stocks on hand were publicly issued according to Pennsylvania law. Fire losses were assessed to all owners of credit balances according to the size of their balance. For its accuracy and efficiency in extending gathering systems to new fields, Standard earned praise even from its critics.34 It applied the same thoroughness and dedication to this field (PL12) as it did to preventing price competition and driving out or absorbing competitors. [Greene.Strategies:43]

Oil certificates were traded on exchanges in the oil regions and in New York. Standard purchased almost all of the nrg.pc for its rfneries on the exchanges. In 1885 its rfneries consumed 16.1 million barrels when production was 21.5 million barrels and stocks in storage were 35.7 million barrels.35 It was the largest but far from the only purchaser. Its practice was to pay the average between the high and low price for superior quality nrg.pc~. On at least one occasion it paid a premium price to encourage drilling and
[Greene.Strategies:43/44]
development of production in an area where it had a rfnery. It sometimes paid higher prices in local areas to bid oil away from competitors, raising the cost of their raw material.

It may come as a surprise that in so many instances Standard s policy was based on paying high rather than low prices (PL08). Rockefeller argued that Standard should buy certificates in excess of consumption of nrg.pc when prices were low. Surplus funds earning a low rate of interest should be put to work at his potentially profitable use. They might help to stabilize falling prices. Falling price of nrg.pc was not felt to be in Standard's best interest. It discouraged exploration [nxd], antagonized pmpers, and endangered future supplies. Large purchasers of rfned products, Standard's principal customers, postponed purchases in hope of a lower price, adding to inventory problems. As a large owner of nrg.pc in tanks, Standard also had to be concerned about maintaining the value of its inventories." Hidy and Hidy concluded that Standard did not speculate on the exchanges, aside from purchasing excess nrg.pc when prices were low. [Greene.Strategies:44]

The concern over long-term supplies of nrg.pc (PL07) eventually propelled Standard to take the second major step of the decade: investment in Lima (Ohio) nrg.pc (PL27). Pipeline men with Standard had long wanted to get into [pmp] production. Pipeline loads would be stabilized; competition from other transporters would be less important; public criticism from pmpers would be minimized; and the opportunities for profit appeared large. Rfners, on the other hand, viewed Standard's business as the manufacture of rfned products (PL01).39 nrg.pc was simply raw material in which investment should be minimized. nrg.pc production was a chaotic, unstable business, a speculation better left to others (EC05). [Greene.Strategies:44]

Two factors brought about a change in Standard's strategy of production. Consumption of Pennsylvania oil had begun to exceed its production in 1885 and the prospects for new rzv~ as large as the Bradford field appeared unlikely. But it was the challenge of Lima nrg.pc to the stability Standard had labored so hard to achieve which proved decisive. To retain that stability Standard decided that it had to conquer Lima nrg.pc. [Greene.Strategies:44]

The discovery of Lima nrg.pc in 1884 [u&d#1] challenged both groups within Standard. It was vile smelling, sulphurous stuff, nicknamed (with reason) "skunk oil." It had a smaller percentage of lighter fractions, similar to the petroleum pmped in Ontario, across Lake Erie. It defied refining by existing methods, producing a smaller fraction of inferior kerosene at a cost at least 10 cents per barrel higher than Pennsylvania nrg.pc. It was located in northwestern Ohio (near Lima) and northeastern Indiana, an area geographically distinct from the Appalachian region, which would require a new system of gathering and trunk ptpt~. Standard executives perceived immediately the importance of Lima nrg.pc to Standard's strategy. They could not afford to allow anyone else to handle it; neither could they afford to pay more than it was
[Greene.Strategies:44/45]
worth in the form of manufactured products. As Benjamin Brewster, one member of the Executive Committee wrote, "The question is—how to utilize it and where....We can afford to spend time and money on [the problem] to answer [it] intelligently."42 It was a response typical of Standard's approach to problems (PL12)(PL15)(PL18),

Their first move was to control the nrg.pc. The Buckeye Pipeline Company, organized March 31, 1886, was authorized to construct a gathering and storing system. In June 1886, Standard's purchasing agency began to buy all the oil Buckeye took in, about 85% of Lima Indiana production. Standard then hired Herman Frasch, the outstanding researcher on sulphurous oil, from the Imperial Oil Company, Limited, in Ontario to solve the problem of refining [nrg.pc] "sour" crude. On July 1. 1886 the Solar Refining Company was formed with a plant at Lima to process "sour" nrg.pc. Frasch took longer than expected, until October 1888, to conquer Lima nrg.pc. In May 1889 Standard then began construction on a huge new rfnery at Whiting's Crossing near Chicago (PL04). With a 36.000 barrel per day capacity, the largest in the world, it was designed to supply the entire Mississippi valley. The Whiting rfnery was a monument to the victory over Lima nrg.pc and to the policy of having ample funds available when needed (PL13).

The victory was completed when in June 1889 Standard made its first major investment in producing property with the purchase of the Ohio Oil Company (PL27). In 1888 Standard's total production was only 200 B/D out of 75,649 B/D in the U.S. By 1891 it was 38,994 B/D out of 148,747 B/D, over 25% of the U.S. total (Exhibit S-l).45

By the end of 1891 Standard had invested in Lima nrg.pc $9.6 million in ptpt~, $7.2 million in inventories, $7.3 million in rfneries, and $8.1 million in producing properties, a total of $32.2 million.46 It had also put $14.5 million into other producing properties.47 The cost of these massive strategic investments, a total of $46.7 million, compares to net assets of $55 million in 1881 and $102 million at the end of 1892 (PL20). [Greene.Strategies:45]

The third major event which profoundly affected Standard's strategy was the threat to its foreign marketing by Russian oil (EC06). It led to the bulk distribution of products at home and abroad and the establishment of foreign marketing affiliates (PL28)(PL29). The foreign market was very important. In the early 1880s more than half of U.S. rfned products were exported. Two-thirds went to Europe. Kerosene accounted for more than 80% by value of rfned product exports. Standard handled 90% of the exports." Standard had a virtual monopoly in foreign kerosene, which was shipped abroad in barrels painted blue with white ends bearing Standard's brand names and in cans to the hotter climates. But most sales were through commission agents f.o.b. New York so that Standard's control ended at the edge of New York harbor. [Greene.Strategies:45]

By 1888 Russian kerosene had seized 22% of the world export market.51 With high quality kerosene, highly productive wells, production costs one-
[Greene.Strategies:45/46]
third to one-half those in the U.S., continuous distillation, proximity to markets in Europe and the Eastern Hemisphere, cheaper bulk transport in tank steamers, an internal market for fuel oil which made kerosene a byproduct that could be sold for whatever it would bring, regulations promoting export, and financed by Europeans like the Nobels and Rothschilds, Russian products were formidable competitors to Standard's. Standard met the Russian competition head on. To hold on to market share it cut prices, to the dismay of rfners. It upgraded its services. It did not market inferior kerosene made from Lima nrg.pc abroad. These efforts were to little avail. By 1888 when its volume in the U.K. showed an absolute decline, a more effective response was needed.52

It came with the overhaul in the next three years of Standard's entire system of foreign distribution. Bulk marine transport led to the establishment of foreign marketing affiliates to distribute oil under the Standard brand names in new, efficient horse-drawn tank wagons (PL28)(PL29).

Wilhelm A. Riedeman, a leading German importer of Standard products, [wtpt=] ordered a new vessel, the Giiickauf, which was launched June 16, 1886 (EC07). It carried 20,000 barrels of oil contained in its skin rather than in tanks or barrels. The cost was about three-fourths as much as by sailing ships carrying 5000 barrels each. By 1892 three-fourths of the total export of American nrg.pc and kerosene, except that in cases, was in bulk. [Greene.Strategies:46]

Transport in bulk required a brand name marketing affiliate at the other end to package and distribute the product. The Anglo-American Oil Company, Limited, [>AAm.crp.nrg] Standard's first foreign affiliate, was organized on April 24, 1888 to import and wholesale in the British Isles. The following year it delivered to jobbers and retailers 71% of all American oil imports to Britain. It had also begun selling under its own name to commission merchants throughout the British Empire in the Eastern Hemisphere. [Greene.Strategies:46]

On the Continent the need to compete quickly, the lack of knowledge of the wholesale trade in each country, language barriers, and myriad legal regulations such as restrictions on warehousing and storage permits required alliance with established local merchants, the largest and best managed possible. DAPG, the Deutsche-Amerikanische Petroleum Gesellschaft (German American Petroleum Company), approximately 40% owned by Standard, appeared on February 22, 1890 to market in Germany; the American Petroleum Company (51% owned) (Holland and Belgium) on March 10, 1891; two companies (60% owned) in Italy in 1891; and a 21.45% interest was purchased in a Scandinavian firm late in 1891. [Greene.Strategies:46]

By the end of that year the policies of bulk marine transport and wholesale distribution through partly owned foreign affiliates were well established (PL28)(PL29)(PL33). But, though it had several opportunities. [pmp rfn=] Standard declined to enter either foreign production or refining at this time outside the Western Hemisphere. It is also interesting to note that specialty products such as
[Greene.Strategies:46/47]
lubricants, wax. and vaseline maintained their own separate foreign marketing organizations and had established offices abroad in the early I880s. The older pattern of specialized marketing, a necessity for developing the market for new products (PL30), preceded bulk marketing of kerosene and the establishment of foreign affiliates. It remained at the time of divestiture in 1911, when nine of the thirty-four pieces into which Standard was split had foreign operations, mostly in marketing.

Bulk distribution produced similar changes in domestic marketing between 1889, when Standard had only 252 tank wagons east of the Mississippi, and 1892 when one-third of its kerosene deliveries to retailers were by tank wagon.60 Control of marketing tightened, as minority interests were bought out; control over brands increased; efficiencies of centralization were sought. Prices were set by the general policy of maximizing market share (PL31), a refining oriented policy that would maintain volume and the efficiencies of scale. As Rockefeller put it in 1888, "We want to continue, in reason, that policy which will give us the largest percentage of the business."61 Prices were cut where local or foreign competition required and raised to the limit where it did not. [Greene.Strategies:47]

These incidents show Std.crp.nrg at the peak of its power—a Goliath-moving rationally, deliberately, systematically, using its massive financial resources in the attempt to impose its will on the industry (Exhibits S-l, S-2). They show two other things. Even in the 1880s the industry was already growing and changing too rapidly to be dominated by any single competitor. Also, Standard was never immune to competition. In each of these three incidents Standard's strategy was a response to competition, in spite of all it could do to eliminate it.

Its dominance of the industry, however, was awesome (PL31). Even as late as 1899 it pmped one-third of U.S. production and rfned an astounding 80% of it. If anything, in gathering, storage, and transportation of nrg.pc it was even more dominant. In the export market it marketed the products of other rfners as well as its own, bringing its share of U.S. exports to 90% or more on at least some occasions.

However, because of the nature of channels of distribution this may overstate Standard's position in marketing somewhat. Until 1890, when foreign affiliates were established, marketing consisted of little more than wholesaling at the rfnery gate or New York harbor in branded barrels. All exports were governed by the rules of the New York Produce Exchange, like other commodities then or later.64 Commission agents who handled general merchandise were the main channel of distribution. After the 1880s Standard faced substantial competition everywhere abroad from Russian products. Its share of the foreign market was perhaps only a third of petroleum product sales. It had significant competition from other products and technologies at home and abroad. Not only fats, oil, wood, and coal competed with petroleum
[Greene.Strategies:47/48]
products, but also natural and manufactured gas, rfned products from shale and, most importantly, electricity.65 Even after the establishment of foreign affiliates, Standard was still integrated forward into marketing only to the bulk distribution wholesaling level both in the U.S. and abroad (PL28). Retailing was still done through the general store. Specialized retailing outlets for petroleum products did not appear until the invention of the gas station about the time of dissolution in 1911.

In production its influence was far more dominant than its market share indicates. As MlnWL, the founder of Gulf and a man who had considerable experience with Standard, recalled:

The Std.crp.nrg Company at that time was the only oil company of major importance in existence, but it was not primarily a producing company. In fact, except in California, it had relatively little production of its own and had never made it a general policy to own or control production in a large way because it was practically the sole buyer of nrg.pc oil (PL11).

Consequently, every wildcatter, every lease buyer, every owner of a producing well, was, in effect, a part of the Std.crp.nrg Company's producing department. Whatever price was posted by the Std.crp.nrg Company at the wellhead was the price the producer got for his nrg.pc. Standard made the price.

In saying this I do not mean to imply that the company took unfair advantage of the pmpers whose oil it bought. As a matter of fact, the pmpers who traded with the Std.crp.nrg Company did very well, though some of them grumbled. Nevertheless, these pmpers were at the mercy of this company, which had a complete ptpt system. Normally, this was extended to any new field brought into production. Texas had been a significant exception. So it was to be expected that, as other fields were discovered [u&d#1] and developed. Standard's ptpt~ would be extended to these new fields."'6

MlnWL's response to Standard's strategy is also worth noting:

This prospect did not leave much excuse for anybody to think that he could operate an oil business on a big scale in competition with Standard if he tried to operate in the same way as Standard. I concluded that the way to compete was to develop an [u&d] integrated business which would first of all [pmp] produce oil. Production, I saw, had to be the foundation of such a business. That was clearly the only way for a company which proposed to operate without saying "by your leave" to anybody.

Standard's strategy [l&r and u&d] embraced both horizontal and vertical integration as cornerstone policies from its beginning. It sought and achieved, directly or indirectly, control of each segment of the U.S. industry: production, gathering, storage, transportation, refining, and wholesale marketing. [vs-fdu.lwx=] No organization ever fell more clearly into Section 2 of the Sherman Antitrust Act than did Standard (PL31).

[Greene.Strategies:48/49]

3.4 Twilight of the Combination: 1891-1911

There were fewer strategic changes in the final period of Standard's history. Much of the time Standard was on the defensive legally. Five changes bear mention: the retirement of Rockefeller, the difficulties in Texas, foreign refining and producing, and the rise of  Std.crp.nrg.NJ. Finally, there was the dissolution.

The retirement of John D. Rockefeller from day to day affairs, gradually after 1891 and completely after 1896, was a non-event.69 Though Rockefeller remained nominally president until 1911, the reins of power passed smoothly from the founder to his successor, John D. Archbold, a brilliant, capable, conservative man, testifying to the success of Standard's system of management in developing and retaining extremely able men (PL14)(PL32).

The next was Standard's difficulties in Texas which led to a minimal position there, allowing the rise of Gulf, Texaco, and other companies. The Waters-Pierce Oil Company was majority owned by Standard but managed by one of its founders, a sharp operator named Henry Clay Pierce (PL14)(PL33).70 Pierce had been a thorn in the side of Standard's management since it purchased half of his company in 1878. Pierce's aggressive tactics, excessive profits, and independence were always a source of worry to the [Std.crp's] Domestic Trade Committee. In 1900, as the result of a state vs-fdu suit, the company was expelled from Texas. Partly from the hostility toward Standard in Texas and partly from the impossibility of controlling Pierce, when the MlnWL family, founders of Gulf, offered to sell its producing properties in Texas to Standard in 1902, they received the reply, in an exception to his retirement, that "Mr. Rockefeller would never put another dime into Texas."

The entries into foreign producing and refining were undertaken gradually as competition required and opportunities permitted (PL34). The extent of this activity was rather small until after WW1. Standard had financed a rfnery in Galicia (Poland) in the 1870s for a time. In the 1880s Waters-Pierce had established two small rfneries in Mexico. Standard also owned part of a rfnery in Havana, built to avoid tariffs on product imports. The Imperial Oil Company, an integrated Canadian company, was acquired in 1898.72 DAPG and American Petroleum invested in a rfnery in Germany and later in naphtha re-run plants. In 1904 an integrated operation, Romano-Americana, was established in Romania.73

The organizational changes after 1892 are more useful as a historical determinant of the industry after 1911 than as evidence of strategic change. They show why  Std.crp.nrg.NJ (now Exxon) rather than New York Standard (now Mobil) became the principal heir to Std.crp.nrg after 1911.

Until 1899 New York Standard was the dominant financial unit of the combination.74 It had been the headquarters of the combination since the move
[Greene.Strategies:49/50]
from Cleveland in 1881. It was the banking and financial center as well as the chief exporter.75 Internally it made loans and investments in subsidiaries. Externally, it settled foreign trade accounts and invested the combinations' short-term funds.

As the result of a suit won against Ohio Standard in 1892, the fdu was dissolved.76 Its 92 operating units were consolidated into 20 companies. Taking advantage of a change in 1889 of the state law in New Jersey, which now permitted ownership in the stock of other corporations, Std.crp.nrg.NJ ended up with 21 of the 92 units and became a major part of Standard.77 Shares in the 20 companies were then distributed to fdu certificate holders in proportion to the ownership in the fdu. About half of the holders refused the exchange. The fdu then exchanged all its remaining investments from the unconverted certificates for shares of Std.crp.nrg.NJ. This left each of the 19 companies owned about half by the ten families of major shareholders and half by Std.crp.nrg.NJ, whose shares in turn were owned half by the fdu and half by the families of major shareholders. Since the fdu was prohibited from voting its ownership by the suit dissolving it, the Std.crp.nrg Interests, as they were called from 1892-1899, were held together by the major shareholders who were steadily growing older.7S This confusing arrangement, which would eventually have dissolved the combination as relatives and heirs sold off their holdings, was changed in 1899 when Std.crp.nrg.NJ was recapitalized as a holding company with $196 million79 in net assets and issued new shares for those outstanding in the other 19 companies, both those from the major shareholders and the remaining holders of fdu certificates who now accepted the exchange. Thus Std.crp.nrg.NJ became the parent corporation and the combination was preserved.

In the 1890s Standard was a mature organization and had already begun to reap the consequences of its policies. As an economic organization, it was splendid. Its public image, however, was a disaster. Two decades of secrecy, sharp practices, and size finally brought the giant down.

The American attitude toward Std.crp.nrg was curiously ambivalent, gladly embracing its products, quality, and service and its contributions to their lives, while detesting with equal enthusiasm its abuses. They desired the golden eggs, while wishing to be rid of the golden goose. It is an attitude which executives today must ponder.

Partly it was an expression of American character. Whatever the organization [Std.crp.nrg.fdu] called the Standard Oil Trust or "interests" or combination was, no one, even its executives, was quite sure, but it clearly was not an entrepreneurial organization. It was large and powerful, and often seemed sinister. Americans had won their freedom from political kings and they were not about to subjugate themselves to economic kings in the form of what a generation hence would be called modern corporate capitalism. Large business organizations were going through the throes of being invented, as witnessed by
[Greene.Strategies:50/51]
Standard's numerous reorganizations, and many Americans wanted no part of them. Any unit of power larger than the individual was bound to stir resentment. And Standard did—like no other. The increasingly sovereign American consumer wanted the products of material prosperity set before him in glittering array by numerous, anonymous, silent servants of capitalism. He identified with the products, but never with the pmper.

The end came in 1911 when the holding company was struck down and dismembered into 34 companies. At the time of the dissolution the net value of Standard's assets was
$660 million. The largest piece by far was Standard Oil (New Jersey)
[>Std.crp.nrg.NJ] with
$285.5 million in net assets, followed by Standard Oil (New York)
[>Std.crp.nrg.NY] with
$60 million, National Transit [>NatTran.crp.nrg] with
$52 million, the Ohio Oil Company
[>OH.crp.nrg] with
$44 million, and Standard Oil (California)
[>Std.crp.nrg.CA] with
$39.2 million.80 [...]

3.5 The Strategy of Standard Oil

It is appropriate to close this chapter with a summary of what is meant by a "Standard Oil Strategy" (Exhibit S-5).

Standard's strengths lay in refining, gathering, storage, ptpt~, rail transportation, and finance (PL01)(PL05). It was deeply committed to kerosene manufacture for export as well as domestic trade (PL02)(PL03). It sought worldwide stabilization of the industry under its control, but never quite achieved it (PL06). Its weak areas were new field exploration, production, and fuel oil (PL11). Most of its nrg.pc was purchased (even after 1888) at daily average prices on the oil exchanges (PL08). After 1888 it purchased and developed producing properties but did little wildcatting in non-producing areas (PL27). Until the late 1880s it sold its rfned products for export through commission agents in New York. After that it sold wholesale through foreign affiliates in Europe and Canada. It practiced limit pricing but not monopoly pricing. Its policy was to maximize market share and cut price when it had to (PL06)(PL12)(PL31). It believed in secrecy, narrow legal interpretations, and used its power freely (PL22).

Std.crp.nrg was a financially oriented organization with a large-scale, long-term perspective (PL07)(PL12). Std.crp.nrg.NY and later Std.crp.nrg.NJ functioned like banks, investing loans and equity in subsidiaries, receiving much of their income from interest and dividends rather than from operations (PL13). Standard sought to increase profits by reducing costs and expanding volume (PL12). Its policy was to buy out trouble rather than fight, paying good but not exorbitant prices (PL08). It bought into new areas rather than innovating or starting from scratch (PL18). It was often criticized for paying high rather than low prices for assets (PL08). While often not the first to innovate, it was a vigorous follower (PL19), whose expertise was implementing proven ideas on a large scale (PL04)(PL19).
[Greene.Strategies:51/52]

Standard was managed by an active board of inside directors (no outside directors) through a system of specialized committees (PL23)(PL25). Its management style was deliberative and consultative (PL17)(PL18). Unanimity was sought and usually achieved. Standard kept track of everything that occurred in the industry through a network of its employees, agents, and staff so that decisions might be intelligently made (PL16)(PL18). It was slow to make decisions, but once made, it moved massively to implement them (PL19)(PL20). It acquired and developed able management and decentralized authority to manage operations subject to guidelines in "the general interest" (PL14)(PL32).

Altogether these policies (Exhibit S-4) comprise the legacy of Std.crp.nrg.
[Greene.Strategies:56/57]

Exhibit S-3

Fate of the 34 Standard Affiliates after 1911

1911:Name

1985:Fate

Fate en route

A.    still in independent

existence today

1. Std.crp.nrg.NJ (New Jersey)

Exxon Corporation

2. Std.crp.nrg.CA (California)

Std.crp.nrg.CA

Chevron

3. Std.crp.nrg.IN (Indiana)

Std.crp.nrg.IN

4. The Ohio Oil Company|Std.crp.nrg.OH

Marathon Oil Co

5. Continental Oil Company

Same

6. Borne Scrymser Company

Borne Chemical Co

7. South Penn Oil Company

Pennzoil Company

8. Washington Oil Company

Same

B.    Merged with or acquired

by Standard affiliate

9. Std.crp.nrg.NY (New York)

1931:Vacuum merger

Mobil

10. Vacuum Oil Company

1931:Socony merger

Mobil

11. Anglo-American Oil Company

1930:Jersey Standard acquired

12. South-West Pennsylvania Pipe Lines

1952:National Transit acquired

13. National Transit Company

1965:Pennzoil acquired

14. Eureka Pipe Line Company

1947:Pennzoil acquired

15. Std.crp.nrg.KY (Kentucky)

1961:Socal acquired

16. Std.crp.nrg.KS (Kansas)

1948:Acquired by Standard Oil Company (Indiana)

17. Std.crp.nrg.NE (Nebraska)

1939:Standard Oil Co (Indiana) acquired

18. Solar Refining Company

1931:Sohio acquired

19. Indiana Pipe Line Company

1942:Buckeye acquired

20. Northern Pipe Line Company

1964:Buckeye acquired

21. New York Transit Company

1964:Buckeye acquired

C.    Merged with or acquired

by non-affiliates

22. Chesebrough Mfg Co Consolidated

Chesebrough-Pond's Inc

23. Atlantic Refining Company

1960:Richfield merger

then Arco

24. Cumberland Pipe Line Co, Inc.

1931:Ashland Oil Co acquired

25. Southern Pipe Line Company

1949:Ashland Oil Co acquired

26. Prairie Oil and Gas Company

1932:Sinclair acquired

1969:Arco acquired (some parts to BP & 1973:to Pasco)

27. The Standard Oil Company

Std.crp.nrg.OH (Ohio) (Sohio)

1970:BP merger

28. Buckeye Pipe Line Company

1964:Became division of PennsylvaniaCo, (Penn Central)

29. Union Tank Car Company

Union Tank Car Co., division of Trans Union Corporation

Liquidated or fate unknown

30. Swan and Finch Company

1965c:In liquidation

31. The Crescent Pipe Line Co

1920s:Liquidated

32. Galena-Signal Oil Company

1920s:Liquidated

33. Colonial Oil Company

Fate unknown

34. Waters-Pierce Oil Company

Fate unknown

[Source: Standard Oil Company of California]

Exhibit S-4 Standard Oil Scale Economies
The Conquest of Cleveland

Once their enterprise had been incorporated as the Std.crp.nrg Company, Rockefeller, Flagler and Harkness began a concerted effort to dominate oil refining in Cleveland. Their strategy was to obtain still more favorable rates from the railroads and to do so by taking advantage of the large output of their two rfneries. Sometime in 1870 Flagler offered James H. Devereux, the General Manager of the Lake Shore Railroad (a subsidiary of the New York Central) to ship 60 carloads of oil a day every day if the Lake Shore and the Central would give his company a rate of $1.30 [??] a barrel from Cleveland to New York (the published rate was $2.00 a barrel) and 35 cents a barrel for nrg.pc from the Regions to Cleveland.81 Devereux quickly accepted. As he later testified the assured regular flow permitted him to run a single train daily made up wholly of oil cars instead of putting oil cars on trains mixed in with other types of freight cars. The improvement in scheduling meant that fewer cars were needed. The resulting lower investment and maintenance costs and the small cost of providing a locomotive and crew for the daily trip meant that the railroad could still make a good profit on the rate. Of course, Devereux knew that if he refused, Flagler could certainly get the same deal from the Erie. When other Cleveland rfners protested after hearing of the rate cut, Devereux told them "that this arrangement was at all times open to any and all parties who would secure or guarantee the like amount of traffic or an amount to be treated and handled in the same speedy and economical manner...." But no other Cleveland rfner could guarantee 60 carloads a day.

Armed with this contract Flagler and Rockefeller first invited their two major competitors (Clark, Payne and Company and Westlake, Hutchins and Company) to join forces—an invitation the two readily accepted. Then the Std.crp.nrg approached the other Cleveland rfners. By the end of 1871 five large and seven small firms had sold their properties to Std.crp.nrg and the conquest of Cleveland was practically complete. At the same time to strengthen the position in the all-important foreign market the Standard partners bought Jabez A. Bostwick and Company of New York, a leading exporting firm with a rfnery on Long Island. In Cleveland the larger and more efficient works continued to operate under Standard's control although the change in command was kept secret. Competent rfners like Payne and Bostwick became senior executives of Std.crp.nrg. On the other hand, smaller rfneries not producing specialized products were closed down and their owners had to find a new business.

Source: Affidavit of James H. Devereux in the case of Standard Oil Company v William C. Schufield, el al. quoted in Tarbell. History of the Standard Oil Company 1:277-79; and Case BH 120 "Standard Oil and the Early Development of the American Oil Industry," Harvard Graduate School of Business Administration, 1961

}r{

*1948:NYC|_Standard Oil (New Jersey) and Oil Production in Hungary by MAORT, 1931-1948| ((OWN| A claim to properties and incomes prior to Soviet occupation of MGR))
*1950:Privately printed by SONJ [Std.crp.nrg.NJ]|>Schoenleber,Alvin|_Doctors in Oil|
*1954:|>Standard Oil Company (New Jersey) Std.NJ| "Background Memorandum" (pamphlet)
*1955-1971:NYC,H&brt|_History of Standard Oil Company (New Jersey)| 3vv| ((>HSO| Std.NJ))
*1955:HSO,1|>Hidy,Ralph W.,& Muriel Hidy|_Pioneering in Big Business, 1881-1911
*1956:HSO,2|>Gibb,George S.,& Evelyn H. Knowlton|_Resurgent Years, 1911-27
*1971:HSO,3|>Larson,Henrietta M., Evelyn H. >Knowlton, and Charles S. >Popple|_New Horizons, 1927-50
}s{
Feis.Seen
*1952:FTC
*1962:NYC, Appleton-Century-Crofts|>White,Gerald T|_Formative Years in the Far West: A History of Standard Oil Company of California and Predecessors Through 1919| ((Std.CA))
*1972:MS|>Lenzen,Theodore L| "Inside International Oil"|
*1974:SNT.MC
*1974:LA.NewOrleans, Tulane|>Wall,Bennett H. and Gibb,George S|_Teagle of Jersey Standard| ((Std.NJ))
*1975| G/Anderson,Irvine
API.Facts
*1961je10:Business Week
*1974de07:Business Week.
*1976my:Reader's Digest (condensation)|>Adams,Nathan M| "A Tankful of Gas"
*1977fe01:Forbes
Stricker,Frank's www course outline puts Rockefeller in context with Carnegie and Henry Ford [TXT]
PBS "American Experience -- The Rockefellers" [W TXT & video]
}t{}8{}

 

|>Std.NJ.crp.nrg| <>Standard Oil of New Jersey|>Esso| ((Std.chd))


|>T.bdg.crp <>Transneft

|>Tex.crp.nrg = <>Texaco| n{}o{7ss
}m{
}s{
}t{
}8{}

 


|>TbN.crp.nrg|>Nob.crp.nrg|>Branobel| = <>Tovarishchestvo brat'ev Nobel|>Nobel Brothers| n{}o{
}s{
Dedicated website
Tolf.Nob.crp
}s{}t{}8{}

 

|>TGZ.nrg.nrg = Tengizchevroil [?Tengizshevroil]


|>TRK.crp.nrg = Turkish Petroleum Company
|>Uno.crp.nrg = Unocal

 

|>Yuk.crp.nrg = <>Yukos| n{}o{
}f{
Misamore,Bruce=CFO
}m{
}s{
}t{
}8{}

 

These are code fragments entered here to help avoid code overlaps =

|>D.crp.nrg G/Shell.crp.nrg
|>H.crp.nrg G/BMH.crp.nrg
|>I.crp.nrg G/AI.crp.nrg which went two ways = G/BP.crp.nrg & G/NI.crp.nrg
|>K.crp.nrg G/TRK.crp.nrg
|>N.crp.nrg G/TbN.crp.nrg
|>P.crp.nrg G/AP.crp.nrg G/IP.crp.nrg G/BP.crp.nrg
|>R.bdg G/KBR.bdg.crp
|>RDShell.crp.nrg G/Shell.crp.nrg
|>Z.crp.nrg G/TGZ.crp.nrg

 

 

 

 

MAIN CHRONOLOGY [crn]

Preliminary master crn of nrg eras in the mfgR age =
I.   nrg.c
II.  nrg.a
III. nrg.p
  1. Origins of "majors" up to 1911:splintering of Std
  2. WW1 nrg and causes, course, consequences
  3. Achnacarry| causes, course, consequences
  4. WW2 nrg causes, course, consequences
  5. nrg and CWX = esp. IRN
  6. OPEC and oil embargo
  7. New World Order 1980s-2000
  8. Contemporary era = Our table of Key Concepts [TXT] now seen in hst perspective

IV(A). [enx=] Environmental threats and
IV(B) [enx.c] Energy conservation, and
IV(C) [nrg.new=] the search for alternatives to nrg,c nrg.p nrg.g nrg.x

??Compare big crn abv w/big crn in hst4/515

 

<>1812:LND streets lighted by gas produced from nrg.c by London & Westminister Chartered Gas Light & Coke cmp [W&D,1:32 | Greene.Strategies]
*1830:USA| BST & NYC installed gasworks

<>1846: British government repealed "Corn Laws" to open free trade in agriculture. Potato followed in Ireland [Ecrn]

<>1850:USA cities (N=50) illuminated by nrg.g [Greene.Strategies]

<>1859:USA PA Titusville discovery [Greene.Strategies] [pix] ((nxd u&d#1))
*--Russian merchant Kokorev,Vasilii Axr [G/BXO] invested in first nrg.p production [W]

<>1863:USA Cleveland Excelsior Works of Rockefeller,JD [RckJD] bgn kerosene production (PL01)(PL02)

<>1869:1874; ekn depression (EC01), the second worst in USA history, placed a severe strain upon the oil industry

<>1871:First geological studies of Tigris and Euphrates river drainages [IRQ]
*--Much oil found, but absence of tpt suggested it was not practical

<>1872:RUS AZR Baku =Sale of oil rights made legal [LeVine.Glory=xv ff]

<>1872:Persian territories searched for oil, the first such venture backed by Baron Julius deReuter, founder of Reuters, a British news agency. Under Russian pressure (EC03), DeReuter backed away [Greene.Strategies:237]
\\
Wki

<>1872ap:USA P.PN| Reacting to PN legislature's actions, beginnings of National Refiners' Association [>N.rfn.A] [W&D,1:356-60]

<>1873:CAU Baku region| Robert Nobel arrived, discovered the petroleum possibilities, and invested family business money in oil land

<>1873:1896; The "Great Depression of 1873" began in England and lasted approximately 23 years [Ecrn]

<>1874:1914; Russian industrial combination formed = Association of Southern Coal and Steel Producers
\\
G/McCaffray,Susan

<>1876:Baku Tovarishchestvo brat’ev Nobel|>TbN.crp.nrg| F/Nobel/ and F/Rth/ in Greene.Strategies blw =

<>1877:1881; USA| Std.crp.nrg “gobbled up” rivals and began to build network of trunk and side ptpt~ [Greene.Strategies]

<>1878ap:NY passed "free ptpt bill" [W&D,1:438-9]

<>1880s:JPN Meiji Restoration economic development in its second decade, the beginning of the "Zaibatsu" era
*--CF=Chaebol (S.KOR)
\\
*--W#1 | W#2 | Wki
*--SmfgR4:146 156 158
*--Shibagaki Kazuo, "The Early History of the Zaibatsu" [E-TXT]
*--Kaoru Sugihara, _Japan, China, and the Growth of the Asian International Economy, 1850-1949
*--G/Sil,R

<>1880:Bahrain Shaikh made Agreement with British government [G/899ja23 for similar Agreement]

<>1882:USA oil refining capacity 95% under the control of the giant energy company Std.crp.nrg [This entry from SAC; Std.crp.nrg]

<>1860s:1880s; Kerosene = main product (over 1/2 of all USA oil output; 4th largest USA export)
*--European office of Std.crp.nrg boasted that oil "forced its way into more nooks and corners of civilized and uncivilized countries than any other product in business history emanating from a single source [i.e., this vast new tntn.crp]"

<>1882:1892; USA| Std.crp.nrg called itself a "trust" [G/fdu]

<>1882: Britain's Admiral Lord Fisher first advocated oil fired fleet for Royal Navy [Ecrn]

<>1883:PRS.Rth.bnk formed Caspian and Black Sea Petroleum Co. [Bnito] after Edmond & Alphonsse de Rothschild visited Batumi [LeVine.Glory=xv]
*--Nobel family soon followed with their own company centered on the Baku oil fields
*--Nobels transported nrg.pc to the Black Sea port of Batumi by railroad and ptpt

<>1884ja:U.S. Consular Reports#37| “Petroleum and Kerosene Oil in Foreign Countries” [E-TXT]

<>1885:1901; 15 years characterized by Greene.Strategies =
ASA kerosene demand
Competition from Std.crp.nrg becomes worldwide
Zenith of British MPR enforced by mlt.nvy
Golden age of NDR scs

<>1885: German Gottlieb Daimler developed first workable petrol motor to power a road vehicle [Ecrn]

<>1885:RUS| Large nrg.pc discoveries| ((u&d#1 nxd))
*--RUS was becoming sig. competition for wrl.mkt
*--More than ½ of nrg.p production exported, 2/3 of this to EUR
*--But Std.crp.nrg had not extended its control beyond NYC docks [Greene.Strategies]

<>1886:BMH (Burma, Burmah, now Myanmar [MMR]) bcm part of the ENG.MPR, a gbx of IND| ENG strategic ggr sense stretched IND rule eastward to CHN, then along its coasts. It stretched westward into what we call AfroAsia [ID] through PKS AFG IRN(Iran) IRQ SaA and EGP and the s.shores of Med.S [MDX.S], pinching it at its w. mouth at Gibralter
*--That year the Burmah Oil Company|>BMH.crp.nrg| was formed up in SCT.Glasgow with
the aim to pmp in BMH oil fields [nrg.p.ggr]
\\
*--W#1 |

<>1886je16: GRM Riedeman [F] launched his 1st wtpt
*--nrg.p shipped in bulk via marine wtpt~ [Greene.Strategies]

<>1888:Invention of the marine bulk wtpt [Greene.Strategies]

<>1888: Ottoman Empire [>O.TRK]| Turkish Sultan granted initial cns for the Baghdad railway [>BGD.rrd] to group led by Deutsche Bank
*--Karl Helfferich [Wki ID], GRM fncier, head of Deutsche Bank was made head of the project. [Ecrn]
*--GRM strategic goal = Build rrd thru Tigris & Euphrates valley past BGD to Basra
*--BGD.rrd would end at Per.G port allowing direct sea routes link with GRM colonies in AFR
*--Thus GRM bypassed Suez.C (under ENG control)
\\
*--W-"Trains of Turkey"
*--Wki

<>1888:RUS kerosene dominated 22% of wrl.mkt [HSO,1]
*--Why? Low production costs, near mkt~, gvt support [Greene.Strategies]

<>1888ap24(NS):USA| Std.crp.nrg fnd Anglo-American Oil Company [>AAm.nrg] to mkt in ENG [Greene.Strategies]

<>1889:Iran 2nd nrg.p exploration by Baron Julius de Reuter
*--Found no oil and lost £94,000 [Greene.Strategies]

<>1890:Black Sea| SamM saw a RUS Nobel oil wtpt| Decided to get in this bzn [Greene.Strategies]

<>1890:NDN Sumatra nrg.p.ggr| Shell.crp.nrg [The Royal Dutch Company for the Working of Petroleum Wells in the Dutch East Indies] formed, J.B. August Kessler, manager
*--Deterding,Henri [>DtdH (ID)] a colonial fncier & bnker in NDN and MPR apx [Wki ID] bcm dtr

<>1890:USA TX| MlnWL difficulties competing w/ Std.crp.nrg, so he founded Gulf.crp.nrg [Greene.Strategies]

<>1890fe22:GRM| DAPG, the Deutsche-Amerikanische Petroleum Gesellschaft (German American Petroleum Company), approximately 40% owned by Standard [Greene.Strategies]

<>1891:SamM won contract with Rth~ to sell their kerosene east of Suez
*--Thus Royal Dutch Shell was born [Saul2:143-8 deals with the petroleum industry | Yergin.Prize | Tolf]
*--Shell competed vigorously with Standard in the Far East and Europe from the 1890s on [Greene.Strategies:37]

<>1891:Muscat and Oman Sultan made Agreement with British government [G/899ja23 for similar Agreement]

<>1891: Sergei Witte, Russian Finance Minister under tsar Nicholas II, initiated construction of a Trans-SBRn Railway line linking the whole Eurasian continent, via Russia to the Pacific Ocean [Ecrn]

<>1891mr10:NED and BEL|American Petroleum Company (51% Standard owned), then two companies (60% owned) in Italy in 1891; and a 21.45% interest was purchased in a Scandinavian firm late in 1891 [Greene.Strategies]

<>1892:Trucial Shaikhs made Agreement with British government [G/899ja23 for similar Agreement]

<>1892:Persian [Iranian] oil prospects were described as favorable in a report issued by a French government mission

<>1892:German patent for design of internal combustion engine (1st in GRM) awarded to Rudolf Diesel [Ecrn]

<>1899ja23:Kuwait Shaikh Mubarak signed Agreement with the British Government [Source = Chisholm.First=85] [cns]
*--Similar Agreements were made by the British Government on 3 earlier occasions = G/1880:Bahrain/| G/1891:Muscat/| G/1892: Trucial
*--The Kuwait Agreement was to terminate in 1961 when Kuwait became an independent State. Translation =

Praise be to God alone (lit. in the name of God Almighty) ('Bissiln Illah Ta'alah Shanuho').

The object of writing this lawful and honourable bond is, that it is hereby covenanted and agreed between Lieutenant-Colonel Malcolm John Meade, I.S.C., Her Britannic Majesty's Political Resident, on behalf of the British Government, on the one part, and Shaikh Mubarak­bin-Shaikh Subah, Shaikh of Kuwait, on the other part, that the said Shaikh Mubarak-bin-Shaikh Subah, of his own free will and desire, does hereby pledge and bind himself, his heirs and successors, not to receive the agent or representative of any Power or Government at Kuwait, or at any other place within the limits of his territory, without the previous sanction of the British Government; and he further binds hilnself, his heirs and successors, not to cede, sell, lease, mortgage, or give for occupation or for any other purpose, any portion of his territory to the Government or subjects of any other power without previous consent of Her Majesty's Government for these purposes. This engagement also to extend to any portion of the territory of the said Shaikh Mubarak which may now be in the possession of the subjects of any other Government.

In token of the conclusion of this lawful and honourable bond, Lieutenant-Colonel Malcolm John Meade, I.S.C., Her Britannic Majesty's Resident in the Persian Gulf, and Shaikh Mubarak­ bin-Shaikh Subah, the former on behalf of the British Government, and the latter on behalf of himself, his heirs and successors, do each, in the presence of witnesses, affix their signatures, on this the 10th day of Ramazan, 1316, corresponding with the 23rd day of January 1899.

(sd/-) M. J. Meade, Lieut-Col. Political Resident in the Persian Gulf. (L.S.)
(sd/-) Mubarak-Al-Subah.

Witnesses:

sd/- E. Wickham Hore, Captain, I.M.S.
sd/- J. Calcott Gaskin.
(L.S.) Muhammad Rahlln-bin-Abdul Nebi Saffer.
(Sd.) Curzon of Kedleston. Viceroy and Governor-General of India.
Ratified by His Excellency the Viceroy and Governor-General of India at Fort William on the 16th day of February 1899
(SEAL)
(sd.) W. J. Cuningham, Secretary to the Government of India in the Foreign Department.

<>1892jy:BLK.S Batum via Straights past Istanbul and on through the Suez Canal to Singapore and Bangkok [wtpt]
*--After difficult plt struggle to gain right to ttpt via Suez.C [W&D,1:664-8]
*--Now "Tank Syndicate" success
*--Shell.crp.nrg fnder SamM sent nrg.p on wtpt “Murex”
*--Other ships = Conch and Clam [Greene.Strategies]

<>1892:Sumatra, Pankalan Brandan| Royal Dutch ptpt & rfnery began operations [Greene.Strategies]

<>1893:RUS AZR Baku nrg.p cmp~ formed into snd [stt.cxx] under guidance of Mstt.mny
*--Purpose = aid snd in competition w/Std.crp.nrg
*1893de22:1894my05; Deliberations led Mstt.mny to give price break on Baku-Batumi rrd tpt of nrg.k [MKvN,1:163-166| Von Laue,Witte:108 (w/bbl:317-18)]

<>1893:BLK.S Batum to ASA for storage|SamM had regular tpt wtpt system
*--Std.crp.nrg dropped prices
*--But Shell.crp.nrg survived and prospered w/its wtpt and storage tanks at scattered stations and with its access to cheap RUS nrg.p
*--Another cmp that survived = Royal Dutch [GO 1890]

<>1893:British arbitrarily drew the "border" between Afghanistan and India (Pakistan in our time)
//
*2011fa:WWQ=69
Afghanistan's Fateful Border
THE SOURCE: "The Man Who Drew the Fatal Durand Line", by David Rose, in Standpoint, March 2011.
Background = Wki | Encyc. Iranicaonline (NB! Durand’s assignment to WDC in the critical years of John Hay [ID])

WHEN SIR HENRY MORTIMER Durand left Kabul in the autumn of 1893, his fellow Britons showered him with hosannas. Durand, then serving as foreign secretary of Britain's Indian colony, had succeeded in negotiating the first "scientific frontier" between what are now Pakistan and Afghanistan, a crucial victory in British efforts to contain Russian expansionism. Queen Victoria herself telegrammed congratulations.

Fears of Russian encroachment into Afghanistan had sparked two wars with the Afghans, in 1839-42 and 1878-80, and the British believed that drawing a well-defined frontier and befriending Afghanistan's "Iron Amir," Abdur Rehman Khan (with the help of plenty of cash), would make the country an effective buffer between Russia and British India. A deeper motive was also at work. The British were haunted by the bloody Indian Mutiny of 1857—Durand himself had lost his mother in the conflict— and were convinced that taking decisive steps against the Russians would disabuse the Indians of any notions of British weakness. Durand's biographer wrote in 1926 that "generations yet unborn will benefit from the Durand Line that he negotiated."

[WQu has portrait of dandy Durand w/ this text = Sir Henry Mortimer Durand cut a fine figure, but he made a mess of cutting a border between Afghanistan and Pakistan.]

Of course, it didn't turn out that way. "If Durand had not produced his frontier," writes journalist David Rose, "the conflicts that have plagued the region since the Soviet invasion of 1979 might never have occurred."

Dubbed "the strongest man in the Empire" by London's Spectator, the extravagantly mustachioed Durand was typical of imperial Britons in his slight regard for the people under his sway. In drawing a line through 1,200 miles of some of the world's most rugged terrain, "it simply did not "occur to Durand that the [native] Pashtuns would object," Rose says. When Abdur Rehman complained during the 1893 negotiations about losing the Waziristan region, for example, Durand gave him half of it—noting breezily in his journal, "he will have a bit of Wazir country."

The Pashtun ties of clan, tribe, and faith were far denser than the British understood. Barely more than three years after Durand's triumphant departure from Kabul, Abdur Rehman convened a meeting of Pashtun mul-lahs who subsequently crossed back into British India with Afghan arms and launched the violent jihad of 1897, convulsing most of the northwest frontier. It was only the beginning.

In addition to igniting pro-"Pashtunistan" feeling, the Durand Line contributed to the radicalization of Pashtun Islam. With the jihad of 1897, Rose says, the teachings of Pashtun scholar-priests "decisively changed direction," away from their traditional Sufi-inspired emphasis on "the individual's contemplative relationship with God, and toward one emphasizing strict observance and obedience." Increasingly, militant Islam "provided tribal leaders with their vocabulary and their ideological rallying point."

<>1894:USA Progressive Era pundit [ID] published the following 15 paragraphs about Standard Oil and its international dealings with Russian oil interests [Lloyd.Wealth:442-9, footnotes excluded | G/SAC 1894 R&A] =

When one of the officers of the [Standard Oil] combination was before [the USA] Congress, in 1888, he was asked if there had been any negotiations by his associates with the Russian oil men. the Pennsylvania Legislature that the pipe-line interests of the oil country did not need the regulation by the State then under debate, but were abundantly safeguarded by him and his associates, said: "It may not be amiss for me to say that we have had, at different times during the last several years, most flattering propositions from people who are identified with the Russian petroleum industry, to come there and join them in the development and introduction of that industry. We have declined these offers, gentlemen, always and to this day, and have held loyal to our relations to the American petroleum."

There had been negotiations, after all!

The reports of the United States consul-general at Berlin, in 1891, transmitted many interesting articles from the German papers concerning the alliance which it was believed had been made between the Rothschilds and the American oil combination. A company managed by the great bankers has obtained a commanding position in the Russian oil business, and the American and the Russian were even then said to have divided the world between them. The Berlin Vossishe Zeitung said: "Heretofore the two petroleum speculators have marched apart, in order to get into their hands the two largest petroleum districts in the world. After this has been accomplished they unite to fight in unison, and to fix as they please the selling price for the whole world, which they divide between themselves. So an international speculating ring stands before the door, such as in like might and capital power has never before existed, and everywhere the intelligible fear prevails that within a short time the price of an article of use indispensable to all classes of people will rise [442/443] with a bound, without its being possible for national legislation or control to raise any obstacles."

But some of the closest European observers have seen reasons from the beginning to believe that the Rothschilds are in the Russian oil business only as the agents of the American combination. Thus is freely asserted by the Continental press. The policy of the Rothschilds has been never to engage in commercial enterprise on their own account. The tactics used by the Rothschilds in oil have been an almost exact reproduction of those of the combination in America. From the first they gave the subject of freights their special attention. They showed no ability for new or independent undertakings, but they tried, to use the words of an Austrian-Hungarian consular report from Batoum in 1889, "following the example of the combination in the United States, to get the bulk of the Russian petroleum trade into their hands"; using the large money power at their command for speculation, freely advancing money for leases and delivery contracts, and specially acquiring all the available means of transportation. The experience of the people of Parker is recalled by the statement that the Rothschild company would leave hundreds of cars loaded with petroleum on the tracks for weeks to prevent competitors from shipping and from filling their contracts. When the city of Batoum, in 1888, refused to allow it to lay pipes over the city lands to the harbor, it was with the enthusiastic approbation of the agitated citizens. The authorities gave as their reason that through large establishments of this kind the capitalists gained a monopoly, crushing out smaller producers to the disadvantage of all classes of the population. In the absence of official investigations, a free press, and civilized courts—that knowledge which is not only power but freedom—it is impossible for any one in Russia, or out of it, to know the truth as to the relations of the Rothschilds to the American monopoly. The latest news in the summer of 1894 is of a [443/444] great combination of Russian and American oil interests, under the direction of the Russian Minister of Finance, for a division of territory, regulation of prices, and the like. Information of this was given to the world by that minister's official organ in November, 1893. Thus, says the Hanover (Germany) Courier of November 11th: "With the direct sanction of the Russian government the management of the enormous wealth that lies in the yearly production of Russian Petroleum will be concentrated in the hands of a few firms. . . .The Russian government lends its hand for the formation of a trust that reaches over the ocean—a trust, under State protection, against the large mass of consumers. This is the newest acquisition of our departing century."

It was announced that, in pursuance of this plan, the Russians were to be given exclusive control of certain Asiatic markets. The officers of the American combination are not easily reached by newspaper men. But when this news came long interviews with them were circulated in the press of the leading cities, dwelling upon the "Waterloo" defeat they had suffered, and reassuring the people with this evidence that there was, after all, "no monopoly." The Russian interests are dominated by the Rothschilds, and if the Rothschilds are, as these European observers declare, merely the agents of the Americans, even unsophisticated people can understand the cheerfulness with which the trustees in New York dilate on their Waterloo at the hands of their other self. Only this could make credible the report that the world has been divided with the Russians by our American "trustees," who never divide with anybody. In dividing with the Russians they are dividing with themselves.

Though it is reported that discriminations by the government railroads of Russia were used to force the Russian producers into this international trust, still, at worst, every Russian producer was given by his government the right to enter the pool. But no similar right for the American producer is recognized by our trust. It admits only its own members. The others must "sell or squeeze." There is something [444/445] in the world more cruel than Russian despotism—American "private enterprise."

One of the conditions said to have been made by the Russian government is the natural one that the American trust, as it has agreed to do for the French, must protect its Russian allies from any competition from America. Extinction of the "independents" has therefore become more important than ever to the trust. The prize of victory over them is not only supremacy in this country, but on four other continents. This will explain the new zeal with which the suppression of the last vestige of American independence in this industry has been sought the last few months of 1893 and in 1894. Especially strenuous has been the renewal of the attack on the pipe line the independents are seeking to lay to tide-water, and which they have carried as far as Wilkesbarre (sic.).

That pipe line, as it is the last hope of the people, is the greatest menace to the monopoly. The independents, as they have shown by the fact of surviving, although they have to pay extraordinary freights and other charges from which the trust is free, can produce more cheaply than the would-be Lords of Industry, as free men always do. By means of this pipe line, suspended though it is at Wilkesbarre (sic.), are now made the only independent exports of oil that go from America to Europe. Once let the "outsiders" with their line reach the sea-shore and its open roads to the coast of America and Europe, and it will he a long chase they will give their pursuers. Everything that can be brought to bear by market manipulation, litigation, and other means is now being done to prevent the extension of this line, and to bankrupt the men who are building it through much tribulation. The mechanical fixation of values, by which the refiners who use this line to export oil are compelled to meet a lower price for the refined in New York than can be got for the crude out of which it is made, has been already referred to, and, as shown above, the same prestidigitation of prices is [445/446] being resorted to in Europe against the independents of Germany.

Early in 1894 the independent refiners and producers resolved to consolidate with this pipe line some other lines owned by them in order to strengthen and perfect the system, and put it in better shape to be extended to tide-water. This consolidation was voted by a large majority both of stock and stockholders. But a formidable opposition to it was at once begun in the courts by injunction proceedings in behalf of one man, a subordinate stockholder in a corporation of which the control is owned, as he admitted in court, by members of the oil trust. The real litigant behind him, the independents stated to the court, was the same that we have seen appear in almost every chapter of our story, with its brigades of lawyers. "An unlawful organization," the independents described it to the court, "exercising great and illegal powers, . . . and bitterly and vindictively hostile to our business interests." They came into court one after the other and described the ruin which had been wrought among them, telling the story the reader has found in these pages.

"It is our hope," they said, "when we once reach the salt-water that there will be no power there controlling the winds and the waves, the tides and the sun and moon, except the Power that controls everything. When we once are there the same forces that guide the ships of this monopoly to the farther shore will guide ours. The same winds that waft them will waft ours. There is freedom, there is hope, and there is the only chance of relief to this country. . . . Through three years of suffering and agony we have attempted to carry on our purpose. . . . You could have seen the blood-marks in the snow of the blood of the people who are working out their subscription as daily laborers on that line with nothing else to offer."

The injunctions asked for by this opposition were granted [446/447] by the lower court, but the independents took an appeal to the Supreme Court of Pennsylvania. They first placed their petition for the rehearing in the hands of the chief-justice on Thursday, May 24th; on Monday, May 28th, the petition was renewed before the full court; on Thursday, May 31st, the court adjourned for the summer without taking any action upon the petition. The court in July agreed to hear the case at the opening of its next term, the first Monday of October. Section II. of Article I. of the Constitution of Pennsylvania says: "All courts shall be open, and every man, for an injury done him in his lands, goods, person, or reputation, shall have remedy by due course of law, and right and justice administered, without sale, denial, or delay." To guard against the injustice which might arise by the granting of special injunctions by the lower courts—like that granted in this case—which might remain for months without remedy, the Legislature, in 1866, enacted a law which reads as follows: "In all cases in equity, in which a special injunction has been or shall be granted by any Court of Common Pleas, an appeal to the Supreme Court for the proper district shall be allowed, and all such appeals shall be heard by the Supreme Court in any district in which it may be in session."

As if there had not been enough to try these men, misfortune marked them in other ways. The Bradford refinery of the president of their pipe line was visited by a destructive fire during these proceedings in court. The Associated Press despatches (sic.) attributed the fire to "spontaneous combustion," whatever that may be. But in another newspaper an eyewitness described how he saw a man running about the works in a mysterious way just before the flames broke out. On the same day, by a coincidence, the main pipe of the independent line was cut, and the oil, which spouted out to the tree-tops, was set on fire at a point in a valley where the greatest possible damage would result, and the telegraph wires were simultaneously cut, so that prompt repairs or salvage of oil were impossible. The Almighty is said to favor the heaviest battalions, [447/448] and accident, if there is such a thing, seems to have the same preference, as has been shown in many incidents in our history, such as the mishaps to the Tidewater pipe line, and the Toledo municipal gas line.

An intimation is given in the Continental press as to one of the motives under which the Russian government acted in promoting the alliance between the Russian and American oil men. It desired, it is said, to secure the influence of the powerful members of the oil combination in favor of certain plans for which Russia needed co-operation in America. There has been nothing for which the Russian government has so much needed "sympathetical (sic.) co-operation" in America as for the ratification of the Extradition Treaty. The Russian government has obtained this ratification, and obtained it in a way which indicated that some irresistible but carefully concealed American influence was behind it. The New York World, in its editorial columns of May 25, 1894, made the suggestion that the power behind this treaty of shame was that of the oil trust, earning from the czar the last link in its chain of world monopoly. It asked if it was the influence of the oil combination that induced the Senate's consent to this "outrageous treaty." "Was this one of the conditions upon which that monopoly was permitted to secure its present concessions from Russia? Did it wield an influence in the Senate like that which the sugar trust has since exercised, though for an advantage of a different kind?" The Philadelphia Press points out that the Russian government had long and unsuccessfully sought to obtain the ratification of this treaty, but at last got it quickly and quietly. Did the oil combination, it asks, "succeed in bartering the character of this country as a political sanctuary for the monopoly of the world's markets?" Seldom has any public measure been so universally and so indignantly condemned in America as was this proposal to use the powers of Anglo-Saxon justice to return men who were accused only, and were, therefore, legally [448/449] innocent, to be tried without jury, counsel, publicity, or appeal. Never has public opinion availed less. The Federal executive refused even to delay the ratification in deference to the sentiment against it. Those who were active in the agitation against the treaty found something inexplicable in the unresting and unlistening (sic.) relentlessness with which it was pushed through. Napoleon said that in fifty years Europe would be all Russian or all republican. Even he did not dream that republican America would become Russianized (sic.) before Europe. The San Francisco Call of March 3, 1894, discussing the report that a commercial treaty with China was under consideration at Washington, says the negotiation is in the interest of the oil combination. It warns the public that the trust is willing to reopen the opium trade in reciprocity to China for better terms for the admission of American petroleum. This free trade with China and Russia in the souls and bodies of Russians, Chinese, and Americans would add only another instance of the many manipulations of government which this combination has successfully attempted in all parts of the world—in the tariffs of France, Germany, Cuba, Canada, and our own country; in the raising or lowering of the governmental requirements as to explosiveness of oil sold the people in England and the United States, and in the subsidy legislation by which it got from Congress for its ocean steamers a privilege rigorously denied by law to all other citizens.

<>1895:USA nrg.pc mkt at an end as u&d dominated bzn from nxd through rfn
*--Crude no longer on the open mkt [W&D,1:619-21]

<>1895:1899; British merchant ships carried 70.8% of world sea trade [Greene.Strategies]

<>1896:Royal Dutch manager Kessler hired young banker and accountant DtdH [Greene.Strategies]

<>1896:SamM's reply was to finagle a Dutch cns on Borneo
*--He struck oil there and built rfnery in Balik Papan [Greene.Strategies]

<>1897:Borneo oil business so extensive that SamM formed a separate "Shell" Trading and Transport Company [Greene.Strategies]

<>1897:Shell.crp.nrg Transport and Trading Co. fnd, with SamM 1/3 fxxer [tpt]
*--S refused Std.crp.nrg buyout offer
*--Sig.profits frm JPN, but JPN nothing like USA mkt for Std.crp.nrg

<>1897:1901; Shell’s years of greatest flourish [Greene.Strategies]

<>1898:England knighted SamM for services to the Empire = Shell ship freed a Navy warship that ran aground in the Suez Canal [Greene.Strategies]

<>1898 salt water appeared in Shell.crp.nrg wells and production fell. [drl pmp & rfn=] DtdH became interested in production. As he relates it, there were then two methods of drilling and refining in existence—Russian and American—and the American method was far better || Royal Dutch's drillers and refiners had been imported from America. But they were unscientific, practical oil men, "often exceedingly dictatorial gentlemen of the roughneck breed, with their blue shirts, riveted trousers, and bowler hats—a costume so general among them that it practically amounted to a uniform.... "3I DtdH decided they had to go and replaced them with geologists, chemists, and engineers trained in Europe, often in the Netherlands. Royal Dutch was the first Major to use scientists in production (PL12). though geologists had been used in Russia for 35 years and Standard had begun to employ chemists in refining as early as 1885. " The application of Dutch technical expertise (EC18), in its golden age like other European science late in the nineteenth century, gave Royal Dutch a competitive edge and gave the Dutch an identity as suppliers of expertise on the technical areas of production and refining thai is very much alive at Royal Dutch/ Shell today." It was a brilliant move by DtdH. New production was found, including Sumatran nrg.pc with good gasoline content. With supplies of Russian kerosene DtdH had begun acquiring in 1898 Royal Dutch expanded and began undercutting Shell in the Dutch East Indies, [Greene.Strategies:215-16]

In 1900 Kessler died, leaving as his last wish that DtdH be given complete charge of Royal Dutch. The directors agreed. In that year he obtained his first "working agreement" among Dutch producers. He decided "whenever and wherever possible, a definite system of cooperation with smaller trade rivals must be made an essential part of our business policy—in fact, our main working plan" (PLI3). "Quality and service" he stated, "are the only sure foundations on which competition can survive." Price competition was not competition at all; it was "annihilation" (PV00).' Considering Standard's price policy, this was not an exaggeration. Standard strove to maximize market share by eliminating or absorbing competitors. To do this it often lowered prices in the product or area most important to a competitor while keeping them high elsewhere, subsidizing a war in one area from profits in another. For example Standard sold gasoline in America at £7 17s. 6d. while charging £4 10s. in Europe and also paying the shipping cost to Shell on a charter. Though DtdH (PV11) detested this kind of price competition, even he recognized its value: "If our now friendly competitor. Std.crp.nrg, and one or two more had not gone hitting us by price cutting., .the Royal Dutch might quite conceivably have been a small company, almost unheard of. today."'6

"Working agreements" to keep prices and business steady were DtdH's response to Standard. The Asiatic Petroleum Company in 1903 and then the Royal Dutch/Shell combination [RD/Shell.crp.nrg] described below were such agreements: "it was really close cooperation, and never absorption, at which we aimed," he said (PLI4)(SR02).17 From this viewpoint one can see how Royal Dutch/ Shell became a 60:40 joint venture. This policy stands in contrast to that of Standard of paying generously and decentralizing but never without control." [Greene.Strategies:216]

<>1898: Egypt, Nile River at Fashoda | British forces under Lord Kitchner defeated French troops in an imperialist scramble for authority over North African territory
*--This defeat compelled the French to accept the English plan for an Anglo-French Entente Cordiale against Germany [Ecrn]

<>1899: British treaty with Al-Sabah family of KWT blocked BGD.rrd from reaching the PER.G [Ecrn]
*1899:BMH.crp.nrg bgn wtpt frm  MMR to IND
*--Thus the ENG Committee of Imperial Defense [>ENG.CID] noticed nrg.p issues. BMH only large ENG nrg.p crp in rgn
*--British National Archives www ndx to ENG.CID RXV up to 1914

Chronology (20th century)

<>1899:1914; SamM first formally tried to persuade the Navy to test oil as a fuel, the fuel his own fleet used
*--Over 15y stretch, with Lord Fisher at the Admiralty, SamM pioneered the use of oil as marine fuel and tried to get the Navy to convert to oil [Greene.Strategies]

<>1900s:Russia|>Fenin,Aleksandr memoirs of nrg.c ekn| *1990:D.IL,NIUP|_Coal and politics in late Imperial Russia: Memoirs of a Russian mining engineer|TBy Alexandre Fediaevsky from original Vospominaniia injenera|EBy Suzan P. McCaffray| ((prm vsp tkh nrg.c grn.njn RUS3 plt.clt))

<>1900:Dutch East Indies production encouraged SamM to renew RUS purchase contract with the Rth~
*--Shell expanded everywhere and determined to market gasoline in Europe by purchasing a German company from the Deutsche Bank [Greene.Strategies]

<>1901:Baku supplied 51% of world's oil [LeVine.Glory=xv]

<>1901:1911; Standard and Shell 10y war [Greene.Strategies]

<>1901:USA TX Spindletop, coast of Mex.G| Gusher nrg.p discovered [u&d#1 nxd], creating 2 Big.nrg.p.crp~ =

<>1901my28:English financial adventurer William Knox D'Arcy skirted around Russian objections (EC03) and was granted a 60-year cns on Iranian oil (R0l)

<>1901+:IRQ cns~ sought from O.TRK by D’Arcy

<>1901fa:Shell was Britain's largest oil company, second only to Standard worldwide
*--Shell now poised to enter Europe, the only company with worldwide sources of nrg.pc [Greene.Strategies]

<>1902:1903; LND Lord Mayor was SamM (3rd Jwx to hold that post)

<>1903:1914; RUS Baku|Powerful cxx Nobel/Rth “Nobmazut” controlled sale of about 80% of internal RUS nrg.p mkt and over half the wrl mkt [LeVine.Glory=xv] and thus played big role in irx nrg.p development
*--G/876:Baku | F/1918je blw

<>1904ja:D'Arcy's Persian adventure threatened economic ruin when an early discovery of oil [nxd u&d#1] on his cns dried up

<>1905: British Secret Intelligence agent Sidney Reilly acquired from W.Knox d'Arcy exclusive rights to a major portion of Persian [Iran] oil [Ecrn]

<>1905:Iran.cns.snd [CS.cns.snd] was created
*--BMH.crp.nrg would provide working capital (R05) to find oil in Persia for the Navy (PL04)

<>1905:RUS Baku wage-labor disorder in the midst of the Russian 1905 Revolution results in wide-spread destruction of Nob.crp nrg.p.ggr
*1906:Baku to Batumi ptpt completed [LeVine.Glory=xv]

<>1905:USA OK nrg.p discovered| ((nxd u&d#1))
*1905wi:KS legislature passed laws mandating construction of state-owned rfn & declared ptpt~ to be common carriers [pbl.ptpt] [Johnson.ptpt=22-3]

*1906wi:US HoR introduced "Hepburn Bill" (Wm. P. Hepburn introduced it) declaring ICC jurisdiction over ptpt~ and holding them to be pbl.tpt. [Johnson.ptpt=24-33]
<>1906ap:Shell.crp.nrg transformed by SamM sellout to DtdH and a new twin giant was born
*--Armenian-born (Ottoman Empire subject) and now British citizen, Calouste Gulbenkian played key mediating role & henceforward came to be known as "Mr. Five Percent" [W-ID]

<>1907fe:Complex merger of two rival cmp~

  1. Shell.crp.nrg [Royal Dutch Petroleum Company -- Dutch legal name : N.V. Koninklijke Nederlandsche Petroleum Maatschappij]
  2. Shell.crp.nrg [the "Shell" Transport and Trading Company Ltd of the United Kingdom]

<>1907se21|NYT rpt re-Std.crp.nrg vs-fdu investigations [TXT]= "Standard Oil tells who has its stock | List made public for the first time in Government's Suit to dissolve the Trust | Its grip on export trade | Agreement produced preventing independents from selling for export save to the Standard"

<>1907de:1909se; Iran| British government provided 20 soldiers, led by Wilson, to protect BMH.crp.nrg drillers (EC06)

<>1908my28:Iran first major oil discovery [u&d#1 nxd made by BMH.crp.nrg] on D’Arcy cns [Greene.Strategies]

<>1909ap14:Persia [Iran]| BP.crp.nrg was created. Its original name -- the Anglo-Persian Oil Company, Limited [AP.crp.nrg] -- clearly signalled that it was a British, and thus colonial, company (PL01) founded to develop newly discovered [nxd] Persian oil fields (PL02) =

<>1909ap14:Iran| Anglo-Persian Oil Company (>AP.crp.nrg| aka >APOC) was formed with capital investment of £2m -- £1m for common stock (R05) provided by BMH.crp.nrg, the rest by sale of 6% preferred shares to the public (R09) [Greene.Strategies:239/240]

<>1910:MXO nrg.p discovered [Greene.Strategies]

<>1910:RUS and Shell.crp.nrg made new deals| Shell.crp.nrg fxx- URL-CSP.S nrg.p.ggr, then MXO and VNZ

<>1911:Shell.crp.nrg bought Bnito frm PRS.Rth

<>1911:Iran| AP.crp.nrg 130-mile ptpt to the coast finished [Greene.Strategies]

<>1911:1918; [Greene.Strategies]

<>1911oc:ENG| Winston Churchill (1874-1965) became First Lord of the Admiralty until 1915, after the disastrous WW1 Gallipoli campaign [Wki]. He later became head of the British Imperial Colonial Office (1917ap-1922oc)

<>1911:USA| Std.crp.nrg dissolved, forming 39 cmp~, including Exxon, Mobil and SoCal| 9of24 of the spinoff companies had foreign operations [Greene.Strategies]

<>1912+: Iran| GryCh of AP.crp.nrg pressed the Foreign Office for a subsidy, arguing that Shell.crp.nrg was a foreign company whose loyalty was questionable and whose operations represented a marketing monopoly
*--The Foreign Office was convinced but the admirals were wary of involvement and interested in price
*1911:A public outcry had been raised against high oil prices [Greene.Strategies]

<>1912: Deutsche Bank secured "right of way" mineral rights all along the line of the BGD.rrd, including the area today containing the oil-rich Kirkuk fields of IRQ [Ecrn]. Deutsche Bank was  constantly on the official English mind as a threat to English imperialist dominance and as a powerful financial backer of Shell)

*1912:1913; court cases upheld but, finally at S.sud level upheld lwx  [Johnson.ptpt=76-81]

<>1913:Burton-Humphreys patents for thermal cracking [Greene.Strategies]

<>1913oc:British Political Resident in Persia and Kuwait Sheik Mubarak formally agreed that no Kuwait oil concession would be given there except to a person designated and recommended by the British Government
*--Iran AP.crp.nrg source rfnery on Abadan.I completed [Greene.Strategies (PL07)]

<>1914:TRK.crp.nrg fnd by C.S. Gulbenkian, put together from competing bidders for cns~ in IRQ [Greene.Strategies]

<>1914:IRQ cns~ obtained by AP.crp.nrg when it purchased 47.5% interest in the TRK.crp.nrg (RI4e) [Greene.Strategies]

<>1914:Churchill convinced Parliament to bailout AP.crp.nrg (PL05)(PL08), investing £2 million for just over 50% of the company (EC14b) (R14a) [=Greene.Strategies=]

<>1914:1918; WW1 [Greene.Strategies]

<>1914:ENG gvt, Churchill=apx QrqW, approved purchase of equity in BP to avoid dependence on Std.crp.nrg and Shell.crp.nrg [Greene.Strategies] Churchill fxx- 50% of BP.crp.nrg [CF:1911]

<>1914ap:English Foreign Minister Earl Grey accompanied King George to Paris to meet France's President Poincare and Russia's Ambassador; the three sealed a secret military pact against the German and Austro-Hungarian empires [Ecrn]

<>1914je28:SRB assassin in Bosnian capital Sarajevo killed Austrian Archduke Ferdinand, setting stage for chain of events which brought on WW1 [Ecrn]

<>1915ja:British Government named House of J.P. Morgan in New York to be exclusive purchasing agent in America for British war supplies [Ecrn]

<>1916:Iran RUS oil cns similar to D'Arcy's, covering three of the five northern provinces [Greene.Strategies]

<>1916: Britain and France secretly agreed to carve up the southern territories of the Ottoman Empire under terms of the Sykes-Picot Agreement [Ecrn]

<>1917mr:British Foreign Secretary Balfour outlined in a letter to Lord Rth how Great Britain would support creation of a Jewish homeland in Palestine [Ecrn]

<>1917fa:RUS under SDb gvt bargained w/Teagle of Exx.crp.nrg| RUS nrg.p production = 15% of wrl

<>1918:1927; USA| nrg.pc shortage feared after the war. Rise of the automobile and the gasoline market [Greene.Strategies]

<>1918je:RREV3 SDb pty “ntn.sttized” nrg.p
*--Nobels and Rth~ excluded
*--RUS nrg.p out of wrl.mkt FOR 40 YEARS till 1958c| SIE(Potolov,S)

<>1919:San Remo Treaty allowed FRN CFP to replace GRM Deutsche Bank in IRQ nrg.p bzn| TRK.crp.nrg bcm IP.crp.nrg [Greene.Strategies]

<>1919my:In New York City and London -- as the Versailles Peace Conference was being held outside Paris -- members of the J. P Morgan group, Lord Lothian, Lord Cecil and others of the British Roundtable group [Wki] created two sister organizations = the influential Royal Institute of International Affairs and the New York City Council on Foreign Relations [>CFR | W#1]

<>1919:USA TX Burkburnett and OK Ardmore oilfields | Vida and Erle P. Halliburton formed a company which developed methods of cementing oil wells
*--Soon their company was named New Method Oil Well Cementing Company
*1920ja|USA OK, outside the town Wilson, Skelly Oil Company well came a gusher, spewing untold barrels of oil into the air. [Hlb.bdg.crp=] Halliburton,Erle and his drilling company, New Method Oil Well Cementing Company capped the gusher and launched a legendary company [Briody.Halliberton:8-13]
*--Year later, they were centered in OK Duncan
*1924:"New Method" renamed Halliburton Oil Well Cementing Company (HOWCO)

 <>1920:Iran| AP.crp.nrg purchased RUS oil cns for £100,000 and began negotiating with the Persians for the other two northern provinces [Greene.Strategies]

<>1920:RUS AZR Baku nrg.p.ggr|Gwrx put future of Soviet power in question| So Exx.crp.nrg fxx-out Nobels $11.5m, but SDb power did not collapse
*1920ap28:AZR nrg.p.ggr retaken by SDb troops [LeVine.Glory=xv]
*1920jy30:Std.crp signed deal w/Nob.crp

<>1920:1932; IRQ (Mesopotamia) in turmoil, now freed frm O.TRK rule and declared a separate state administered for 12y as a British mandate [ID LoN "mandatories" system] [Greene.Strategies]

<>1921:Iran revolution overthrew the old regime

<>1921mr21:Cairo Conference convened by British Colonial Minister Winston Churchill [Ecrn]
*--Churchill (seated center) titled this pix of Cairo Conference attendees "The Forty Thieves"
*--Top Mideast experts such as T.E. Lawrence and Percy Cox [Wki] attended
*--Gertrude Bell [ID] is the only woman in the picture
*--The Colonial Office's Mideast Department was formally created in connection with the post-WW1 Mandate system [ID]
*--And the grounds were laid for tragic events over the next near century [hop to SAC LOOP on Iraq]
*--Thus was acknowledging the new strategic import of the oil-rich Mideast
\\
*2004:NYC,Barnes&Noble|>Reeva Spector Simon|_Creation of Iraq: 1914-1923 | *2005my/je:FoA a brief review [TXT]
*--Wki

<>1921no22:Iran(Persia) cancelled RUS cns, on basis of new treaty with USSR, which renounced all previous RUS agreements, including cns~

<>1922:Iran Persian parliament annulled Std.crp.nrg.NJ's cns, [mlf=] allegedly because it had declined to pay backsheesh (bribes) to political circles in Teheran [Greene.Strategies]

<>1922ap10:German Foreign Minister Rathenau and Soviet Foreign Minister Chicherin announced the Rapallo Treaty, a bilateral trade and economic cooperation accord [SAC ID]
*--The announcement shocked delegates at the Genoa international economic conference, which had been convened by England [Ecrn]
\\
*--Wki

<>1922je22:BRL| Rathenau was assassinated by two "right-wing extremists" [Ecrn]

<>1922jy:SSR the target of attempted hostile united front of many nrg.p.cmp~, but Shell.crp.nrg tnx bargaining with SSR [Sampson.Seven=83]

<>1923ja11:French troops occupied critical bordering German regions, Essen and the Ruhrgebiet
*--France claimed that Germany had breached war reparations agreement made at Versailles
*--This act of aggression shut down German industry and triggered the infamous "Weimar inflation" crisis [Ecrn]

<>1923no:GRM | Hjalmar Schacht was appointed Commissioner of the Currency. Schacht was a close friend of Montagu Norman, the Governor of the Bank of England [Ecrn]

<>1923de:GRM government, led by Gustav Stresemann, bowed to pressure exerted from London and New York bankers and refused to appoint Karl Helfferich, unanimous choice to become new Reichsbank President. Hjalmar Schacht assumed the post instead. Helfferich died in a "suspicious" train accident some months later [Ecrn]

<>1924:AP.crp.nrg began to explore for oil worldwide and made a small discovery (R24b) in Argentina [u&d#1]
*1924:ENG granted diplomatic recognition to the USSR
*1926:AP.crp.nrg made a noncommercial strike in Albania
*1930:Both were abandoned [Greene.Strategies]

<>1924:VNZ nrg.p discovered [Greene.Strategies] [u&d#1]

<>1924:1927; As more SSR nrg.p flowed into zpd, Shell.crp.nrg tried to go against the flow and make agreement w/SSR [Sampson.Seven=85]
*--Broke off| These were years in which mxx campaign vs-Std.crp.nrg and Teagle for “trading with CMN” had impact
*--For its part,SSR ws playing one crp vs-another| Std.crp.nrg suffered in this game [G/1941:42]

<>1924ap:German government was forced by economic collapse to accept the terms of the Dawes Plan for war reparation payments to USA, Britain and France
*--Charles C. Dawes, who drafted the plan, was an associate of J.P. Morgan [Ecrn]

<>1925:SSR AZR Baku nrg.p.ggr|Anna Louise Strong wrote about global oil competition [SAC]

<>1925:IRQ cns was arranged which called for a royalty of 4s gold per ton and a minimum rental of £400,000 / year in gold. Bribes were paid (PL03), and threats were made by the British government (EC06) before the cns agreement was signed. It was the first tonnage-based royalty in the Mideast (R25) [Greene.Strategies]

<>1927:1938; nrg.pc shortage turns to 11y glut during Great Depression [Greene.Strategies]

<>1927oc14:IRQ Kirkuk oil discovery, AP.crp.nrg's third major discovery [u&d#1]. It demonstrated its growing expertise in finding oil (R27c). A local rfnery was built [Greene.Strategies]

<>1928:SCT| Achnacarry Agreement| Royal Dutch Shell, AP.crp.nrg and the American Rockefeller group formally signed their "truce" which they called the Red Line Agreement and which divided the entire Mideast among them [Ecrn]

<>1929oc:"Black Friday" New York Stock Exchange crash triggered accelerated liquidation of dollar investments in Germany and Austria [Ecrn]

<>1930:RUS-USA|Armand Hammer left with great cache of pre-REV RUS xdj (Fabergé and icons)
*1920s: Hammer bzn = RUS bzn—mdx (portable mlt hospital), trd (mpt wheat for furs, caviar, etc), and pencil zvd
*--WW2 distilled alx,sold out to Schenley and Publicker Industries
*--1957:Hammer bcm prx Occ.crp.nrg [8x11:nrg]

<>1930:USA E.TX nrg.p discovered [Greene.Strategies] [u&d#1]

<>1931my:OST WEN|Creditanstalt collapsed, triggering domino collapse of Austrian and German banking and industry
*--Sharp increase in unemployment, and the rise of political extremism [Ecrn]

<>1932: Paris negotiations between Sweden and Germany to extend major new loan to the German government were interrupted when Swedish industrialist and banker Ivar Kreuger was found dead under suspicious circumstances in his hotel room [Ecrn]

<>1932: Independent British and Indian group, the British Oil Development Syndicate (BOD.snd), acquired a 75-year cns frm IP.crp.nrg (formerly TRK.crp.nrg)

<>1932:Iran Shah annulled the D'Arcy cns unilaterally (EC32)

<>1933:Iran cns~ earlier granted AP.crp.nrg renegotiated because of two earlier developments =

<>1934:IRQ AP.crp.nrg ptpt to MDX.S completed [Greene.Strategies]

<>1938:1950; CAS major nrg.p discovered [Greene.Strategies] [u&d#1]

<>1938mr18:MXO xfxx- or “ntn.sttized” nrg.p [Wki | Greene.Strategies] Nationalized holdings of the Mexican Eagle Petroleum Co. [Wki] and other Dutch, English and US holdings. Eventually created PEMEX [Wki]

<>1938:KWT| AP.crp.nrg and Gulf made major discoveries on the Arabian side of the Per.G [u&d#1] where geologists earlier thought there was no oil
*--AP.crp.nrg was now positioned in 3 of the 4 huge Mideast producing areas, but nowhere outside that region [Greene.Strategies]

<>1939:1945; WW2

<>1939mr:Bank of England Director, Montagu Norman, saw to the transfer of Czech gold to Nazi GRM which at this time occupied Czechoslovakia [ID]
*--1939no:In the first weeks after the outbreak of WW2 on the Western Front (and after England had declared itself at war with Nazi Germany), Norman again transfered Czech gold from the Bank of England to Nazi banks [Wki]
*--Ecrn claims that Norman also transfered funds from the Bank of England earlier, in 1933, with the purpose to support Adolf Hitler in the early months of the Nazi radical-rightist and dictatorial regime
\\
*--[W]

<>1940:USA Pittsburgh coal smoke documented in photos [W#1 | W#2 | W#3]
*--Try to search out on the internet Margaret Bourke-White's 1955 photo of smoky Pittsburgh from the air. She's a great photographer
*--[Return to main SAC LOOP on "coal"]

<>1941:1942; USA SNT investigation of Std.crp.nrg's early-WW2 relationship with the German chemical corporation I.G.Farben

<>1941au:Iran Reza Shah refused to expel Germans

<>1943:S.Arabia nrg.o potential the subject of the DeGolyer rpt| Foundations were being laid for the massive shift of post-WW2 EUR, nrg.c to nrg.p [Greene.Strategies]

<>1944:English channel crossed by ptpt to supply fuel to future Normandy Beach invaders [YouTube]

<>1944jy01:jy22: Bretton Woods monetary system [fnc] devised what came to be called the Bretton Woods System
*--The International Monetary Fund [IMF] was established [Ecrn] [Wki]
*--The New Hampshire resort where the deliberations took place [pix]
*--Britain's Lord Keynes and American Deputy Treasury Secretary Harry Dexter White worked out the final details of a new postwar world order
\\
*--[Wki]
*--Council on Foreign Relations economist Benn Steil|_The_Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order| ((CFR rvw ))
*--Clark.Petrodollar

<>1946mr:Winston Churchill traveled to President Truman's home state, to Fulton, Missouri, to unveil postwar British proposal for Cold War against Soviet Union [Ecrn] [ID]

<>1946+:After the war the British pushed the Russians out of Iran with difficulty and installed the 22-year-old son of Reza Shah as a puppet (EC45)

1947ja31:Texas Eastern Transmission Corporation fnd [G/TX.E.ptpt G/Briody]

<>1947:SoCal and Texaco fxx- 40% of Aramco [Greene.Strategies]

<>1947:Exxon and Mobil enter SaA. Shell and FRN cmp~ were shut out [Greene.Strategies]

<>1947:CAS realignment [Greene.Strategies]

<>1947:KWT [Greene.Strategies]

<>1948:India ndp (EC48a) weakened the British military position east of Suez [Greene.Strategies]

<>1948:1951; Future US President George Bush worked for Dresser Industries
The elder George Bush later formed his own company, Zapata Corporation [ID]

<>1948no:VNZ arranged new 50/50 profit sharing cns w/oil cmp~ (EC48b) [Greene.Strategies]
*--crp.nrg cmp~ sometimes described this cns as 50% income txx

<>1950:1960; Pax Americana = Europe and Japan recover from WW2
*--USA bcm net importer of nrg.pc
*--Center of gravity of nrg.p production shifted, Western Hemisphere to Eastern Hemisphere [Greene.Strategies]

<>1950de30: Aramco signed a 50-50 profit sharing agreement with the SaAn government (EC50), replacing the tonnage royalty

<>1951ap28:Iran Prime Minister Mohammed Mossadegh assumed position of central importance in situation with weakend Shah and discredited AIOC (ECS1a ??)
*--Greene.Strategies adds this interpretation =

Mossadegh was “a fanatic” riding a wave of anti-British (EC46a) and anticompany (EC46b) feeling. The company had offered to change the supplemental agreement along the lines of the 50-50 agreements but to Mossadegh nationalization was the only solution. The supplemental agreement was never considered. [AI.crp.nrg=] "What the Anglo-Iranian Company did was sheer looting, not business," cried Mossadegh, who had never set foot in the oil fields in his life. Facts refute the charge. In addition to its commercial activities, which employed 70,000 Persians at £20 million a year and pmped £16 million for the Persian government in 1951, the company had built 30 schools, a technical college, three hospitals, 35 dispensaries and nearly alt the public health services in southwest Persia, 1250 miles of roads, 40 bridges and from 1945 to 1950 alone £28 million in housing. It was probably more than the government had done for the area and it showed a clear commitment to social as well as commercial responsibilities (PL06)(PL10)(SR01)(SR02). The company was justifiably proud of its accomplishments and thought appreciation was in order. It thought of itself as more than a commercial enterprise which nxd- and pmp- oil. It was an empire builder which brought civilization to the natives (PL01). Neither were the financial results unreasonable. From Mikdashi's figures on profits and payments and dividends from annual reports, a calculation not adjusted for inflation shows that from 1909 to 1950 of the £492.2 million in profits before taxes and royalties. 22% went to the Iranian government, 35% to the British government in taxes, 20% to shareholders including the British government as dividends, and 22% was retained by the company. In 1950 of £99.8 million. 16% went to Iran, 51% to Britain in taxes, 7% in dividends, and 26% was retained. By relative comparison the terms Iran received were not less favorable than other Mideast governments received. They were considerably better than the one-eighth royalty to leaseholders customary in the United States. With the supplemental agreement or a 50-50 agreement they would be better still. There appears to be no factual basis for the charge of looting by the company. Quite the contrary, it was clearly doing more for Iran than was required to conduct its business (SR01)(SR02). In terms of services rendered for payments received, only the British government and perhaps the Iranians appeared to be engaged in looting. The cry for nationalization could not be defused by these facts. It was, perhaps more than anything, a reaction against British colonialism (EC06). The company's special relationship (R14C) became a severe handicap (H01). The colonial mentality, the national role the company felt it had played in Persia, was a unique combination of profit and public service (PL01)(PL06)(PL10). But it did not contemplate stirrings of independence, of relinquishing the white man's burden. Some of the policies which expressed this philosophy (PL13)(PL14) produced as much or more resentment as others (PL06)(PL10) did praise [Greene.Strategies]
*--Engdahl.War sd this =

<>1951ap30:Iran Majlis [elected parliament] voted to nationalize the oil industry (EC51b)

<>1951my:USA.stt.dpt announcement = Because of nationalization, American companies wld not deal in Iranian oil
*--Other Majors followed in an effort of the big powers and big companies to freeze Iran out of world markets [Greene.Strategies]

<>1951jy01:Iran oil exports had ceased

<>1951oc04:Iran free of British AIOC

<>1952je24:USA Attorney General Memorandum [...] relative to [...] the international oil cartel [TXT] G/Blair.Control ((tntn.nrg.cxx))

<>1953:Italian industrialist Enrico Mattei promoted passage of a law creating an Italian state petroleum company (ENI) in order to secure national control over oil and gas resources [Ecrn]

<>1953ja:WDC| Report by the [USA] Departments of State, Defense and the Interior on petroleum. [TXT]

<>1953jy:USA CIA engineered Iran coup which toppled Mossadegh (EC53) [Wki]

<>1953au:Iran was the target of Operation AJAX. The objective was to readmit British and American oil companies to Iran and re-establish their control over Iranian crude oil [Ecrn]

<>1953se10:USA.stt.dpt, Richard Funkhouser revision of pre-Operation AJAX 53jy03:memo [cns stt&crp] [TXT]

<>1954au:Iran| USA.stt.dpt brokered Agreement on a consortium to operate the Iranian nrg.p.ggr and rfnery on a 50-50 profit sharing basis with NI.cmp.nrg (EC54)

<>1954de:AIOC, the change in its position irrevocable, changed its name to British Petroleum [BP.crp.nrg]

<>1955:Iran| Aminoil, Getty, Iricon gain cns~ in CAS Mideast [Greene.Strategies]

<>1957:Enrico Mattei settled a "revolutionary" oil development agreement with Iran
*--1957:In tight competition with Esso and Shell, M also helped finance ALG ndp mvt vs-FRN with an eye to gaining favor with future ndp possessors of ALG rzv~
*--These bold moves angered the world’s major petroleum companies, those whom Mattei dubbed “The Seven Sisters” | G/7ss
*--The US domestic economy underwent the first severe recession since the end of WW2 [Ecrn]

<>1958:BP acquired AK Prudhoe Bay leases (R58f) which contained over half the rzv~ of the North Slope discovery in 1968 (R68) [u&d#1]
*--Purchases were made through BP North America (in Canada) when David Steel headed it [Greene.Strategies]

<>1958: General Charles DeGaulle became President of France, and among first acts in office was a call for a historic meeting with German Chancellor Adenauer [Ecrn]

<>1958jy14:IRQ| Free Officer's Movement seized power frm ENG-installed mnx in name of greater IRQ ndp frm EUR MPR| New Premier Brigadier Abd al-Karim al-Qasim [ID] opened negotiations with Iraqi Petroleum Company [IPC G/Q.crp.nrg] but made no headway

<>1960:1970; A decade of Mideast production glut
*--Golden age of the automobile and cheap energy
*--Rise of petrochemicals [Greene.Strategies]

<>1960:1961; TX Dallas became new HQ of renamed Halliburton Co.
*1962:Halliburton purchased Dallas construction company “Brown and Root”

<>1960se:USA CIA assigned task of organizing murder of Fidel Castro, Prime Minister of Cuba and Commander in Chief of the Cuban revolutionary armed forces [Wki]
*--Later McGeorge Bundy testified on this issue [YouTube]

<>1960oc:Mattei, for ENI, signed a historic oil-for-technology exchange agreement with the USSR
*--M also negotiated with The People's Republic of China on similar agreements
*--Anglo-American oil companies strongly opposed M's independent entrepreneurial moves [Ecrn]
*--Mattei publicly announced that the USA mpy was over

<>1961:IRQ claimed KWT & assembled troops on KWT border
*--ENG sent light mlt counter-force & IRQ backed off

<>1961de15:IRQ passed Pubic Law 80 [>lwx80], "a turning point for Western oil companies" throughout the Mideast" [15]
*--Not full nationalization of all oil enterprise, but did lay claim to all IRQ nrg.p.ggr
*--"The Seven Sisters" punished IRQ by freezing them out of expanding oil bzn [Muttitt.Fuel:15-17]

<>1962:Shell.crp.nrg chm (1956-65) London,John nrv by Sampson.Seven=236
*--L = “Jonkheer” and British knight
*--”I don’t know why,but oil always seems to have a smell to it…. [T]he dogs may bark,but the caravan moves on.”

<>1962fe02:LIFE MAGAZINE ad extoled the heating power of Humble Oil and Refining Company products = "EACH DAY HUMBLE SUPPLIES ENOUGH ENERGY TO MELT 7 MILLION TONS OF GLACIER!" [View the ad]
TXT = This giant glacier has remained unmelted for centuries. Yet, the petroleum energy Humble supplies — if converted into heat — could melt it at the rate of 80 tons each second! To meet the nation's growing needs for energy, Humble has applied science to nature's resources to become America's Leading Energy Company. Working wonders with oil through research, Humble provides energy in many forms — to help heat our homes, power our transportation, and to furnish industry with a great variety of versatile chemicals. Stop at a Humble station for new Enco Extra gasoline, and see why the "Happy Motoring" Sign is the World's First Choice!

<>1962oc27:Enrico Mattei died in plane crash
*--Mattei was scheduled only a few days later to fly to Washington for meeting with USA President John Kennedy
*--Kennedy was urging American oil companies to reach a detente with Mattei on global oil policy [Ecrn]
*--Later investigations of the crash that killed Mattei revealed that an explosion brought the plane down

<>1963ja:French President Charles DeGaulle and Federal Republic of Germany ["West Germany"] Chancellor Konrad Adenauer signed the Élysée Treaty, a Franco-German cooperation agreement [Ecrn] [W-ID]
*--Significant "Western" allies showed surprising independence from the dominant Cold War position of USA

<>1963fe:IRQ gvt overthrown & al-Qasim dth.a by Ba'ath Party [>B.pty]
*--Likely CIA support [according to Jordon King Hussein]
*--B.pty used CIA lists to decimate strong IRQ CMN.pty
*--7ss pleased, but B.pty was quickly overthrown by mlt & IRQ nrg.p again in IRQ hands

<>1963no:US President John F. Kennedy was assassinated [Ecrn]

<>1965:Shell.crp.nrg after DtdH now the most irx of all nrg.p.cmp
*--Shell.crp.nrg apx had 7 dtr~ at head;
*--Shell.crp.nrg uthlessly retired executives at age 60
*--VNZ bcm most crucial source of post-WW2 nrg.p
*1965:1967; Shell.crp.nrg chm = Brouwer,Jan (NED njn)

<>1965:ENG PRL (H.of.Lords) decided case in favor of BMH.crp.nrg [Wki], granting the cmp compensation for damages to their SE.ASA properties done by ENG mlt (in its efforts to keep the nrg.p frm falling into JPN hands in WW2)

<>1967:Shell.crp.nrg chm bcm Barran,David,Sir (NED dvr) ssn of dtr of Shell.crp.nrg’s VNZ operation
*--Shell.crp.nrg evolved fdr apx = Deutsche Shell, Shell Indiana, Shell Senegal
*--USA Shell HQ in Houston (30% USA fxx-)
*--Shell.crp.nrg fdr,but with firm Anglo-Dutch control
*1960s:Shell.crp.nrg irx shareholders [Sampson.Seven=14] =
39% = Brit
19% = USA
18% = NED
24% = Other

<>1967je05:je10; :Six-Day War [W-ID] closed Suez Canal
*--Vulnerability of the Suez Canal stimulated development of super wtpt~ and huge coastal rfneries [Greene.Strategies]

<>1967je:French President DeGaulle announced French withdrawal from "gold pool" arrangement [fnc] formed to support over-valued Sterling and Dollar parities [Ecrn]

<>1967no:English Pound Sterling suffered a massive run [fnc], causing a crisis in the Anglo-American Bretton Woods monetary system [W-ID] and forcing devaluation of the Pound Sterling, the first such devaluation since 1949 [Ecrn]

<>1968:IRQ B.pty again in power via coup

<>1968:1972; SSR AZR trader Ara Oztemel hired then after 4y, fired James Giffen [LeVine.Glory]

<>1968ap:Stockholm meeting of the Group of Ten [fnc]| France rejected the American proposal for "paper gold" currency scheme [Ecrn] [W-ID]

<>1968my:USA and British intelligence launched [!?] the French "May '68" student strikes and [fnc] promoted rumors of French Franc instability to destabilize French government [This an amazing Engdahl.War claim] [SAC]

<>1968:Shell.crp.nrg orx-smn~ to try to understand std rdx [Sampson.Seven=14]

<>1969:Twrl direct investments by USA [Tanzer.Political:?] =
40% nrg.p related
60% of all USA cptist earnings in Twrl frm nrg.p
*1969:USA OH Cleveland| The Cuyahoga River burned [enx]

<>1969:PRS| Charles DeGaulle stepped down and was replaced by Georges Pompidou [Ecrn]

*1970+

<>1970my:AER:225-45 [fnc=]|>Wolff,Richard D., Theotonio Dos Santos (unv of Chile), and Harry Magdoff [Wki ID] on oligolopistic corporations and their effort to control international markets
*--Based on USA dpt of Commerce,Survey of Current Business
*1950:1968; foreign cpt of USA based crp~ (IE:direct rather than portfolio investment) grew from
$12b to
$65b
Net income (minus cash outflow) =
$15b
*--Dos Santos: “...the relations of dependence to which these countries are subjected conform to a type of international and internal structure which leads them to underdeveloment or more precisely to a dependent structure that deepens and aggravates the fundamental problem of their peoples” [231]

<>1970:USA production and rzv~ peak and begin to decline [Greene.Strategies]

<>1970s:Shell.crp.nrg (and Gulf.crp.nrg) lost big on nrg.n projects

<>1970:1980s; Producing country governments take control of production and pricing [Greene.Strategies]
*1970no:IRQ| Sadam Hussein regime switched to selling oil for euros rather than dollars [Clark.Petrodollar sd this=defining moment for contemporary Iraq]

<>1971:NDN Aceh ["A-chay"] nrg.p &nrg.g.ggr discoveries by Exx.crp.nrg [u&d#1]. Indigenous folks almost from the very beginning organized to resist Exx.crp.nrg

<>1971:Teheran| Producing country governments take control of production and pricing [Greene.Strategies]

<>1971au15:US President Nixon announced a unilateral withdrawal from Bretton Woods Gold Exchange [ID], initiating era of "floating exchange rates" [Ecrn]

<>1971de:McGeorge Bundy and Ford Foundation began major study of global energy strategies
*--Study eventually claimed that a world energy crisis was imminent, despite the promise of nuclear energy [nrg.x] as a substitute for oil [Ecrn]

<>1972je01:IRQ under B.pty leadership nationalized Q.crp.nrg

<>1972je:Canadian oilman and financier Maurice Strong [Wki ID] was chosen [ecx=] to head the Stockholm UN Conference on the Environment which funneled millions of dollars into creation of a new anti-industry and anti-nuclear "green movement" [Ecrn]

<>1973:OPEC| Producing country governments took control of production and pricing away from 7ss
*1973oc17:OPEC embargo followed [Greene.Strategies | LeVine.Glory]

<>1973+:After the OPEC Crisis hit (EC73) Shell reassessed the profitability of a number of countries in which it marketed and, in a repeat of the 1930s, exited [Greene. Strategies:224/228] from 20 or so, including ITL and ones like VNZ in which its operations were nationalized

<>1973my:Sweden, Saltsjoebaden | The Bilderberg Group [Wki] convened a secret meeting to discuss problems of "petrodollar recycling" under projected 400% increase in world oil price [Ecrn]

<>1973je:Trilateral Commission created by David Rockefeller and others [Official website | Wki | Ecrn]
*--That year Michel Crozier, Samuel Huntington and Joji Watanuki published The Crisis of Democracy: Report on the Governability of Democracies to the Trilateral Commission [digitized TXT]

<>1973oc:USA Secretary of State Kissinger intrigued [sic, Ecrn wordchoice] to trigger "Yom Kippur War" between Israel and Arabs
*--This war precipitated the 400% oil price shock anticipated by the Bilderberg group the spring before [G/73my] [Ecrn]

<>1974:US Government adopted Kissinger draft of National Security Council Memorandum 200 [NSC-200] [E-TXT]
*--NSC-200 declared as official US Government policy a plan to control rate of growth, especially of population, in the Third World
*--This was declared to be a US "national security" priority [Ecrn]

<>1975wi:USA created Strategic Petroleum Reserve [SPR, str.rzv~] [www]

<>1975: German government of Chancellor Helmut Schmidt won parliamentary approval for a major nuclear energy program, similar in scope to that of France, as a response to increases in oil import costs
*--Spain and Italy also announced a major nuclear power commitment in wake of oil shock
*--In NYC that same year, CFR began its "Project on the 1980s" which called for a "controlled dis-integration of world economy", and other measures [Ecrn]
*--The"Project" published many studies, including Øystein Noreng's Oil Politics in the 1980s: Patterns of International Cooperation, which was reviewed in the major journal of CFR, Foreign Affairs [ID]

<>1975ap:Lyndon LaRouche, Jr., proposed a global International Development Bank (1) to channel long-term credit to "Great Projects" in key sectors of developing regions, and (2) to revitalize world industrial development [Ecrn]

<>1976au:Sri Lanka, Colombo | Non-Aligned Summit meeting adopted a proposal calling for further economic development and for a moratorium on the interest burden borne by Third World economies hit by oil shock depression [Ecrn]

<>1976se:Guyana Foreign Minister Frederick D. Wills brought the Colombo Non-Aligned proposal before UN General Assembly in New York. Wall Street stock market went into sharp decline [Ecrn]

<>1977ja:Mitsubishi Research Institute of Japan proposed a Global Infrastructure Fund to finance large infra-structure projects in key areas in the developing sector to revive industrial investment [Ecrn]

<>1977jy:German banker Juergen Ponto was assassinated
*--Soon after, the head of the German Industrial Association, Hans-Martin Schleyer was kidnapped & murdered [Ecrn]

<>1978se:German Federal Republic Chancellor Helmut Schmidt and French President Giscard D'Estaing initiated Phase One of the European Monetary System to stabilize European currencies in wake of growing dollar instability [Ecrn]

<>1979:KZX TGZ.crp.nrg.p.ggr discovered [u&d#1]| G/96sp:production figures

<>1979ja:British Petroleum and US intelligence launched a full-scale destabilization of Shah of Iran
*--Produced the Second Oil Shock of the 1970s.
*--Shah was forced to flee Iran [Ecrn]

<>1979mr:USA, PN, Harrisburg | A deliberate [sic Ecrn wordchoice] tampering produced the "Three-Mile Island" nuclear incident which inspired a massive anti-nuclear scare in USA [Ecrn]

<>1979my:Austria | The Bilderberg group met again, this time to endorse the theocratic Muslim state under Khomeini [Ecrn]

<>1979my:English conservative government was formed by Prime Minister Margaret Thatcher
*--Within weeks she imposed drastic monetary "shock therapy" to "squeeze inflation out" of the British economy
*--Unemployment doubled over the next few months [Ecrn]

<>1979my15:Executive Intelligence Review#6,19, a publication by the excentric and sometimes laughably intemporate group of macro-analists led by Lyndon LaRouche, Jr.
*--EIR published a headlong but detailed and nearly unique exposé of the CFR's "Project on the 1980s" [E-TXT]
*--As politics in the global 1980s unfolded, we can see some parallel with pop-arts in that era = Heavy Metal, indeed [ID]

<>1979jy16:IRQ ruled now by prx Saddam Hussein [>HsnSdm]
*--Muttitt.Fuel:vi gph of 1960:2010; IRQ share of wrl nrg.p production shows what HsnSdm and his 3 wrx~ accomplished for IRQ oil enterprise

<>1979oc:Paul Volcker implemented Thatcher's British "monetary shock" policy in US
*--Sent interest rates above 20% for an extended period [Ecrn]

<>1979no:US elections sent Reagan-Bw1 Republican ticket to the White House
*--Reagan was committed to "free market" policies similar to Thatcher’s [Ecrn]

<>1980s:2000; Greene.Strategies’s predictions=
?Transition to new energy sources
?Major new discoveries [u&d#1]
?Economic stagnation
?Soviet Union becomes dominant world power

<>1980se02:1988au20; IRQ invaded Iran & awful wrx dragged on

<>1981:State of World Atlas #1| ((>SoW.ch1))

<>1982ap:Prime Minister Thatcher proposed "gunboat diplomacy" ??to enforce collection of debt from Latin American countries
*--The Falkland Island conflict with Argentina was made the "test case" for new NATO "out-of-area" military intervention [Ecrn]

<>1982su:CIA "engineered" ?? explosion of SSR ptpt [04fe27:ERG clipping]

<>1982au:Mexico announced it was forced to default on servicing its foreign debt, triggering global "Third World Debt Crisis" [Ecrn]

<>1982se:Mexican President Lopez Portillo nationalized banks in partial emergency response to outward flight of capital [Ecrn]

<>1982oc:USA Secretary of State George Shultz in UNO speech announced "Reagan recovery" policy
*--This policy triggered a speculative consumer and real estate boom similar to the 1920s in US
*--As a result, domestic debt ratios expanded in a dramatic manner for the next seven years
*--At this time the Reagan Administration signed the Garn-St.Germain Act which removed prior regulatory controls on US Savings and Loan banks [CF=S&L career of Neil Bush]
*--Thus restraints were removed on yet further speculation in real estate [Ecrn]

<>1984:Dedmon,Emmet, _Challenge and Response: R.R. Donnalley &Sons Company

<>1884:S.KOR began to use the word "Chaebol" to describe their burgeoning state-supported industrial conglomerates [Wki]
*--CF=1880s:JPN

<>1984:New State of World Atlas #12 [SoW.ch12] nrg.c xpt [8x11:nrg]
25.0% (ca. ¼) of wrl total trd is nrg.p
08.5% (ca. 1/12)of wrl total trd is SaA nrg.p
wrl nrg consuption =
39% nrg.p
26% nrg.c
17% nrg.g
01% nrg.a

<>1984:SoW.ch13|International mvt of nrg.g trd in equivalences to mT nrg.p
20 gt USA frm CAN
3 gt USA frm MXO
2 gt USA frm AFR Morocco
25 in all
44 gt W&C.EUR frm SSR
21 gt W&C.EUR frm NOR
9 gt W&C.EUR frm ALG
74 in all
11 gt JPN frm INZia
6 gt JPN frm MLZ
3 gt JPN frm ARABIA
1 gt JPN frm USA
21 in all
3 gt SSR frm AFG

123 total

<>1984:OPEC mmb~ =
ALG
BHR
Equador
Gabon
INZ
Iran
IRQ
KWT
LBY
NGA
SaA
Qatar
UAEmirate
VNZ

<>1985:1986; WDC signed secret pact with SaA to further stimulate US consumer credit boom via dramatic lowering of oil prices. This facilitated a sharp further fall in US interest rates which lasted some months [Ecrn]

<>1986ap:USA VP Bw1 traveled to Riyadh to signal a halt in the lowering of oil prices
*--Lower prices had by then accomplished their task (?what task) [Ecrn]

<>1981ap15

<>1987oc19:Reagan-Bw1 speculative bubble burst, the most dramatic one-day fall on Wall Street since "Black Monday" [ID] [Ecrn]

<>1988jy03:USA Naval force in the Per.G shot down an IRN civilian airline airbus, killing all 290 aboard
\\
*--Wki

<>1988no:1992; Bw1 defeated Michael Dukakis to become president. [Ecrn]

<>1988de01:In the air over Lockerbie Scotland| Terrorist bomb brought down PanAm civilian airliner, killing 270 (including 11 on the ground)
\\
*--Wki

<>1989se:USA CIA Director William Webster unveiled a new "economic directorate" of CIA to redefine role of US intelligence agency in "post Cold War" era [Ecrn]

<>1989no09:Berlin Wall opened, preparing the reunification of two Germanies, as well as opening of all Eastern Europe [Ecrn]

<>1989no29:Deutsche Bank chief Alfred Herrhausen was assassinated days after giving a media interview on his program for reindustrializing East German economy
*--Several close advisers to Chancellor Kohl (including Herrhausen), all involved in aspects of the pending German unification, were targeted for assassination (?by whom) [Ecrn]

<>1989de:USA Bw1 Administration invaded Panama on pretext of capturing Manuel Noriega on allegations of drug dealings
*--Preparations were also underway for entrapment of IRQ's HsnSdm
*--The Bw1 Administration cut off all credit to IRQ [Ecrn]

<>1990:SoW:40|Proved nrg.g rzv~ (tcM) [CF:1984]
USSR 52.000 (40%)
Iran    17.000 (12%)
CAN     7.578
ARG     7.154
UArEm 5.492
SaA      5.135
USA      4.930
Qatar    4.621
ALG      3.250
IRQ       3.115
VNZ      2.992
INZia     2.423
NOR      2.295
AUSrlia  2.170
MXO      2.060
MLZ      1.485
KWT       1.370
LBY        1.218
INDia      1.100
CHN       1.000
total    128.412

<>1990mr:KWT Emirate, "acting on request of Washington" [?], launched economic pressure on IRQ by flooding markets with cheap oil in violation of OPEC accords. SaA privately concurred in this action [Ecrn]

<>1990jy07:USA Ambassador to Baghdad IRQ, April Glaspie told HsnSdm that Washington regarded IRQ-KWT territorial dispute as "not of strategic interest to USA", clearing away the obstacles to Iraqi invasion of KWT [Ecrn]

<>1990au02:IRQ invasion of KWT provided pretext for Bw1 Administration’s Operation Desert Shield
*--This = the largest US military operation since Vietnam [Ecrn]

<>1990de:Financial World:38-40|>Kindel, Stephen| "For Want of a Pipeline"|((ptpt nrg.p nrg.gn| Today, Amo.crp.nrg has become the largest domestic pmper of natural gas, pumping more than 3.6 bcF of natural nrg.g a day, mainly from the Gulf of Mexico. Gas rzv~ of 18.9 tcF are reported, more than any other domestic pmper. The strategy of nrg.gn production seems smart given the decreasing supply of nrg.gn and an increase in demand. The only problem is that much of the nrg.g rzv~ are located in hard to reach places often where ptpt capacity is inadequate. Even if the ptpt were started in 1991, it could cost Amo.crp.nrg $200m in nrg.g sales))

<>1991fe:Schachner, Michael. "Amoco Studying Cover for Oil Pool Cleanup." Business Insurance:12-14 [ecx]
*--Tests show that there may be about
16.80mGallons of various petroleum products beneath its plant in Whiting, Indiana
*--Officials feel it is likely that some of the pool has moved beyond Amo.crp.nrg's property
*--Amo.crp.nrg is planning on running groundwater tests to see if the pool poses a hazard to local residents
*--$15m will likely be spent in 1991 for onsite repairs and remediation of the petroleum pool

<>1991je:Yugoslavia, Belgrade | Visiting USA Secretary of State James Baker pledged US support for the "Greater Serbia" faction of Milosevic, resulting in eruption of war. Under President Bill Clinton, the USA soon joined as a member of NATO in an attack on Serbia [Ecrn]

<>1991au:Oil and Gas Investor:55-57|>Woulff, Kurt. "Winners for the '90s"
*1990s:Investment opportunities in nrg.gn will emerge bcs prices of nrg.gn have become depressed relative to other fuels
*--The best relative investment performance could accrue to buyers of undervalued nrg.gn
*--Natural nrg.g is becoming a growth fuel and growth industry
*--Promising companies include Amo.crp.nrg
*--Amoco, the largest holder of natural nrg.g rzv~ in North America, has 42% of its value in that commodity

<>1991au16:ERG| Chevron-SSR nrg.p deal under fire,KZX Tengiz [nrg.p]

<>1991oc14: Forbes:44-54|Fuhrman,Peter. "Caught Between the Republics"
*--After the 1991 failed coup [ID] Amo.crp.nrg won a tender from the RUS [SSR?] gvt to develop CSP.S offshore rzv~ of 2.0bB+
*--The resultant breakdown of the KPS has resulted in the gvt not treating Amo.crp.nrg as well as Chv.crp.nrg
*--Chv.crp.nrg also has a cns from the USSR in the CSP rgn
*--Amo.crp.nrg's problem is that its rzv~ are in the Republic of AZRjan
*--AZR wants to split profits with Amo.crp.nrg 50/50

<>1992je:RUS-KZX-Oman “Caspian Pipeline Consortium” [CAS.ptpt] fnd~, connect w/ NVR in BLK.S

<>1992de:Vyakhirev,Rem I.(934::) Ggzz.crp boss succeeded QdnV as QdnV bcm Mnr1
*--“Chain-smoking Vyakhirev, 63, appears on the surface to be a fairly typical Soviet-style bureaucrat. He boasts of receiving the Order of Lenin. […] He often lapses into the vague language of a bureaucrat when answering questions” [G/997se22: rtl]

<>1993:CHN bcm net mpter of nrg.p| CHN Active in AFR and CAS [Coll.Private:240-5]

<>1993:2005; ExxM.crp.nrg CEO = Raymond,Lee [His term summarized = Coll.Private:324-5]
*--Forsythe,Rosmarie = ExxM.crp.nrg RUS.spcist [Coll.Private:160-3,255,419,442,463 | re.RUS ch12,250-79,621-2]
*--Tillerson,Rex = ExxM.crp.nrg u&d mnger in RUS| 2006:bcm ExxM.crp.nrg CEO

<>1993ja19-1993fe10: Two reports about how the Japanese seek closer ties with Russia and its nrg rzv~ [TXT] and about the Japanese assessment of nrg rzv~ in Siberia [TXT]

 

<>1993ja-fe: This entry contains descriptions of two Japanese reports [#1 just below and #2 | nrg.g.rzv=] about oil and natural gas reserves in eastern Russia. The reports were prepared at the American Embassy in TKO [WWW SOURCE HAS EVAPORATED].

*1993ja19:First report from the American Consulate in Sapporo
It discusses tentative JPN-RUS commercial ties in the Hokkaido-Sakhalin area. ((JPN HKD SXL))

SUBJECT: IMI: HOKKAIDO GOVERNOR SEEKS EXPANDED TIES WITH SXL

1. SUMMARY: HOKKAIDO GOVERNOR YOKOMICHI SEEKS TO OPEN A REPRESENTATIVE OFFICE IN YUZHNO-SXLSK AS PART OF EXPANDED TIES WITH SXL STATE. BOTH THE MOFA AND THE PREFECTURAL ASSEMBLY HAVE EXPRESSED OPPOSITION. YOKOMICHI WILL VISIT THE DISPUTED NORTHERN TERRITORY ISLANDS THIS SUMMER. HE SEES THE ECONOMIC HEALTH OF DEPRESSED HOKKAIDO PORTS AS DEPENDING ON INCREASED RUSSIAN TIES. END SUMMARY.

HOKKAIDO REPRESENTATIVE OFFICE

2. DRAWING ON A CLOSE WORKING RELATIONSHIP WITH SXL STATE GOVERNOR FEDEROV, YOKOMICHI WISHES TO OPEN A HOKKAIDO OFFICE TO SURVEY LOCAL CONDITIONS AND FOSTER 'BILATERAL' CULTURAL AND BUSINESS TIES. BASED ON A CAMPAIGN PROMISE TWO YEARS AGO, YOKOMICHI PLANNED TO FUND DIRECTLY A HOKKAIDO REPRESENTATIVE OFFICE, DISPATCHING PREFECTURAL OFFICIALS TO STAFF IT. HOWEVER HE HAS MET OPPOSITION BY BOTH THE MOFA AND THE HOKKAIDO ASSEMBLY IN LATE DECEMBER THE ASSEMBLY LED BY THE LDP PASSED A RESOLUTION INDEFINITELY POSTPONING OPENING A SXL OFFICE. THE RESOLUTION CITED "UNSTABLE POLITICAL CONDITIONS" AND "WIDESPREAD ECONOMIC MISMANAGEMENT" IN RUSSIA, ASSERTING THAT "HOKKAIDO BUSINESS CIRCLES WERE SKEPTICAL ABOUT THE USE OF ECONOMIC TIES WITH SXL."

3. HOWEVER, YOKOMICHI IS PRESSING FOR A BUDGET FOR THE PROJECT IN THIS FISCAL YEAR'S BUDGET, BEGINNING IN MARCH. HE SEEKS 350,000 DOLLARS "TO STUDY" OPENING AN OFFICE, URGING THAT HOKKAIDO NEEDS AN OFFICE TO GATHER INFORMATION AND PROVIDE GUIDANCE PRECISELY BECAUSE SXL IS UNDERGOING RAPID CHANGES. IT IS EXPECTED THAT HE WILL USE PART OF THE PROPOSED BUDGET DISPATCH A PREFECTURAL TEAM ON A TEMPORARY BASIS THIS YEAR TO REPORT ON SXL DEVELOPMENTS.

MOFA OBJECTIONS

4. MOFA HAS ALSO OBJECTED TO AN HOKKAIDO OFFICE IN SXL, CONCERNED OVER THE LEGAL COMPLICATIONS RAISED BY SUCH AN OFFICIAL PRESENCE. ACCORDING TO PREFECTURAL SOURCES, THE MOFA INFORMED HOKKAIDO THAT LOCATING AN OFFICIAL REPRESENTATIVE OFFICE IN SXL WOULD BE UNACCEPTABLE BECAUSE POST-WAR QUESTIONS OF JAPANESE SOVEREIGNTY IN THE REGION HAVE BEEN LEFT UNSETTLED BY THE ABSENCE OF A POST-WWII JAPAN-RUSSIAN PEACE TREATY. AS THE MOFA CONTACT EXPLAINED IT TO HOKKAIDO OFFICIALS, OPENING SUCH AN OFFICE COULD BE A TACIT RECOGNITION OF RUSSIA'S OCCUPATION OF SOUTH SXL. (COMMENT: SOUTHERN SXL BELOW THE 50TH PARALLEL WAS JAPANESE TERRITORY DATING FROM THE 1905 PORTSMOUTH TREATY, ENDING THE RUSSO-JAPAN WAR. END COMMENT)

5. TO MEET MOFA CONCERNS, THE PREFECTURE PUT FORWARD PROPOSALS TO HAVE THE OFFICE REPRESENT A "NON-PROFIT FOUNDATION" RATHER THAN THE PREFECTURE. PLANNERS PROPOSED THE OFFICE BE NAMED "HOKKAIDO ECONOMIC INFORMATION LIAISON OFFICE," FUNDED BY PRIVATE SOURCES AND HOUSED IN RENTED QUARTERS. THE STAFF, HOWEVER, CONTINUE TO BE PREFECTURAL PROFESSIONALS. THIS PROPOSED OFFICE HAS ALSO MET A LUKEWARM RECEPTION. THE PREFECTURAL ASSEMBLY THIS PROPOSAL WAS PREMATURE, GIVEN RUSSIA'S ECONOMIC CONDITIONS. HOKKAIDO'S NORTHERN TERRITORIES' ASSOCIATION ALSO CRITICIZED IT AS OBSCURING THE SOVEREIGNTY QUESTION.

INVESTMENT IN "NORTHERN TERRITORIES"?

6. MOFA RAISES SIMILAR CONCERNS OVER THE SOVEREIGNTY ISSUE, THE QUESTION OF EVEN INVESTMENT BY JAPANESE FIRMS IN THE NORTHERN TERRITORIES, THE DISPUTED ISLANDS OFF HOKKAIDO'S EASTERN COAST NEAR NEMURO. HOWEVER, GOVERNOR YOKOMICHI ANNOUNCED IN NEW YEAR'S INTERVIEWS IN LOCAL MEDIA THAT A LEGAL MEANS CAN BE FOUND FOR OPENING JAPANESE INVESTMENT ON THESE DISPUTED ISLANDS. TO EXPAND ECONOMIC TIES, HE SAID HE WISHES TO OPEN A DIRECT DIALOGUE WITH THE RUSSIANS ON THE ISLANDS. HE ANNOUNCED THAT HE WILL VISIT THE ISLANDS IN JULY 1993 AS PART OF THE 'VISA FREE' EXCHANGES. HE PROPOSED THAT HOKKAIDO AND OTHER JAPANESE FIRMS INVEST IN FISH PROCESSING PLANTS ON KUNASHIRO OR ETORUFU, THE LARGEST ISLANDS. YOKOMICHI SAID THAT THE 1992 "VISA FREE" EXCHANGES WITH RUSSIANS ON THE ISLANDS HAD LAID THE BASIS FOR GROWING DEMANDS IN HOKKAIDO FOR ECONOMIC TIES WITH THE ISLANDS.

7. YOKOMICHI SAID THAT SUCH INVESTMENT ON THE ISLANDS WOULD CONTRAVENE THE GOVERNMENT OF JAPAN (GOJ) STANCE ON JAPANESE SOVEREIGNTY OVER THE ISLANDS. IN EFFECT, HE PROPOSED WORKING OUT WITH SXL AUTHORITIES AN ARRANGEMENT FOR THE ISLANDS BECOMING A SINGLE LARGE 'FREE PORT' ZONE FOR JAPAN. THE PLANT'S PRODUCT WOULD ENTER JAPAN AS 'MADE IN JAPAN' WITHOUT CUSTOMS DUTIES. IN ADDITION, THE PLANT'S RUSSIAN EMPLOYEES WOULD BE PAID IN YEN. THE CONTRACT WITH THE SXL AUTHORITIES FOR LOCATING THE WOULD ARRANGE TO AVOID THE NEED FOR LICENSES, LAND TAXES OR ARRANGEMENTS THAT MIGHT IMPLICITLY RECOGNIZE RUSSIAN SOVEREIGNTY. (COMMENT: IN EFFECT, YOKOMICHI APPARENTLY SEEKS TO TURN TO HOKKAIDO'S ADVANTAGE A 12/8 DECLARATION BY RUSSIAN PRESIDENT YELTSIN MAKING THE "SOUTHERN KURILES" A FREE ECONOMIC ZONE IN WHICH OVERSEAS FIRMS WOULD OBTAIN TAX EXEMPTIONS, FOREIGN CURRENCY USE, 99 YEAR LEASES AND OTHER PRIVILEGES. SXL GOVERNOR FEDEROV PROMOTED THIS SPECIAL STATUS FOR THE ISLANDS TO REVIVE THEIR ECONOMIES. END COMMENT.)

"VISA FREE" VISITS TO NORTHERN TERRITORIES

8. YOKOMICHI DEMONSTRATED HIS PERSONAL INVOLVEMENT IN THE ISSUE BY ANNOUNCING AT NEW YEARS THAT HE WILL VISIT THE NORTHERN TERRITORIES ISLANDS AS PART OF A "VISA FREE" EXCHANGE GROUP SUMMER. HE SAID HE HAS THE MOFA APPROVAL FOR SUCH PARTICIPATION. HE ANNOUNCED THAT HOKKAIDO WILL NOT RESERVE ITS OFFICIAL ROLE TO THE EXCHANGES ONLY TO PREPARING FACILITIES FOR RUSSIAN VISIT. (COMMENT: THIS IS A POLICY DEVELOPMENT SINCE MOFA HAS SOUGHT TO RESTRICT PARTICIPATION IN THE VISIT GROUPS TO MEMBERSHIP BY FORMER RESIDENTS. IT HAS RESISTED HOKKAIDO'S EFFORTS TO INCLUDE SPORTS AND BUSINESS GROUPS TO BROADEN THE EXCHANGES. END COMMENT.) YOKOMICHI INDICATED THAT THE SUCCESS OF THE EXCHANGES IN 1992 FED A DEMAND IN HOKKAIDO COMMUNITIES FOR MORE NUMEROUS, BROADER PARTICIPATION. CURRENT MOFA POLICY IS THAT THE VISITS' PARTICPANTS WILL REMAIN AT THE SAME NUMBER AS LAST YEAR'S.

9. COMMENT: YOKOMICHI'S PROPOSALS FOR A SXL OFFICE AND NORTHERN TERRITORIES ECONOMIC COOPERATION LACK PRECISION. IN FACT, IT IS UNCLEAR THAT JAPANESE INVESTORS COULD SO NEATLY NAVIGATE THE STICKY NORTHERN TERRITORIES SOVEREIGNTY QUESTIONS THAT CONCERN MOFA AS HE SEEMS TO SUGGEST. HOWEVER, YOKOMICHI SEES THESE RUSSIAN TIES AS THE KEY TO REVIVING DEPRESSED FISHING ECONOMIES IN CITIES SUCH AS OTARU, NEMURO AND WAKKANAI. YOKOMICHI LIKES TO CITE HOW PROSPECTS APPEAR QUITE DIFFERENT IN WAKKANAI FROM THOSE IN TKO BECAUSE HOKKAIDANS THERE LIVE ABOUT 50 KM AWAY FROM SXL ACROSS THE LA PEROUSE STRAIT. THESE RESIDENTS AT HOKKAIDO'S NORTHERN TIP SEE EVIDENCE IN THEIR POCKETBOOKS OF THE ADVANTAGES OF EXPANDING RUSSIAN TRADE AS THE NUMBER OF RUSSIAN SHIPS AND FISHING BOATS VISITING WAKKANAI HAS INCREASED DRAMATICALLY (FROM 376 IN 1991 TO OVER 800 LAST YEAR). IN THE SUMMER, THERE IS EVEN AN UNOFFICIAL FERRY SERVICE FOR THOSE DOING BUSINESS ACROSS THE STRAITS IN YUZHNO-SXLS. GOVERNOR YOKOMICHI CAN BE EXPECTED TO CONTINUE LAUNCHING TRIAL BALLOONS IN THE PRESS ON WAYS TO SHAKE LOOSE FROM THE DEADLOCKED JAPAN-RUSSIAN VIEWS ON THE NORTHERN TERRITORIES. AS A LOCAL LEADER INDICATED, GOVERNOR YOKOMICHI DISAGREES WITH THE GOJ LINKAGE OF ECONOMIC AID TO PRIOR RUSSIAN RESOLUTION OF THE SOVEREIGNTY QUESTION. HE REPORTEDLY SEEKS A STEP-BY-STEP APPROACH OF TRADE AND AID TO MOVE RUSSIAN PUBLIC OPINION TO EVENTUALLY ACCEPTING THE GOJ POSITION.

 

*1993fe10:Second report =

AMEMBASSY TOKYO {JPN TKO}

SUBJECT: JAPANESE ESTIMATES OF ENERGY RESOURCES IN EAST SIBERIA AND RUSSIAN FAR EAST ((SBR))

1. AN INTERIM REPORT PREPARED BY THE SAPPORO BASED NORTHERN REGIONS CENTER (NRC), A MOFA SUPPORTED RESEARCH CENTER, ESTIMATES THAT ENERGY RESOURCES IN EAST SBRIA AND THE RUSSIAN FAR EAST TOTAL 17.8 bT.nrg.p AND 56.0tcM.nrg.g. [p.rzv=] PROVEN RESERVES TOTAL 640 mT.nrg.p AND 2.50tcM.nrg.g, 3.6% AND 4.5% RESPECTIVELY OF TOTAL ESTIMATED RESERVES. THE NRC ESTIMATES ARE BASED ON DATA PROVIDED BY THE GEOLOGICAL COMMITTEE OF THE RUSSIAN FEDERATION.

2. 51% OF PROVEN OIL RESERVES ARE LOCATED IN THE RUSSIAN FAR EAST AND 49% IN EAST SBR. ESTIMATED OIL RESERVES ARE DIVIDED EQUALLY BETWEEN THE TWO REGIONS. 63% OF PROVEN GAS RESERVES ARE LOCATED IN THE RUSSIAN FAR EAST, BUT ONLY 43% OF ESTIMATED GAS RESERVES. THE BALANCE IS LOCATED IN EASTERN SBR. PETROLEUM BEARING REGIONS IN EAST SBR INCLUDE KRASNOYARSK AND IRKUTSK WHILE THOSE IN THE RUSSIAN FAR EAST INCLUDE AMUR, KMQ, XBR, MAGADAN, PRIMORYE, SAKHA AND SXLIN.

3. THE REPORT'S FINDINGS WERE RELEASED BY MOFA DIRECTOR-GENERAL KAZUO OGURA ON FEBRUARY 2 IN AN ADDRESS TO THE SEVENTH SYMPOSIUM ON PACIFIC ENERGY COOPERATION (SPEC 7) WHICH DEVOTED ONE OF ITS FOUR HALF DAY SESSIONS TO PROSPECTS FOR ENERGY COOPERATION IN RUSSIA. OGURA AND OTHER SPEC 7 SPEAKERS NOTED THAT THE DEVELOPMENT OF RUSSIA'S ENERGY SECTOR OFFERED SIGNIFICANT OPPORTUNITIES FOR INTERNATIONAL COOPERATION. BEST PROSPECTS FOR SHORT TERM ENERGY COOPERATION IN RUSSIA WERE IN PROJECTS TO REVITALIZE EXISTING nrg.g & nrg.p.ggr. IMPLEMENTATION OF LARGE GREENFIELD ENERGY PROJECTS IS UNLIKELY UNTIL RUSSIA ESTABLISHES THE NECESSARY TAX AND LEGAL SYSTEM TO FACILITATE THE LARGE INVESTMENTS NEEDED FOR INFRASTRUCTURE AND TRAINING. SPEAKERS ALSO STRESSED THAT RUSSIA'S ABILITY TO SERVE AS A RELIABLE SOURCE OF nrg xpt~ WOULD ALSO DEPEND HEAVILY ON ITS ABILITY TO REDUCE CURRENT ENERGY WASTE.

4. MOFA SOURCES EXPRESSED HOPE THAT THE NRC STUDY WOULD LEAD TO FOLLOW-UP FEASIBILITY STUDIES FOR SPECIFIC PROJECTS. A MORE DETAILED STUDY OF RUSSIA'S ENERGY RESOURCES IS BEING CONDUCTED BY JAPAN'S INSTITUTE OF ENERGY ECONOMICS AND IS INTENDED TO PRODUCE MORE SPECIFIC INFORMATION ON BOTH PETROLEUM AND NRG.C RESOURCES THROUGHOUT RUSSIA. INTERIM RESULTS OF THE IEE STUDY WILL BE READY IN APRIL 1993 WITH A FINAL REPORT EXPECTED IN MARCH 1995. RESULTS OF THE STUDY WILL BE AVAILABLE ONLY TO IEE MEMBER ORGANIZATIONS WHO PROVIDED FINANCING FOR THE PROJECT. [?GO 93ap & 95mr

5. (4 in original). COPIES OF THE NRC REPORT AS WELL AS OTHER PAPERS REGARDING PETROLEUM DEVELOPMENTS IN RUSSIA PRESENTED AT THE SYMPOSIUM ARE BEING POUCHED TO EB/ERF/OGE AS WELL AS AMERICAN EMBASSY MOSCOW.)

 

<>1993ap:KZX| [Chv.crp.nrg] Chevron concluded a historic $20b, 50/50 joint venture deal with KZXan (Tengizchevroil [TGZ.nrg]) to develop the TGZ nrg.p.ggr, in the N CSP.S Basin. Discovered in 1979, Tengiz is estimated to contain

3-10bB.nrg.p, although it currently produces only about

0.1mB/d.nrg.p (up from 0.055mB/d.nrg.p in 1995)

Production has been constrained by lack of an xpt outlet [tpt], as well as by RUS complaints abt >mercaptans (corrosive, foul-smelling compounds of carbon, hydrogen, & sulfur) in the oil

[ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

-----

<>1993my20:AZR BAKU| State concern "Azerinft" signed Memorandum of understanding w/"AMOCO Caspian Sea Petroleum","Bi-Pi Exploration Operating","Pennzoil Caspian","Unocal Khazar Ltd.","McDermott" & Turkish oil corporation on mutual extraction frm fields "Azeri","Chirag"& "Gyuneshli"| "Azerineft" prx=Sabit Bagirov| AMOCO & PENNZOIL will sign trt on development of Chirag field| Specialists estimate total reserves of the 3 AZR fields to be 645M ton (Azeri field=310M,Geneshli=180M & Chirag=150M)| Exploitation for 10 years,earning for AZR $100B| In addition to ekn profit,Baku expects zpd plt support| Expect ENG bnk~ & zst firms to open branch ofc| Also mfg skz equipment & construction of AZR off-shore nrg.p platforms,& reconstruction of entire AZR mxx & communications systems| In Garayev's view,the expansion of the cooperation with GRB will have great plt meaning for AZR [93my29:AzN 5/19 (Turan news agency)]| ((G-7))

 

<>1993je08:MVA| jrn.cnf| Vainberg,Lev(prx of Association of Joint Ventures,International Associations,and Organizations) accused stt ptpt mpy of discrimination against prv-fxx- nrg.p crp~:je01:Transnft stt ptpt crp halted shipments of private oil but continued to move stt-produced oil

<>1993se10:FoA:81-93|Stanislaw,Joseph and YrgD| “Oil: Reopening the Door” [to Russia]

After the fall of Communism, Russian oil production fell precipitously, from

12.5mB/d (1988) to

07.0mB/d (1993)

This drop is due to Soviet "over investment in terms of return, poor oil field practices, and outdated technology." Unfortunately for Russia, oil is one of the few things it can sell for hard currency, of which it is in desperate need. It has been estimated that Russia needs to spend

$50b between now and 2000 in order to stabilize oil production at present levels. In order to return to

12.5mB/d, Russia will have to invest another

$50-70b

Clearly, this money will have to come from joint ventures with foreign, probably Western, companies. Russia, however, will have to compete with the former Soviet Republics, Africa, Latin America, and Southeast Asia for oil investments

<>1993de:Mob.crp.nrg BP.crp.nrg Shell.crp.nrg etc help xplor C.ASA nrg.p for KZX

<>1993de:KZXan and a consortium of Western [sic! zpd] oil companies (including Mobil, British Gas, Agip, Total, BP.crp.nrg, Statoil and Shell.crp.nrg) had signed an agreement to explore and develop potentially massive oil and nrg.g.rzv~ underneath the CSP.S [http://www.eia.doe.gov/emeu/cabs/kazak.html]

 

--------------------

*1994fe27:MGW:15 translated Le Monde| Michele Maringues reports on NGR developments from Port Harcourt =
The Ogoni people are stepping up their campaign for a larger share of their country's revenues.

ONLY EIGHT months ago [summer of 1993] the market place in Kaa, some 60 kilometres south of Port Harcourt, was a bustling [sic] with traders. Today all that remains is a desolate ruin where a piece of torn galavanised sheeting occasionally hums in the wind — a terrible testimony to the tensions undermining a region vital for Nigeria's oil production.

For more than a year, the Nigerian army has been on a state of full alert in the 650 square kilometres of Ogoni country where the Ogoni population barely amounts to 500,000. Nigeria's oil is carried through this luxuriant country in pipelines to the Bonny terminal.

There are road checkpoints, and soldiers both to protect the oil technicians and prevent another outbreak of ethnic violence between the Ogonis and the neighbouring Andonis.

I.ast July, following incidents at the height of the presidential election campaign, the Andonis massacred Ogoni fishermen returning from Cameroon, then launched an all-out attack on Kaa, blowing up places of worship, homes and schools. The fighting continued until September, leaving 438 Ogonis and 123 Andonis dead.

The two communities had been living in peace for the last 40 years. Who provided the Andonis with the explosives and the automatic weapons used so devastatingly in the Kaa attack?

[…]

"It's Shell's filthy war," say the Ogonis, accusing, without any proof, the powerful Anglo-Dutch company of fomenting inter-ethnic strife with the help of the former Rivers State governor, Rufus Ada-George, an Okrika.

[More on Shell in Nigeria = http://en.wikipedia.org/wiki/Shell_Nigeria | http://www.huffingtonpost.com/tag/shell-oil-nigeria ]

In fact, the Ogonis are upsetting many people. For the last two years, this humble and obscure community, one of the most backward living in the Niger delta, has been spearheading a campaign in favour of environmental rights in the Third World and the defence of oppressed minorities. Behind them there are not only the other ethnic minorities of the southeast who form the bulk of Nigeria's population, but also all those who challenge the supremacy of the three dominant groups — the Hausa-Fulani in the north, the Yoruba in the west and the Ibo in the south — and demand a fairer share of the country's wealth.

Many Nigerians cannot accept the fact that the government is spending billions on constructing the federal capital Abuja, with its expressways, conference centres and a presidential palace, while their villages still lack proper roads, schools, running water and electricity.

“The Nigerians don’t work, they don’t collect taxes, all they do is sit around waiting for the oil money to see how much of it the ‘Thief of Abuja’ (the Nigerian head of state) is going to leave them," quipped Ken Saro-Wiwa, 52. founder of the Movement for the Survival of the Ogoni People (Mosop)

[Nigerian Oil]

Before the Biafra succession in 1967, when the Ibos took the initiative, over 90 per cent of the oil produced in the southeast of the country came from non-Ibo territories, he pointed out. In 1970, the oil-producing Nigerian states were still receiving 45 per cent of the oil revenues.

Then, under General Ibrahim Babangida's regime (1985-93) their share fell to 1.5 per cent, then doubled last year when public protests became too great. "They leave us 3 per cent of the oil and 100 per cent of the pollution," said Saro-Wiwa.

In the autumn of 1992, Mosop gave the oil firms an "ultimatum". It demanded £18 billion in owed dues from Shell and Chevron and their Nigerian partner, the Nigerian National Petroleum Company (NNPC), plus £4 billion compensation for the environmental damage inflicted over the last 30 years. On January 4, 1993, when all public protests were banned, between 150,000 and 200,000 took part in a peaceful march through Ogoni country.

[More on Chevron in Nigeria [W#1 | W#2]

A few weeks later, with an army clamp-down on the region, Mosop again succeeded in organising a "civic vigil" with the traditional religious chiefs. After several bloody incidents, Shell was forced to close down all its Ogoni oil wells. In May, the federal government issued a decree laying down the death penalty for anyone who threatened Nigeria's unity.

WHEN the military regained power last November [1993], it forced Governor Ada-George to resign and this opened new prospects. Sweeping aside the hesitations of the "northerners", the new head of state, General Sani Abacha, promised to hold a constitutional conference in March for re-establishing Nigeria on more equitable bases.

In January. General Abacha sent Donald Etiebe and Alex Ibru, his oil and home ministers respectively (both members of delta minorities), to Rivers State as a sign of good will and similar visits are planned to the other oil-producing states.

Everybody now feels that it is time to get around the table, starting with the constitutional conference promised for March.

Follow up = Wki#1 | Wki#2 | F/March 2008/
Wki#3 | F/fuel subsidy/ and F/privatisation/

-------------

<>1994ap:JPN consortium (Mitsui, Mitsubishi {Mcb}, and Toyo Engineering [bdg]) agreed to construct a $1.50b, 0.06mB/d nrg.p.zvdy on E CSP.S shore [SOURCE]

<>1994su:Russia and TRKey

<>1994su:fa;Russia and IRN

<>1994jy27:CDP:23|Charodeyev,Gennady. "Turkey"

<>1994au17:CDP:24-5|Eggert,Konstantin. "Middle East"

 

<>1994au24:WSJ:1|Newman,Barry. "Dire Strait: Oil, Water and Politics Make a Volatile Mix in Crowded Bosporus"

TRKey has recently enacted new regulations making it more difficult for oil tankers to pass [tpt] through the Bosporus, the strait between the Black Sea and the Mediterranean. Russia is very displeased about this development, as it narrows a route for nrg.p xpt~. TRK claims that increased traffic in the straits will cause environmental damage, and it is necessary to act now. If things continue on the same course, says Turkey, there will inevitably be a huge spill in the straits. However, this conflict has not prevented Turkey from accepting a large shipment of Russian weapons to settle an old debt between TRKey and the former USSR, whose debts Russia inherited. Finally, a rivalry is brewing between Russia and Turkey over the route of a ptpt from AZRjan.

 

<>1994se07:CDP:18|Abarinov,Vladimir. "Middle East"

<>1994se28:WSJ:20|Greenberger,Robert S. "Clinton Gains on IRN Sales with Yeltsin"

<>1994oc10:Insight on the News:10|Kramer,David J. "IRN, TRK and RUS vie over Central Asian Energy"

<>1994no09:CDP:26|Mekhtiyev,Aidyn. "Chernomyrdin has no complaints against 'Contract of the Century'"

<>1994au:Scientific American:26-31|Revelle,DJ and Lumpe,Lora. "Third World Submarines"

<>1994oc26:CDP:3-4|Yusin,Maksim. "The Last Submarine Will Cast Off for IRN"

IRN is a major market for Russian weapons makers, and Russia has been selling large amounts of conventional weapons to IRN despite strong USA objections. Russia is unlikely to stop shipping weapons, considering that they are a major source of hard currency (IRN already owes Russia over $300m for arms deliveries). President Yeltsin has promised to halt arms deliveries, but they still continue. Russia is a major supplier of IRNian diesel submarines, which are considered a grave threat to established navies and regional security (and, of course, they can prey on oil tankers in the event of war). RUS has also signed a treaty with IRN, along with AZRan, TKMia, and KZXan which promises to increase regional cooperation in oil production in the CSP.S. Finally, IRN wants to have influence over nrg.p xpt~ from the former Soviet Republics in Central Asia, against Russia's strong resistance.

<>1994se:AZR CSP.S|In what was described as "the deal of the century", an international consortium - the Azerbijan International Operating Company (AIOC) - signed an $8.0b, 30y contract to develop 3 nrg.p.ggr =

AZR
Chirag
Guneshli (deepwater portions)

Total rzv~ estimated at
3.0-5.0bB

Current AIOC mmb~ [?codes correct?]=

BP.crp.nrg

ENG

17.1%

Amo.crp.nrg

 

17.0%

State Oil Company of AZR (SOCAR)

AZR

10.0%

Luk.crp.nrg

RUS

10.0%

Uno.crp.nrg

USA

10.0%

Statoil

NOR

8.6%

Exx.crp.nrg

USA

8.0%

TPAO

TRK

6.8%

Pennzoil

USA

4.8%

Itochu

JPN

4.0%

Ramco

UKi

2.1%

Delta

SaA

1.6%

<>1994se28:UPI|Russia and CSP.S Oil Deals I|>Balman,Sid , Jr. "Clinton Presses Yeltsin on Oil Deals”

Recent events have blocked progress in the $7b development of nrg.p.ggr underneath the CSP.S
, which is believed to be very nrg.p-rich. The Russians claim that their recently-acquired 10% share in the consortium developing the CSP.S is not enough for them to allow development; Moscow is claiming a territorial right to the oil underneath the CSP.S, and says that it supports development only if all partners recognize her claim to the CSP.S nrg.p.ggr|The consortium's other mmb~:

Uno.crp.nrg,
Pennzoil,
Amo.crp.nrg,
BP.crp.nrg, and the national
AZRjani firm

[why not list others?]

President Clinton asked President Yeltsin to expedite the deal. Clinton has also asked Russia to expedite her negotiations with

Chv.crp.nrg,

KZXan, and

Oman about the construction of a ptpt from TGZ.nrg.p.ggr to RUS port NVR. Chv.crp.nrg, which is paying for most of the costs of building the ptpt, claims that it is getting a disproportionately smaller share than it deserves. Russia, however, is reluctant to renegotiate the current deal out of fear that her revenues will be reduced under any new arrangement.

<>1994fa:Russia and KWT

-Crosette, Barbara. "Russia and IRQ work out plan to work out Gulf Tension," 94oc14:NYT:16.
-Grudinina, Irina. "IRQ," 94oc12:CDP:28.
-Kondrashov, Stanislav. "What Russia Wanted to Prove in the IRQ Affair," 94no16:CDP:12.
-Sheridan, Michael. "Yeltsin Sends envoys to Gulf," 994oc12:Independent
- Yusin, Maksim. "Moscow demands pullback of IRQi Troops from Border with KWT," 94no09:CDP:10.

Russia claims that despite its apparently conciliatory policy towards IRQ, "her efforts to help IRQ will help KWT." The Russians recently announced that she had reached an agreement with IRQ that would lead to IRQi recognition of KWT and her borders. Russia has accused the West of not appreciating her efforts on behalf of KWT, and there seems to be some truth in Russia's assertion. Among the Arab countries, however, Russian actions on behalf of KWT have been met with enthusiasm, and Russian prestige in the area has risen. Russian policy towards KWT seems to mimic that of the USA; when President Clinton condemned IRQ for recent troop movements near the KWTi border, President Yeltsin lost no time in issuing his own condemnation. Russia's recent work to ease tensions between IRQ and KWT has also provided President Yeltsin with "a voice on the Middle-Eastern Stage."

<>1994fa:Russia and IRQ
-Abarinov,Vladimir. "Kozyrev and Hussein exchange Promises," 94no09:CDP:11-12.
-Anonymous. "Sanctions: Haiti? IRQ?," 94se22:WSJ:10.
-Eggert,Konstantin. "Middle East," 94se07:CDP:10.
-Erlanger,Steven. "Russians Make Their Voice Heard," 94oc18:NYT:16.
-Guseinov,Elmar. "Middle East," 94se10:CDP:24.
-Guseinov,Elmar. "IRQi Minister Arrives to Discuss Projects," 94no09:CDP:10-11.
-Schedrov,Oleg. "Yeltsin Launches Fresh Gulf Peace Initiative," 94oc11:Reuters World Service

IRQ owes Russia $7 billion, but cannot pay because of international sanctions. Russia, along with France, has been trying to lift UN sanctions against IRQ, very much to the ire of the United States. Although American officials are not pleased, they understand that President Yeltsin reaps needed political benefits from such displays of diplomatic independence. Russia has also been pressuring IRQ to recognize KWT's present borders. Talks have been underway for closer Russian-IRQi cooperation in oil production and Russian firms' involvement in the IRQi oil industry after sanctions are lifted. Russia has also recently signed a $10 billion "trade, industry, and oil projects protocol" with IRQ. These moves are seen by American officials as an attempt by Saddam Hussein to split Russia and the West in regards to their IRQ policies, although Russia has recently become worried that it is appearing to be IRQ's ally. Russian efforts have been complicated by a statement from a high official in the Foreign Ministry to the effect that "Saddam Hussein should be respected as a political leader," and that relations with IRQ should be improved.

<>1994oc24:Russia and Caspian Oil Deals II
-Anonymous. "Russia Seeks New CSP.S Deal," 94oc04:Lloyd's List/Reuter Textline

To relieve the stalemate in CSP.Sea oil development, Moscow has proposed that a new treaty be worked out between
RUS
AZR
KZXan
TKMan, and
IRN

KZXan has agreed to work out a common position with Russia, and submit it to the other three littoral states. This treaty would create a legal basis for the development of the Caspian, and possibly create a multi-national body to oversee Caspian oil projects. Russia also wants to address environmental concerns. Observers are saying that this proposal could be a reminder to Russia's neighbors that her concerns and interests in the area are not to be ignored. Also, a rivalry is brewing between TRKey and Russia over the route of a ptpt from AZRjan

 

<>1994no20:Russia and SaA|>Millership,Peter| "Saudi Arabia and Russia Aim to Promote Trade Ties"| Reuter Business Report

After establishing full diplomatic relations after the Gulf War, Russia and SaA are becoming on better terms with each other. The two countries recently signed a trade pact which opens the door to increased Saudi-Russian trade, which is now composed primarily of Russian xpt~ of timber and cars to SaA. The Russians sought to reassure the Saudis that Moscow's relations with IRQ would not be developed at the expense of the Gulf states. A high-level Russian delegation recently visited Riyadh to look for "deals in space technology, heavy industry, trade, and investments." The Saudis praised Russia's "new pragmatic approach in the Middle East," and a Riyadh newspaper noted that "In recent years, Moscow has drawn closer to the Moslem world." Moscow's relations with SaA are indicative of a Russia which is becoming more involved in Middle Eastern affairs.

 

<>1994no-de:RUS & nrg.p xpt~|>Specter,Michael| "In the Defiled Russian Arctic, Hope is a USA Oil Company"| 94no27:NYT:1
|>Sullivan,Allanna. "Tex.crp.nrg-led Consortium nears Russian Oil Agreement," 94no30:WSJ:4
|>Anonymous. "Russia to Lift Oil Restrictions," 94de06:WSJ:24
|>Anonymous. "Russia Demands Pipeline Help," 94de12:WSJ:11|1{}2{}3{ptpt}

To stimulate the petroleum sector of its economy, Russia has abolished its quota system for oil xpt~, eliminated the xpt tax on oil, and greatly eased necessary licensing procedures. Russia has also insisted that Western [zpd] oil companies help expand the Russian ptpt network as the price of developing her huge resources. Tex.crp.nrg has recently signed an agreement to develop 11 nrg.p.ggr in the northern Russian region of Timan-Pechora, which should go on-line in four years. Amo.crp.nrg has also signed on to develop the world's [wrl] largest untapped natural nrg.g field, near Novy Port, and plans to build a $15 billion ptpt from the Russian arctic to Europe. Health and ecological concerns have arisen, but they have not been addressed by the Russian government.

<>1994de10:Russian Oil Decrees|>Anonymous. "A Gusher Under Ice", 94de10:Economist:64-5. In addition to an in-depth profile of Luk.crp.nrg, the largest Russian oil company, [prv] this article details two of President Yeltsin's decrees which meant to stimulate the oil sector of the economy.

First, President Yeltsin decreed that the government must sell off state-owned oil companies to private Russian companies in order to create about ten major Russian integrated oil companies (Luk.crp.nrg will likely be the largest). This will probably make the Russian oil industry more competative and efficient

Second, YlcB decreed the abolition of oil xpt quotas, which created an artificial xpt cap. The amount of Russian oil xpt~ will become determined by the capacity of ptpt~. As a result of this decree, Russian oil xpt~ should increase, domestic oil prices should rise sharply, and the income of the oil companies should rise as well (Luk.crp.nrg expects its real cash flow to double in 1995).

 

<>1995wi:KZX| Chv.crp.nrg announced cutbacks in its $20b TGZ joint venture due to frustration with the lack of progress in this area. Given adequate xpt outlets, Chevron [Chv.crp.nrg] believes Tengiz [TGZ] can reach peak production of

0.750mB/d by 2010

Another estimate, by consulting firm Wood Mackenzie, is that Kazak [sic!]oil and condensate production could reach

1.40mB/d by 2010, but only with investment of huge amounts ($35.0b) [SOURCE]

 

<>1995:Russia debated the massive "privatization" of old Soviet economic enterprises, many of national, even international, significance, most particularly the huge petroleum and natural gas industries [TXT]

<>1995ja:KZXan & RUS signed a series of accords which had been promoted by Presidents Yeltsin [&] Nazarbayev as the foundations of a new "Eurasian Union". Prominent among the accords was an agreement to establish customs-free trd between the two countries for an unspecified period, as well as joint development of Knrg.g.ggr

<>1995mr: CF:1993ja:je

<>1995mr:KZX prx Nazarbayev granted most favored status to Knrg.g.ggr prj which involved projected $10b over 40years|The giant Knrg.g.ggr, located in the northwestern part of the country, alone contains about 46.0tcF of natural gas. In 1992, British Gas and Agip of ITL won a tender allowing them exclusive rights to arrange the development of Knrg.g.ggr, an extension of Russia's Orenburg field. British Gas and Agip also have an agreement with Russia's Ggzz.crp for development of the field and utilization of Russia's cross-border Orenburg nrg.g nrg.p.zvd [ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

<>1995sp:Organization for Economic Cooperation and Development [OECD mmb = AUStralia OST BEL CAN DEN FIN FRN GRM GRK ICE IRE ITL JPN LUX MXO NED NZE NOR POR SPN SWD SWZ TRK UKI USA] pbd Transition Economies with bbl of books on nrg xtx in “non-OECD” countries:

--Energy statistics and balances of non-OECD countries/International Energy Agency = Statistiques et bilans energetiques des pays non-membres/Agence internationale de l'energie|PRS: OECD/IEA, 1991- |1{HD9502.A2 W67 1988/89| 8x11:Energy}2{}3{}

 

<>1995ap27:http://www.greenpeace.org/home/gopher/campaigns/air/1995/russoil.txt

TL: Ukhta nrg.g ptpt Explosion in Russia
SO: Greenpeace International
DT: April 27th 1995
by Ivan Blokov and Greenpeace Sweden

Explosion on the nrg.g ptpt-line near Ukhta resulted in no less than 3000 tonnes of nrg.g burnt.

Draft information on the fire incident on the nrg.g ptpt-line near Ukhta, Komi Republic.

On the night of April 27, on the main nrg.g line near the town of Ukhta, a fire incident was registered in the vicinity of a compressor unit, at a distance of about 15-17 km from the town of Ukhta and at some 800 metres from a village. The hole after the explosion was 5 meters deep.

The first information about this accident was reported by a JAL pilot who witnessed it at 01:30am, MVA time. The fire was so significant that he thought it was a nuclear explosion. As usual, official reports were conflicting. According to Ggzz.crp (Gas Industry Association), the fire began at 02:20am and was over by 05:00

According to a representative of the Ministry of Emergency Situations, the fire was over by 4 a.m. He stated the situation was under control. The Ministry of Environment had no information whatsoever.

According to the chief engineer from the "Severgasprom" MA Ivan Gubanok [Ggzz.crp?], this should be considered as a common accident. The similar ones occur almost every week. According to him, the nrg.g ptpt passes through sparse forests where, as a result of the accident, some 30-40 trees were burnt. He also said that all nrg.g that was between compressor units, had burnt out.

According to the Ukhta Civil Defence headquarters, the trees within the accident zone were not affected.

Deputy Minister of Environment Victor Kostin responsible for the control of such situations is away on his business trip. The chief of the state ecological inspectorate Rustem Mamin is not in his office since yesterday. The chief of the nature protection department of the Komi republic is on holidays now, his colleagues failed to report any information at 1 p.m.

The nrg.g ptpt-line belongs to Severgasprom [Ggzz.crp?].

Technical characteristics:

diameter -- 1420 mm
design pressure -- 75 atm
pressure at a force compressor unit -- 70 atm
pressure nearing the next compressor unit -- 50 atm
gas density at a force compressor unit -- about 62 kg/cub m gas
density at the next compressor unit -- 42 kg/cub m
distance between compressor units is about 40 km
total amount of nrg.g within the ptpt-line locked between the two compressor units is about 3,200 tonnes.

No less than 3200 tonnes of nrg.g were discharged in the environment.

This incident is another example of catastrophic situation in the nrg.g and oil network in Russian. In general, most oil and nrg.g ptpt-lines in Russia are operated longer than can be permitted.

Over 10% of ptpt-lines are operated more than 35 years
32%, more than 20 years
30%, 15-20 years.

It is not surprising that uneven increase of accident rate is observed in Russia. For instance, in the Komineft network alone, the number of accidents increased from 51 in 1986 to 2470 in 1994.

Greenpeace considers this accident cannot pass without leaving a harmful trail in the environment. Acid precipitations, smoke and soot are yet to come. A considerable amount of carbon dioxide - major greenhouse nrg.g - will be released in the environment.

The nature of this region is quite fragile. This is a section of northern taiga that is rather close to tundra. Environmental impacts in this region are already significant. An annual 780 kg of hazardous substances (including oil and gas) per citizen are released in the environment, which is comparable with similar releases in major industrial cities, such as Moscow and Ekaterinburg. Even a small addition of pollutants may cause destruction of forests and fragile Arctic biological systems.

More detailed information about ecological effects of this accident will be known tonight after the site investigation by Greenpeace team.

According to the video sent from Uchta, at least 10 hectares were destroyed.

About Helium:

Helium is extracted from natural nrg.g deposits. Only a few sources in the world [wrl] contain a significant proportion of helium and justify its separation. These are in the US, Poland, Algeria and Russia. Because of its high value, helium is the only major industrial nrg.g to be traded internationally.

Only hydrogen nrg.g is lighter than helium but unlike hydrogen, which is highly inflammable, helium is inert. It is therefore a natural and safe choice for filling balloons of all shapes and sizes. Being so cold when liquefied (-272.2o C or -457.96o F), it provides the means to achieve the very low temperatures needed for the superconducting magnets in hospital MRI scanners and specialised research equipment.

Key Properties =
Completely inert, lighter than air, highly mobile and small molecular size, low solubility, coldest of all in the liquid phase.
Applications
Shielding nrg.g for welding
Balloon nrg.g
Leak detection
Extreme cooling for super conducting magnets (MRI)
Diving nrg.g mixtures
Breathing mixtures for people with impaired lung functions, eg asthma

<>1995je28:KZXan adopted a new oil and nrg.g law which is widely recognized as a critical step in attracting foreign ekn investment. Among other measures, the law contains a broad provision for competitive bidding on nrg prj~. Also under the law, the Kazak [sic!] gvt may grant exploration rights by competitive tender or through independent, direct negotiations. Contracts may be in the form of joint ventures, service agreements, or production-sharing arrangements [ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

<>1995jy:CZC Industry and Trade Minister Vladimir Dlouhy visited Russia to discuss long-term supplies of natural gas to the Czech Republic. Also on the agenda was Russia's $3.4 billion debt to the Czech Republic, which Russia hopes to pay off at least partly with gas. Finally, the two countries are negotiating participation of Czech companies in the construction of a gas ptpt from Russia's northern Yamal peninsula to western Europe. In addition to Russia, the Czech Republic also is conducting negotiations with NOR regarding possible large-scale gas supplies from that country beginning in the year 2000. Increased natural gas imports are becoming more important as nrg.c's traditional role in the Czech energy mix declines for environmental and economic reasons.

In 1994 (as in 1993), the Czech Republic consumed about 240bcF nrg.g - nearly all of which was imported from Russia via the Transgas ptpt system. Transgas consists of four ptpt sections built between 1972 and 1988, with a total annual capacity of 2.60tcF (63% CZC, 37% Slovak). Transgas not only provides gas to the Czech Republic and Slovakia, but also serves as a transit line to GRM FRN ITL & OST.

-----

<>1995au:JPN's Sumitomo {Smt} crp & CAN's SNC-Lavalin Group won a $480m contract to build a large oil xpt nrg.p.zvdy in the Zhanazhol oil field near Aktubinsk. In addition to generating $300m in annual product xpt revenues, the plant is designed to produce 0.50mT of liquefied petroleum nrg.g and 70 bcF nrg.g for dms power generation as early as 1997 [ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

<>1995au:Frontier Oil Exploration Company [css] became the first USA company to sign an agreement for a conventional exploratory concession in POL. Other active U.S. companies include Tex.crp.nrg, which received a concession soon after Frontier, and Exx.crp.nrg

<>1995au22:Exxon, America's largest oil company, began toying with the idea of going east, not west. Exxon envisions its ptpt to carry TKMistan's plentiful natural gas east to the Pacific. The ptpt would pick up Uzbekistan's gas exports and run to China and probably South Korea, with the possibility of a spur to Japan.

Exxon's announcement caught many analysts off guard and leaves many skeptical, but is not entirely outlandish. The most obvious secondary customer for the ptpt is Exxon itself, which is developing a 3.70m-acre nrg.p.ggr & nrg.g.ggr across the Tian Shan range in Xinjiang, in northwest China. Copyright © 1995 N.Y. Times News Service

 

<>1995se09:NYT|>LeVine,Steve| ”Oil Giants May Bypass Russia On Pipeline To Pacific”

MOSCOW - The idea of an energy ptpt across one-fifth the circumference of the globe might be dismissed as somewhat extravagant, even eccentric.

But the Exxon Corp., the Mitsubishi Corp. of JPN and CHN's state oil company have announced a partnership to study just that: a $12b, 4900-mile nrg.g ptpt from the former Soviet republic of TKMan, on the CSP.Sea, to the Pacific - bypassing Russia and Moscow's political and economic leverage.

The riches of the Caspian - once under Moscow's control and now shared by several independent former Soviet republics of central Asia - are among the last major untapped nrg.p & nrg.g.rzv~ in the world [tntn]. And the Exxon proposal, which could result in the longest natural gas export ptpt in the world, is one of the boldest of the dozens of ideas for getting the energy to the United States, Europe and Asia through new routes [tpt], east and west.

The search is driven by the severe restrictions Russia has placed on the flow of oil and gas from the Caspian countries through existing ptpt~ that cross its territory.

Many industry analysts say the idea of a ptpt to the east, across China, is indeed wildly unrealistic. But in even considering the proposal, these former Soviet republics have shown how anxious they are to find alternatives that will speed up energy development and reduce Russian influence.

And for the Western oil companies, open discussion of proposals like this serve to put Russia on notice: much-needed foreign investment in its own borders could be delayed if Russia keeps hampering the flow of energy from its neighbors, impairing the companies' ability to reap profits there.

Experts say the Caspian could become the West's second largest supplier of oil and natural gas, reducing reliance on the PER.G. But the future of these vast rzv~ has created a new point of post-cold-war friction involving Russia, former Soviet republics in Central Asia and the

Caucasus, and the West.

There has been much bitterness over Moscow's efforts to continue to exert control over the former Soviet republics, which are striving to be economically independent. The United States is putting pressure on Russia not to interfere with the development of the Caspian or the sovereignty of the countries nearby.

But the region's development has been nearly paralyzed by Moscow's decision to restrict the use of its energy ptpt~ to ship Caspian oil and natural gas to export markets.

With its current monopoly over ptpt~, Moscow has sought political, economic and military concessions from the former Soviet republics. Russia has enlisted the support of IRN, which also borders on the Caspian, to demand a veto over any energy deal involving any of the other nations on the sea. Moscow has also insisted on equity in projects that have already been negotiated.

AZR, KZX and Western [“zpd”] companies have rejected the veto. Instead, the Caspian republics are seeking a secure way to a Western sea - ptpt~ that can get their oil past Russia.

“AZR and Kazakhstan would like to have a ptpt circumventing Russia”, sd Robert Ebel, energy director at the Center for Strategic and International Studies in Arlington VA. “When a ptpt crosses your territory, you have political leverage over those putting oil into the ptpt”

The Caspian, the world's largest inland sea, is at the center of the former Soviet region that was regarded by Moscow primarily as a supplier of raw materials. But with the collapse of the Soviet Union in 1991, Western energy experts began predicting an economic boom in the region, and the republics began seeking the benefits.

Together, AZR, KZX, TKM and UZB have at least enough oil and natural gas to exceed the peak daily output of the North Slope of Alaska, and probably much more, geologists say.

By 2015, when AKA and EUR's Nrt.S rzv~ are nearly exhausted, these four countries should be producing, by conservative Western estimates, daily exports of about

 1.80bB nrg.p and

13.0cF nrg.g

But there must be ptpt~ to get all that nrg to mkt

Western oilmen and diplomats say that in its efforts to obstruct the ptpt development, 1993no:MVA stopped nrg.g xpt~ from TKM, a flow that had been worth

$2.0b/y. The blockage has stripped away TKM's major cash earner and produced a steep ekn decline.

Russia also has obstructed a

$7.50b deal in AZR that includes

Amo.crp.nrg,
Pennzoil and
Exx.crp.nrg

To try “to appease” !! MVA, Luk.crp.nrg, Russia's largest oil company, has been awarded a 10% share.

In addition, Moscow has restricted and sometimes halted nrg.p & nrg.g xpt from KZX. This has slowed a $10b, 40-year investment by Chevron Crp [Chv.crp.nrg] at the giant TGZ.nrg.p.ggr in KZX because there is no other way to export the oil that could be produced.

There are similar problems with a planned multibillion-dollar deal with British Gas and Agip of ITL at the huge Knrg.g.ggr in KZXan, reducing it to a simple maintenance contract.

Meanwhile, Russia's gzz.mpy, Ggzz.crp, has demanded and received a 15% share of the Western [“zpd”] stake

One major player in the dispute has been Mnr1 Chernomyrdin [QdnVS?], who once ran Ggzz.crp and who is reported to control a large financial stake in the semi-privatized company. His former aides at Ggzz.crp, including Energy Minister Yurii Shafranik, control the Russian energy industry and have demanded a strong Russian role in CSP.S prj~

“Russia wants to preserve a measure of economic control and probably increased military influence in the majority of former Soviet nations, and the Caucasus and Central Asia are weak”, sd John Roberts, who studies the ptpt issue for the London-based consultants MEC. [!! No mention of ekn INX]

To get the energy to the market, the republics and their Western partners are examining two basic ptpt routes, east and west.

West, to the Mediterranean two key proposals

NO.1: For KZXan, the issue is a proposed $1.20b ptpt traversing Russia and terminating at the BLK.Sea port of NVR. From there, the crude would go to the Mediterranean for sale to Western customers

This ptpt is stalled over a quarrel between

(1) Chevron [Chv.crp.nrg] Tengizchevroil [TGZ.nrg] joint venture,the main customer, &
(2) RUS & KZXan (& others?) ptpt consortium

Chevron [Chv.crp.nrg] has objected to footing most of the bill while the other outside partner, the Oman Oil Company, puts in almost nothing. Chevron wants to reduce or exclude the Omani company and its president, John Deuss.

Russia supports Deuss, who was originally brought in by the KZX~. Many Western analysts think Russia simply wants to stall construction of a Kazakhstan ptpt.

NO.2: The second big ptpt would start in AZRan, on the other side of the CSP.S. There are two competing ideas.

2a: One is to go north, through troubled QQN, also to NVR

2b: Avoids RUS and traverses TRKy, ending at the port of CYN

This dispute has its own historical and geopolitical character based in the traditional rivalry between Russia and Turkey.

A consortium of 10 oil companies is approaching an 95oc09:Deadline to decide which route to use

for the first AZR production next year. The republics do not want to grant Russia a continued tpt monopoly. But the deciding factor for the consortium, officials say, is how Moscow would react if Turkey were chosen.

On Monday, Russia tried to push Turkey out of the competition. A Russian official, trying to match incentives offered by Turkey's Prime Minister, Tansu Ciller, announced a cut in ptpt txx.tariffs of 20 to 70% for 7 or 8y if Russia is chosen as the sole route.

The ptpt dispute has become an increasing irritant between Moscow and Washington. President Clinton has raised the TGZ issue with President Boris N. Yeltsin at least twice, Energy Department officials say, while Vice President Al Gore has repeatedly asked Chernomyrdin to help clear the obstacles to TGZ.nrg.p, with no results.

Washington expressed its displeasure openly by publicly endorsing a Turkish route for the AZRi ptpt, avoiding Russia. Energy officials say the Administration distrusts Moscow's ability to consider the ptpt~ on a commercial basis, eliminating political or military aims.

 

<>1995se18:se22;RUS SAR|{ptpt} "USA-Ggzz.crp Conference on Natural Gas Pipeline Standards and Project Finance." This was the USA's first major industry-government meeting with Ggzz.crp, the largest nrg-producing company in the world, with an estimated worth of over $115.0b. The event improved USA opportunities to work with the company expected to dominate one of the world's most important and fastest growing nrg markets in coming decades.

Saratov, once closed to foreigners because of its thriving military industry, is a center of Russia's natural nrg.g industry. At the site, which is southeast of Moscow near the VLG.R, conference participants had the opportunity to see natural nrg.g tptation and distribution facilities firsthand.

"The conference was a milestone in USA nrg relations with Ggzz.crp," said Kay Thompson, deputy director of [xpt] DOE's Office of Energy Exports and head of the USA delegation to Saratov. "Besides the valuable contacts and extremely positive relationships formed, the conference led to an increased understanding of Ggzz.crp's needs and immediate possibilities for commercial cooperation. Events such as this are essential for helping USA industry maintain its edge over foreign competitors in the Russian natural nrg.g market."

The conference was held under the aegis of the Gore-Chernomyrdin {QdnV} Commission [GQ.kmm] and the USA-Ggzz.crp Working Group, which is examining environmental {enx} and economic issues related to nrg.g. The USA team on the working group is led by the Department of Energy (DOE) and Environmental Protection Agency and is co-chaired by Thompson.

Conference topics included ptpt tkhies, enxal safety and monitoring, and emergency response as well as USA sales and investment opportunities. Thompson noted that one major issue discussed was the refurbishment of Ggzz.crp's trunk ptpt, a priority for the company.

"The conference served as an excellent forum to exchange technical information on deployable nrg.g ptpt technologies. It also brought the Russian and American nrg.g industry together to explore potential opportunities for commercial partnerships and potential project finance sources," Thompson said.

A number of joint ptpt projects are already under way with Ggzz.crp, including a valve maintenance demonstration project with Sealweld Corporation intended to reduce methane emissions. Another joint project with PIM Pipeline Services, Inc., focuses on state-of-the-art techniques to locate ptpt coating defects.

Approximately 60 USA participants, including 36 representatives of companies and associations and nine representatives of USA financial institutions, participated in the conference along with approximately 100 representatives from the Russian natural nrg.g industry.

The USA-Ggzz.crp Working Group will report on its progress, including the results of this conference, to the GQ.kmm at the commission's next meeting. Patricia Godley, DOE's Assistant Secretary for Fossil Energy and a key figure on the Energy Policy Subcommittee of the GQ.kmm, is spearheading DOE's contributions to GQ.kmm work.

For more information and an agenda of the conference, call:

Media inquiries: Amber Jones or Penny Adams, 202/586-5806

Other inquiries: Public Information, 202/586-5575

[995de12:DOE Fact Sheet]

 

<>1995fa?:RUS Yamal to POL nrg.g.ptpt|In connection with the planned construction of a nrg.g ptpt from the Yamal peninsula in Russia to WEUR, CES Consulting Engineers Salzgitter GmbH was appointed to carry out a full-scale Environmental Impact Assesssment for the section between BRUS and GRMy.

<>1995oc,m:AZR Baku|Deal announced for construction of a ptpt across AZRjan and GRZ to Supsa. TRKy is also a major competitor w/ Russia for any oil xpt~ coming out of the rgn

[ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

<>1995de08:WSJ| "Russia cracks down on tax defaulter"
*1995de20:Houston Chronicle| "Russian oil reform bill passes..."
*1995de26:WSJ| "Major investment in Russia is stymied"
*1996ja02:NYT| "The new great game in Asia"| [ID "New Great Game" with good "Eurasian" geo-political MAP | CF=Concept "NooPolitik" = more accurately "noöspolitik"]
*1996ja03:WSJ| "Russian oil law...|
*1996ja09:Boston Globe| "Russian spill called worse than feared"|
*1996ja11:Houston Chronicle| "Russian oil producer now trading..."|
*1996ja12:WSJ| "World wire:Russian oil output declines"

<>1995de16:Russia: Possible Dominance of World Oil Industry
-Anonymous. "Mideast Mirror," 95de16:Financial Times Limited International Report

This article presents the reader with a rather fantastic scenario. When the IRQ oil embargo is lifted and IRQi production resumes, this article speculates, IRQ may choose not to rejoin OPEC, and enter instead into a partnership with Russia. Combined Russian and IRQi output is greater than "the best Gulf oil production", and such an arrangement could put Russia in a position to control world oil prices [tntn.ekn]. Indeed, Russian and IRQi companies have already drawn up a number of joint ventures "which are ready to roll the moment the IRQ oil embargo is lifted”.

 

 

<>1996:1999; Three years of big mergers = Chevron+Texaco | Conoco+Phillips | Total+Petrofina+Elf

<>1996wi:Operating Profile

SIDANCO possesses one of the largest recoverable hydrocarbon rzv~ in the world and ranks second by rzv~ in Russia. At 1st January, 1995, the recoverable rzv~ were:
Crude Oil - 2.60bT (19,110mB)
Natural Gas - 1.20tcM (42.30tcF)
Condensate - 48.40mT (355.0mB).

At 1995 levels of oil production, the company has oil rzv~ to last for nearly 100 years.

From now until the year 2000, the company intends to build up its extractable oil rzv~ in volumes exceeding annual production.

Excluding joint ventures SIDANCO fxx
118 oil deposits including
42 nrg.p.ggr
24 nrg.g & nrg.p.ggr
5 nrg.p & nrg.g.ggr
11 nrg.g.ggr,
7 condensate nrg.g.ggr and
29 nrg.p & condensate nrg.g.ggr

  Major deposits are:
Northern Samotlor
Varyeganskoye
Krasnoleninskoye
Verkhne-Chonskoye
Verkh-Tarskoye
Chutyrsko-Kiengopskoye
Kovyktinskoye

SIDANCO occupies one of the foremost positions in the Russia oil industry when measured by volume of extracted crude oil and nrg.p.zvd- oil products:
Oil extraction and refining
(mT a year)

                                                        1994      1995    1996  (target)
nrg.p nrg.g condensate production*  29.1       27.0     25.7
nrg.p refining                                    19.4       20.0     21.5
* Joint ventures included

Apart from oil, SIDANKO extracts natural and oil gas:
2.4 bcM (77.5 bcF) in 1994 and
2.4 bcM (77.5 bcF) in 1995, and it hopes to produce
2.1 bcM (67.8 bcF) in 1996.

The stock of extracting and injector wells at the end of 1995 stood around 16,000 units of which 12,000 were producing wells.

The total maximum crude throughput of SIDANKO's three nrg.p.zvdies is equal to 39 mT.

To tpt and distribute oil products to customers, SIDANKO has 146 nrg.p.zvd product depots with a total reservoir capacity of 3.90mcM and 811 car filling stations, capable of selling 40mT.nrg.p products annually. The reservoir capacity of the nrg.p.zvdies exceeds 1.50mcM

SIDANKO's share of RUS’ nrg.p.zvd- nrg.p product mkt~:
dms mkt = 12.0%;
xpt mkt   = 13.2 %.

In 1996, SIDANKO is planning to xpt about 7 mT.nrg.p.

© RusInfOil 1996 [SOURCE]

 

<>1996wi:What role does Russia play in the world economy? {xpt-mpt tntn.ekn} Russia today is taking a bigger and bigger role in the world economy. In particular, Russia has increased xpt~ of nrg.g, nrg.e, and metallurgical, chemical and timber production. In 1995, Russia had its best xpt year since reforms began in 1992, an increase of US$10.20b to $55.0b. At the same time, imports increased by US$5.40b to $32.50b, widening Russia's trade surplus from $17.70b to $22.50b (during the first three quarters of 1995). Western Europe, as a whole, is Russia's largest trading partner:
39.5% of RUS xpt to WEUR and
41.9% of RUS mpt frm WEUR

  Individual countries:

#1 = UKR:
09.1% ($5.0b) to UKR and
13.2% ($4.30b) frm UKR

#2 = GRM:
07.5% ($4.20b) to GRM and
15.0% ($4.90b) frm GRMy

#3 = USA:
05.7% ($3.10b) to USA and
05.7% ($1.90b) frm USA

xpt~ to the USA rose by 27.8% and included aluminum products, iron and steel products, and pig iron. Imports from the USA increased by 25.1% and included poultry meat, milk/dairy machinery, medical instruments, tobacco products and machinery parts.

RUS trade surpluses with South America and Asia also surged during the first nine months of 1995

xpt~ to South America with the highest growth were {nrg.p} petroleum products, newsprint, iron and steel.

For Asia, it was aluminum, fertilizer, nickel & nrg.c having the largest growth.

Below is a listing: 1995:top five xpt frm RUS w/$value:
nrg.p (crude) $8.983446b
nrg.g         8.594175b
nrg.p (other) 3.702416b
aluminum    2.374310b
copper      0.815494b

Below is a listing:  1995:top five mpt to RUS in 1995 w/$value:
white sugar...........$0.528237b
medical instruments... 0.515090b
meat, poultry......... 0.481639b
food process mach..... 0.468528b
aluminum ores......... 0.414929b

Of the top twenty mpt items, food/beverage products made up 48.9% of the total value.

[ Information was obtained from the US Embassy trade report, at http://www.itaiep.doc.gov/bisnis/cables/960220r2.html ]

 

<>1996wi:Table 57 [http://www.odci.gov/cia/publications/hies96/f/f_15.htm]

Proved Reserves of Crude Oil and Natural Gas, Year end 1995 [p.rzr~ of nrg.p & nrg.g]

Place |Crude Oil b |Natural Gas b
(bB) |(tcF)

OECD =
USA |22 |164
CAN |5 |67
NOR |8 |47
EUn
GRM |NEGL |11
ITL |1 |13
NED |NEGL |65
UKi |4 |23

Selected Eurasian =
RUS |35 |1,200 (30.6%)
ROM |2 |13

OPEC =
Algeria |9 |128
Indonesia |5 |69
IRN |88 |742
IRQ |100 |110
KWT |94|52
LBY |30 |46
Nigeria |21 |110
Qatar |4 |250
SaA |259 |185
United Arab Emirates |98 |205
VNZ |64 |140

Other =
Brazil |4 |5
CHN |24 |59
Egypt |4 |22
India |6 |25
Malaysia |4 |68
Mexico |50 |68
Oman |5 |25
Syria | |7

TOTAL |949 |3919

a The portion of total resources has been assessed as being exploitable under local economic conditions and available technology. [ Source for all countries except Russia: O&G ]

 

<>1996ja02:NYT editorial re.C.ASA & nrg.g, "The New Great Game In Asia"

While few have noticed, Central Asia has again emerged as a murky battleground among big powers engaged in an old and rough geopolitical game. Western experts believe that the largely untapped oil and natural gas riches of the CSP.S
 countries could make that region the PER.G of the next century. The object of the revived game is to befriend leaders of the former Soviet republics controlling the oil, while neutralizing Russian suspicions and devising secure alternative ptpt routes to world markets. [tntn.ekn]

To prevail will require persistence and tact, but the resources justify the attempt. So far, Washington has managed with some skill to avoid obvious pitfalls in the game's opening moves.

The core problem is Russia's determination to control the flow of oil and gas from AZR, Kazakhstan, and TKMistan, whose rulers understandably wish to evade its restrictive embrace. The two major ptpt systems from those areas now run north. Both pass through Chechnya,where one system serves Russia and the other the export market, via the Russian Black Sea port of NVR. There is no ptpt heading south.

Quietly and rightly, Washington has sided with the Central Asian wish for a more secure southern route. The State Department early last year endorsed an alternative ptpt to Turkey. No less than seven possible routes are being considered to bring oil and gas south to ports in Turkey, Georgia, or IRN.

The United States' Exxon, China's state oil company, and Japan's Mitsubishi Corp., in another ambitious scheme to bypass Russia, said in September that they were studying the construction of a natural gas ptpt that would cost $12 billion and would stretch from TKMistan on the Caspian over an enormous arc 4,900 miles to the Pacific.

But what these outside partners regard as a hardheaded commercial decision is viewed by many Russians as incipient interventionism. Russia has historic and legal claims to the CSP.S
 and has insisted that it must be a party to any agreement on sharing oil and natural gas riches.

Moscow's claims go back to the 19th century, when czarist armies conquered these Islamic emirates in an expansionist drive that Victorian England saw as a threat to its rule in India. This resulting rivalry in Central Asia, Kipling's Great Game, continued as a shadowy duel even after the Bolsheviks took over the czarist empire.

Everybody could benefit in the revived game by agreeing to split the winnings. Western and Japanese capital is essential to developing Caspian fields, and some oil companies are clearly willing to plunge forward: Chevron [Chv.crp.nrg], the world's fifth biggest, has already invested $700 million into tapping the huge TGZ.nrg.p rzv~ in Kazakhstan.

The oil, however, is more likely to remain underground for years as various ptpt schemes remain pipe dreams. So balanced are contending parties, so disorganized are the new Caspian republics, and so abundant are known rzv~ elsewhere, that drift is more likely than decision. Ending the deadlock may take a compromise.

Washington is right to support a ptpt route that is not subject to unilateral Russian control. But a hard-pressed Russia has some claim to a share of Caspian oil wealth and historic reasons for worrying about hostile hands on ptpt taps. A compact that addressed those concerns, while equitably sharing profits among the Caspian states and foreign investors, could make all a winner in this complicated game. Copyright © 1996 N.Y. Times News Service

 

<>1996mr07:KZX|Chv.crp.nrg & Mob.crp.nrg have reached tentative agreement with Russia, KZXan, and Oman (the original "Caspian Pipeline Consortium", or CAS.ptpt

1992je:CAS.ptpt formed over a proposed 900-mile, $1.20b oil xpt ptpt via Kropotkin to a new oil terminal on the Taman peninsula near the Russian BLK.S port of NVR. The deal would reduce Oman's share in the consortium to around 10%, with KZXan and Russia making up another 40% combined. This move followed the resignation in January 1996 of Oman Oil Company President John Deuss, who had originated the KZXan-Oman relationship (as well as the CAS.ptpt) and had for several years been a key advisor to the KZX gvt on nrg.p matters. In the revised CAS.ptpt (dubbed by some as CAS.ptpt II), foreign oil companies will account for a combined 50% of the project. These companies include:

Chevron [Chv.crp.nrg] | (15.00% share in the ptpt)
Mobil    (07.50%)
Russia's Luk.crp.nrg        (12.50%)
Russia's Luk.crp.nrg [repeat sic!] (07.50%)
British Gas   (02.00%)
Agip     (02.00%)
Oryx Energy Co (01.75%)

If constructed, the ptpt would represent a major link between TGZ and EURan xpt mkt~. In addition to its commercial value, the ptpt would have significant political implications for the region -- specifically, the extent of Russian influence over the relatively new independent states like KZXan. One option to routing CSP.S oil through Russia would be a ptpt to the new GRZ terminal of Supsa [CF:1995oc,m]

[ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

 

<>1996sp:USA DOE issued illiterate & junky rpt re. 1995ja:”Eurasian Union” [ http://www.eia.doe.gov/emeu/cabs/kazak.html ]

After Russia, KZXan is the second largest oil producer among former Soviet republics. In 1996, KZXan hopes to produce around
0.480mB/d nrg.p, about the same as it produced in 1994 and 1995. Most of this oil is produced by KZXan's two state holding companies -- Munaigaz and Kazakgaz -- largely from the Mangyshlak area in western KZXan near the CSP.S.

{IRN} KZXan's oil production currently is xpted to Russia as part of a swap arrangement whereby Russia supplies crude to two of KZXan's three nrg.p.zvdies (at Pavlodar and Chimkent). KZX crude oil xpted to Russia is generally nrg.p.zvd- at Samara and Ufa. In early April, 1996, the presidents of IRN and KZXan discussed a plan to xpt KZX oil from CSP.S nrg.p.ggr to northern IRN, in exchange for IRNian nrg.p xpt~ out of the PER.G. Cf:1993ap: Chv.crp.nrg agreements w/KZX. CF:1995wi:cutbacks on that deal.

And now, 1996ap:Mob.crp.nrg stepped in to help. Mob.crp.nrg announced that it had purchased from the Kazak [sic!] government a 25% share in the consortium developing TGZ. Chv.crp.nrg and KZXan's Tengizmunaigaz own the other 50% and 25%, respectively. Chv.crp.nrg, which has spent nearly $1.0b on Tengiz development, reduced spending significantly on the project due to disagreement over xpt routes for any oil produced. This disagreement ties in with a broader debate between Russia and other CSP.S rgn states over how the Sea should be treated under international law. Russia cites a 1940 treaty between the Soviet Union and IRN, which says that the Caspian is not a sea, and therefore should be developed in common by all five coastal states. KZXan disputes this view, and counters that each state should have rights to oil and nrg.g resources developed in their own offshore areas.

{Occ.crp.nrg Exx.crp.nrg} Recent joint venture announcements include development of the Karakuduk oil field in western KZXan by USA cmp Chaparral Resources. Karakuduk is estimated to contain 74.0mB.nrg.p (proved rzv~). Canadian Occ.crp.nrg (Canoxy) is heavily involved in developing an estimated 150mB.nrg.p (proved & probable rzv~) in central KZXan's Turgai basin. CAN.Occ.crp.nrg also is prequalified for a 95% stake in Yuzhneftegaz, which operates in the Kumkol oil field, also in central KZXan. Exx.crp.nrg is expected to bid for an 85% stake in KZX oil producer Aktyubinskneft, which produces about 0.050mB/d.nrg.p (crude) from the Zhanazhol and Kenkiyak nrg.p.ggr near the Russian border, much of which is sent by rail to Russia's Orsk nrg.p.zvdy.

REFINING

{KYR SBR} KZXan has three nrg.p.zvdies (at Pavlodar, Atyrau, and Chimkent) which supply population centers in, respectively, the northern, western, and southern areas of the country. In addition, KZXan xpt~ products to Kyrgyzstan and southern SBR. Pavlodar and Chimkent are supplied mainly by crude from Western SBR tpted by ptpt, while Atyrau runs solely on domestic crude. KZXan's Oil and Gas Minister Balgimbayev is aiming to upgrade the country's refining capacity by: 1) building a new $1.50b nrg.p.zvdy at Mangystau; 2) reconstructing the Guryev nrg.p.zvdy at Atyrau; and 3) adding a catalytic refining unit at Chimkent.

((nrg.g JPN FRN CAN ENG)) KZXan also has moved forward with at least 2 other large, internationally cooperative refining projects during the past year or so: CF 1994ap & 1995au))

KZXan also has granted a $1.2 billion contract to France's Krebs-Eurysis to modernize Atyrau, enabling it to produce more light products, and to upgrade its overall capacity from 103,800 b/d to 120,000 b/d. Finally, the Kazak government is cooperating with London-based Vitol in building a new catalytic cracker built at the Chimkent nrg.p.zvdy.

((Mob.crp.nrg BP.crp.nrg Shell.crp.nrg)) Mobil is part of 2 other projects besides TGZ. One is to explore for oil and nrg.g in the 4-million acre Tulpar bloc located in the northwest part of the country. The other -- the CSP.S
 Consortium -- is a group of seven international companies chosen to conduct a seismic survey by 1997 of KZXan's sector of the CSP.S. CF 1993de

((nrg.g ITL Ggzz.crp)) KZXan contains around 83 tcF of natural nrg.g rzv~, of which about 62 tcF are associated with oil or other liquids. Re. giant Knrg.g.ggr CF: 1995mr

Unlike Knrg.g.ggr nrg.g, which is aimed primarily at xpt markets, the 13.0tcF nrg.g rzv~ in the TGZ field are slated largely for domestic consumption. In recent years, KZXan has produced 200 to 250bcF/y.nrg.g (about 1% of former Soviet total nrg.g production), although this volume has been falling sharply in recent years due to the refusal of Russia's nearby Orenburg nrg.g.zvd to take additional Knrg.g.ggr nrg.g

((KZX TKM RUS UZB)) In general, the Kazak nrg.g sector faces a lack of infrastructure, especially ptpt~, connecting nrg.g producing areas in the northwest of the country from nrg.g consuming areas in the south and east. As a consequence, KZXan has been forced to xpt its nrg.g production to Russia, and to meet 90% of its own natural nrg.g consumption needs by mpt~ (mainly from TKMistan, RUS & UZBistan). KZX owes UZB $50m for these mpt~. Given an expected long-run surge in domestic nrg.g demand (for use in industry and nrg.e generation), the Kazak government plans to expand the country's nrg.g transmission grid to help cover 350bcF of domestic consumption.

 

<>1996ap01:MG-052 |THE MISSING LINK: SBRn Oil & Gas and the Pacific Economy

Emma Kiselyova, Manuel Castells, and Alexander Granberg [GO BBL blw] {PaR SBR nrg CHN}

The transformation of world economic order in this end of the millennium is dominated by two major processes: the emergence of the Pacific Rim as the most dynamic area of the new global economy [tntn.ekn]; and the transition of Russia from the Soviet Union to a market economy and an open society. Both processes come together in the gradual integration of SBR and the Russian Far East in the Pacific economy. This is a phenomenon of historic proportions, in spite of obstacles that must be overcome, because of the complementarity between the needs and offerings of SBR and the Asian Pacific. The Asian Pacific economy, arguably the fastest growing and most productive industrial area for the years to come, is highly dependent on nrg and natural resources. CHNa and, to a lesser extent, Indonesia and Malaysia, certainly have considerable energetic and mineral resources. Yet the extraordinary acceleration of economic growth in CHNa, JPN, and the newly industrialized countries in Asia increases exponentially the demand for such resources in the Pacific region.

SBR and the Russian Far East conceivably constitute the Earth's largest reservoir of natural resources, including nrg, still largely untapped. Furthermore, SBR's skilled scientists and technicians, as well as an educated population, provide the necessary labor force for a process of economic development, investment, and trade that will certainly go beyond the limits of a natural resources economy. While it is true that markets for nrg and raw materials are global [tntn], the scale of SBRn rzv~, tptation costs, and political volatility in other areas of the world (particularly in the Middle East) provide a unique opportunity for interaction between the 32 million people of SBR, with its huge assets in natural resources, and the Asian Pacific countries (with a population in the billions, depending upon the units of counting), currently engaged in a process of industrialization, urbanization, and trade of unprecedented scale. Furthermore, firms from all over the world — and particularly American firms — are now so deeply entrenched in the Asian Pacific and in Pacific trade that their prosperity increasingly depends on the prosperity of the Pacific Rim. The Pacific economy will be to the 21st century what the Atlantic economy was to the 20th century. And Russia, because of the extraordinary potential of SBRn resources, could be a major factor in the new Pacific-centered, geo-economic system. SBR could well be the missing link in the Pacific Rim.

However, the obstacles for the dynamic integration of SBR into the Pacific economy are formidable — not only geographic and climatic, but technological, economic, and institutional as well. The Russian Far East was closed to foreigners as recently as 1992, and the region has a tormented history of missed opportunities (Stephan, 1994). In the early 1990s, the chaotic management of post-Communist Russia's transition to a market economy induced a deep economic crisis and reduced to shambles much of the industrial, tptation, and urban infrastructure of SBR and the Far East. Foreign investors were attracted by the prospects of high profits and huge markets, but were soon discouraged by uncertainty, bureaucracy, risk, and lack of support, so they often withdrew, leaving the field open for speculators and smugglers. The conversion of the defense industry largely failed, and the management of nrg industries was troubled by infighting and undermined by technological obsolescence and short-sighted exploitation strategies. Furthermore, Russia's Pacific neighbors often clung to their historical nationalist claims, aiming to take revenge on a weakened power rather than look forward to new cooperative links. And yet, without Russia, the Pacific economy would be burdened by extreme dependence on nrg and natural resources. Without the Pacific connection, Russia would not be able to bring into value most of its territory, and would lose the opportunity to redefine its economic history and geography. Without the Pacific connection, SBR and the Far East would remain the harshest, most forgotten regions of an impoverished, weakened nation, triggering centrifugal tendencies that could contribute to destabilizing an already tense Asian Pacific area.

This study attempts to contribute to the understanding of the complex process of integration between SBR and the Russian Far East and the Pacific Rim by analyzing empirically current trends of regional development and foreign investment and trade. While we open the study with an overview of economic relations between SBR and the Pacific, we will focus our investigation on the oil and nrg.g industry. This is both for practical and analytical reasons. From a pragmatic point of view, the limited resources allocated to this study forced us to concentrate on one industry in the area about which we already had some level of knowledge. From an analytical point of view, it is around oil and nrg.g that most prospective foreign investment and trade seems to gravitate. And it is oil and nrg.g that are the most important strategic resources in SBR, in spite of the current and future importance of other resources such as nrg.c, precious and rare metals, timber, and fish, among others. Indeed, SBR accounts for about one-third of the world's rzv~ of natural gas, and for about 10% of its oil rzv~ (a higher figure than that of any other country outside the Middle East).

Our study will try to identify both the prospects of and obstacles to the process of internationalization of SBRn oil and gas, starting with the analysis of the process of formation of the industry, since the institutional past and industrial history still cast a giant shadow on current developments. After reviewing the overall evolution of the oil and nrg.g industry in SBR since the 1960s, we will focus on current developments in SXL, the most promising Pacific connection of SBRn nrg resources, and the one that, because it is still in its preliminary stage, better allows us to observe the formation of the 21st century's SBRn oil and gas. We will conclude our study by integrating our findings into the broader framework of alternative scenarios for the evolution of economic and political relationships between Russia and the Asian Pacific.

The data and analyses used in this study come from a variety of sources, gathered through different methodologies by the three researchers who are co-authors of the study. The core of our empirical research is the field work conducted by Emma Kiselyova and Manuel Castells in TKO, XBR, SXL, NSB, and Moscow from May to July 1995. We conducted a series of interviews with government officials, company managers, experts, and researchers in this field of inquiry (see list of interviews in Appendix). Our knowledge of the oil and nrg.g industry in SBR was initially built by a study that Valery Kuleshov and Manuel Castells directed in 1992-93 at the Institute of Economics and Industrial Engineering in NSB. In the framework of that study, Manuel Castells and Emma Kiselyova conducted field work research in Tyumen and Nizhnivartovsk in 1992. Some of the findings and insights of this field work have been used in our current study. Additionally, documentation from different sources was collected and analyzed in Berkeley from 1994 through 1996. The overview of SBRn-Pacific economic relations was prepared by Alexander Granberg on the basis of data gathered and analyzed at the SOPS Institute in Moscow. Throughout the two years of the research process, the three researchers involved in the study corresponded and interacted in and between Berkeley, Moscow, and NSB, face to face or by e-mail or fax, to coordinate and integrate findings and analysis. Ultimately, the convergent data analysis led to the present report, whose sources are specifically indicated in the text and in the endnotes for each argument presented. While the character of our research is exploratory, we have attempted to ground our hypotheses on the state of empirical knowledge on the topic to build a foundation from which to proceed in the investigation of an essential theme that has rarely been the object of scholarly research: the integration of SBR's new market economy into the Pacific Rim.

[Monographs, sponsored by The Institute of Urban and Regional Development [IURD],The University of California at Berkeley]

 

<>1996my03:Transition:A Fortnightly Journal of Analysis…. [OMRI] v2, n9

nrg

Russia's Energy Industry Is the Key to its Success -- or Failure by Peter Rutland
Russia's Natural Gas Leviathan by Peter Rutland
Energy Crisis Spurs Ukraine and Belarus to Seek Help Abroad by Ustina Markus

 

 

<>1996au:TURKEY'S NEED FOR NATURAL GAS [ http://www.turkey.org/releases/082696.htm] ((TRK GO 997oc31)) 

By the year 2000, TRKish demand for natural gas, which is
  6 bcM presently, will, at minimum, measure
21 bcM . By 2020, that demand will at least double.

   The only natural nrg.g Turkey imports via ptpt is from Russia. Turkey imports additional sources of natural nrg.g through other means.

   TRKey depends on natural nrg.g from Russia for 75% of its domestic demand. Other forms of natural gas, such as LNG or liquified natural gas, is very expensive to import due to shipping, processing and storage requirements.

   Clearly, Turkey needs to diversify and minimize the costs of its natural nrg.g imports.

   If Turkey cannot import natural nrg.g via a direct ptpt in the forthcoming year, Turkey's ability to meet its nrg requirements will be in serious jeopardy, thus, adversely effecting all sectors of TRKey's economy and household services. (See attached USDOC: ITA report on "The electrical generating equipment in Turkey," February 1994)

   Among the alternatives, the IRNian natural nrg.g ptpt project is the easiest and most feasible. However, it will take at least a year to construct such a ptpt.

   Because of this pressing reality, TRKey is compelled to arrive at a contract in the next 1-2 months in order to ensure its urgent requirements for its nrg needs.

   The Natural Gas Pipeline Agreement [ptpt.trt] between the TRKish Minister of Energy and the IRNian Minister of Oil was originally signed in May of 1995. (See "Turkish Perspectives in Turkish-US Relations Concerning PER.G Security in the Post-Cold War Era: 1989-1995," Mahmut Bali Aykan, Middle East Journal, Volume 50, No. 3, Summer 1996, page 355.) The Agreement signed on August 12th was a duplicate of that original with some minor changes.

   Contrary to some allegations within the framework of the IRN Oil Sanctions Act of 1996, the ptpt project is not an investment in IRN but a means to realize a trade deal for importing natural gas. The deal envisions each party constructing part of the ptpt on its own territory.

$20.000b = IRN xpt total for nrg.p products
$00.680b = IRN xpt total for nrg.p products to TRK

ENERGY NEEDS OF TRKEY:
Source: USDOC, International Trade Administration report on
"The electrical generating equipment market in TRKey," February 1994:

   "TRKey's ... electricity demand ... is expected to increase to 308 billion kWh by the year 2010. TRKey is expected to be faced with an nrg shortage at the beginning of 1996. Even if all current hydroelectric potential can be used entirely, the total output thus obtained will be far from sufficient to meet anticipated requirements by the year 2000. According to estimates, without using nrg resources other than hydroelectric or lignite for power generation, TRKey's hydroelectric economic capacity will be fully utilized and thermal nrg resources will have been exhausted by the year 2010. Therefore, imported natural gas, imported nrg.c and nrg.n are needed to bridge the gap. Turkey has been importing natural nrg.g from Russia since 1987 for electricity production and residential heating in large cities. Turkey's consumption has increased since that date from 350 mcm to 4.4 bcM (bcm) in 1992, and 5.5 bcm in 1993. (By the year 2000 three new C.C.P.Ps will be built making the total installed capacity to reach 4.500 MW.) The forecast is that demand for natural nrg.g will increase to 25-30 bcm by the year 2000 and 35-40 bcm by the year 2010. Currently 60% of the natural nrg.g is used in power generation, 30% by domestic industry and 10% for residential heating. There are proposed plans to carry natural nrg.g from TKMistan and IRN to European markets via ptpt~ through TRKey from which TRKey would also obtain natural nrg.g for power generation. The US Trade and Development Agency (TDA) has provided a grant to the TRKish government's ptpt company, BOTAS, for a feasibility study for a second Liquid Natural Gas (LNG) terminal."

<>1996au22:TRKy to sign nrg.g ptpt deal with Russia

TRKey's state ptpt concern Botas said it will sign an agreement with Russia end September for a $ 1.10b natural nrg.g ptpt from Russia through Turkey's eastern border. Botas said in a statement that the ptpt would be 1160km (725m) long and be able to carry up to
16.0bcM/y

The existing ptpt from Russia will be upgraded through a loop and compressor system, which is currently being built in Pendik, to the east of Istanbul, under a $40m project. Turkey, in urgent need of energy resources, struck a 23-year, $23.0b agreement with IRN in early August to get
03.0bcM/y nrg.g beginning in 1999 through a ptpt. The amount will raised up to
10.0bcM/y by 2005.

The design of the new ptpt from Russia will be completed by the end of this year and construction work could begin in 1997. Turkey would receive a total of

9.20bcM nrg.g this year, up 2.40bcM from last year, including LNG imports equivelant to a total of
2.480bcM.

Expansion work at an LNG terminal in western Turkey has recently been up for tender and this would add a
4.50bcM to supply in 1997. Botas is considering another LNG terminal. Botas has agreed with state Turkish Petroleum (TPOA; ?=TRK.crp.nrg?) to have it build an underground nrg.g storage in western Marmara rgn with a capacity of
2.50bcM.

<>1996se:Exx.crp.nrg agreed to establish the POLish Petroleum Development Company with Shell.crp.nrg

<>1996oc:POL signed a 25-year contract w/ Ggzz.crp. Annual volumes of nrg.g will increase to
14.0bcM (about 494.0bcF) once construction is completed on the Yamal ptpt

2010:YAM-EUR.ptpt will reach full capacity:
65.70bcM (about 2.30tcF)

1997:YAM-EUR will begin delivery to POL:
03.0bcM (about 106.0bcF).

POL segment of YAM-EUR.ptpt is being built by Europol Gaz {bdg} in a joint venture with Russia's Ggzz.crp at a cost of $2.50b (the largest infrastructure investment in the country to date).

USA DOE website [ http://www.eia.doe.gov/emeu/cabs/poland.html ] describes the situation in the following terms: “despite concerns over dependence on Russia”, Poland plans even larger imports of Russian natural gas from the Yamal-Europe Transit Gas Pipeline.

Poland currently produces small volumes of crude oil and natural gas, but relies heavily on imports to meet nationwide demand. Traditionally, oil and natural gas imports have come via ptpt from Russia. To reduce dependence on Russia, Poland has begun to import North Sea and Middle East crude oil and has opened a cross-border exchange link integrating its natural gas transmission system with Germany.

To quell criticisms over growing dependence on Russian energy, the government plans additional natural gas storage facilities and is considering future imports of liquefied natural gas (LNG) from QTR, NGR, NOR, and ALG. It is also encouraging foreign investment in its own upstream oil and gas sector and has obtained loan assistance from the World Bank and the European Investment Bank.

 

<>1996de03:Natural Gas Vehicle in Spotlight at Shinjuku Auto Show[http://www.theautochannel.com/news/date/19961203/news02662.html]

Comline reports that the Japan Gas Association is one of the sponsors of an exposition of nrg.gl vehicles in Shinjuku's Park Tower in JPN. All of JPN's natural nrg.g auto manufacturers will participate in the show. Natural nrg.g vehicles drive 150-200 km between fill-ups, are cleaner to operate than ordinary nrg.g or diesel vehicles, and emit far less nitrous oxide and carbon monoxide than their traditional fuel counterparts. Late last year JPN's Ministry of Transport {Mtpt} approved natural nrg.g vehicle for ordinary usage. By the end of October 1996, there were 917 natural nrg.g vehicles were on the road in JPN, including buses, sanitation vehicles, and other public-service autos. The nrg.g industry hopes that 200,000 will be in use by the year 2000. The Shinjuku show features vehicles that are already for sale or that will be offered in the near future.

Paul Dever -- The Auto Channel
((Check 97se09:http://www.gas.or.jp/ngve/))

 

<>1997wi: http://wotan.wiwi.hu-berlin.de/~houssik/Armenia/Other/10083.html

1996: OVERVIEW OF FUEL AND ENERGY INDUSTRY IN RUSSIA

As of early 1996:
2325 crude nrg.p & nrg.g.ggr~ had been discovered in Russia, including
1549 nrg.p.ggr
  394 nrg.p and gas/oil and nrg.g condensate ggr~, and
  382 nrg.g and nrg.g condensate ggr

Already-explored oil rzv~ account for an aggregate of not more than 34% of total nrg resources, compared to only 15.6% for already-explored nrg.g condensate rzv~. More than three fourths -- about 76% -- of discovered oil rzv~ are concentrated in 12 individual and 156 major deposits. Western SBR, the major oil-producing province of Russia, contains 72.2% of explored resources, the Ural-Volga region 15.2% and the Timan-Pechora province 7.2%. About 3.5% of discovered rzv~ is located in Yakutia, Krasnoyarsk territory, Irkutsk region, on the Pechora bed and on the Okhotsk Sea shelf.

Many major deposits have already been exhausted to a significant degree, especially:
Samotlor (65%)
Fedorovo (58%)
Mamontovo (72%), these three deposits of West SBR
Romashkino (85%)
Arlan (77%) these two in the Ural-Volga region
Usinsk (58%) in Komi

Between 1986 and 1990, 515 oil and nrg.g deposits were discovered, including 46 major and 113 medium-sized deposits. In 1991-1995, the number of discovered deposits totaled 215, including 7 major and 28 medium deposits.

1986:1991;Each discovered deposit contained an average
10.80mT.nrg.p and
69.60bcM nrg.g

1991:1995;these figures fell to
03.8mT.nrg.p and
11.5bcM nrg.g

The production of liquid fuel has fallen significantly as well.

1987:1988; 569.50-568.40mT.nrg.p & nrg.g condensate per year (peak)

1994:1995; 306.50-317.00mT

Between 1988 and 1995, crude oil production decreased by 263.0mT (46.2%)

In West SBR, it fell by 47% and in other regions by 44%. Domestic consumption of oil and nrg.g condensate did not change significantly, rising from 205.4-215.1 mT in 1986-1989 to 216-220 mT in 1990-1993. In 1994-1995, it fell to 190.5-181.5 mT.

Declining oil production came about from the following causes:
the lack of modern technology and equipment for developing deposit collectors;
a disequilibrium in oil, equipment and materials prices;
the loss of old systems of centralized management, which were not replaced by any new system;
the 350% fall of drilling in 1988-1995;
slow development of newly discovered deposits
On the SXL shelf alone, major deposits discovered in the 1970s and 1980s have not yet been developed despite significant investments and huge potential markets in JPN, SKOR and Taiwan;
slow development of West SBR's resources;
long periods of idleness for many oil wells (27% of the time as of November 1995).

Russia is first in the world in terms of explored nrg.g rzv~, which totalled
49.0tcM on 1995ja01, with an exploration rate of 24.6%

Over 78% of ABC1 explored rzv~ and 90% of production are located in Western SBR (especially the Yamalo-Nenets Autonomous District).

nrg.g rzv~ are largely concentrated in individual and major deposits:
  21 individual nrg.g.ggr (with rzv~ standing at more than 500bcM each) = 74.1% of explored nrg.g rzv~
118 major nrg.g.ggr (30 to 500bcM) for 23.3%
591 medium and small nrg.g.ggr for only 2.6%.

During the period of economic reform, Russia's fuel and power complex endured significant changes. Between 1985 and 1990, primary fuel production rose 13.3% and consumption by 9.5% -- respectively, from 1.6900bT to 1.9140bT of conventional fuel and from 1.160bcM to 1.270bcM of gas).

From 1991 through 1993, both production and consumption of primary fuel fell respectively by 22% and 12.7%.

The pace of decline was still higher in 1994-1995. The balance of fuel in Russia is environmentally clean, with the share of nrg.g standing at 46.2%, oil 29.2%, and nrg.c 18.4%.

It is expected that in the years to come, annual nrg.p xpt~ to countries outside the CIS will reach
100-130mT/y nrg.p
130-150bcM/y nrg.g

Annual Oil and nrg.g xpt~ to the CIS and Baltic states should reach
30-50mT nrg.p
90-120bcM nrg.g and
20-39mT nrg.c

Annual production for the years 2000-2010 is forecast at
370-400mT nrg.p
700-900bcM nrg.g and
350-380mT nrg.c

It is also predicted that, 2000-2010 annual growth of explored rzv~ will reach
780-800mT nrg.p
1400-1800tcM nrg.g, and
700-760mT nrg.c (2)

1996ja:1996je;RUSSIAN OIL PRODUCTION FIGURES

Preliminary data from Russia's Main Energy Computer Center show that the country produced
150.160mT nrg.p, right in line with output targets but 2% less than in the same period last year
27.460mT (7% above target levels) for Luk.crp.nrg
17.470mT (2% over target) for Yukos
16.450mT (2% below target) for Surgutneftegaz
12.520mT (3% more than planned) for Tatneft. (3)

1996ja:96je;RUS Ministry for CIS Affairs said that Russia had xpt- to former Soviet republics [CIS]
12.2380mT.nrg.p
  42.70bcM nrg.g
104,600 tons of {nrg.m} gasoline,
131,200 tons of diesel fuel and
156,300 tons of furnace fuel oil

This represents about 95% of xpt~ to the CIS over the same period last year. Gasoline, diesel fuel and fuel oil supplies to former Soviet countries fell by 11, 64 and 66% respectively, ministry experts said. Ukraine imported 3.8 mT of Russian oil, 30.5 cubic meters of natural gas, 25,300 tons of gasoline, 37,300 tons of diesel fuel and 19,300 tons of furnace fuel oil and Belarus bought 6.28 mT of Russia's oil and 7.4 bcM of natural in January-June 1996. (4)

1996ja:1996je;RUS nrg.p xpt outside the CIS [Russia's Economics Ministry source]

xtx includes shipments for state needs and nrg.p tpt from KZXan
60.00mT = Total
42.60mT = ca. RUS oil-producing cmp~ xpt-| Leaders in this midst:
06.20mT = Luk.crp.nrg xpt
04.20mT = Yukos xpt
03.80mT = Surgutneftegaz xpt

Russia's domestic oil xpters in this period shipped more than
09.10mT in order to carry out state programs and intergovernmental agreements.
03.10mT = xpt nrg.p shipped by joint ventures operating in RUS

The greatest volume of oil produced by joint ventures was xpt- to GRMy, according to reports from Mekn

M.nrg xperts noted that oil xpt~ grew by 1.2% in these months compared with the same period last year. Oil producers' share of the total volume of xpt was about 70%

USA DOE website report on recent years nrg.g production and xpt:

1996 total net nrg.g xpt =
6.9tcF (highest ever, exceeding the record set in the previous year)

Russian net gas exports outside the FSU in 1996 were also a record:
4.40tcF exceeded the previous high in 1995 by 0.20tcF (almost a 5% growth)

These high export levels were achieved despite a slow decline in gas production from
22.60tcF (1992) to
21.00tcF (1995) and
21.20tcF (1996)

Increased gas xpt made possible by a decline in domestic consumption

During the 1992-1996 period gas consumption fell by
02.10tcF

1996:total net nrg.g xpt~ reached new highs, and the destination of exports has changed over the past few years. The share of net exports to countries outside the FSU has increased from
51% (1992) to highs of
64% (1995-1996)

nrg.g xpt ptpt to zpd via several very large ptpt~ that pass through UKR to EUR:
Brotherhood (Bratstvo)
Progress
Northern Lights
Union (Soyuz)
Volga/Urals-Vyborg to Finland (smaller)

 

<>1997fe: RUSSIAN COMPASS SPINS WORLD DIARY: Without a contract to end World War II, little trade is possible
Oil leaves the wrong mark on JPN
By Crocker Snow Jr., editor-in-chief of The WorldPaper.
© The WorldPaper (US). All Rights reserved. [http://www.worldpaper.com/Feb97/diary.html]

The breakup of an aging Russian oil tanker and the subsequent oil spill in mid-January means more than the pollution of abalone, seaweed and other staples of the JPNese diet. This accident, which occurred off the western coast of central JPN near Fukui Prefecture, symbolizes some of the difficulties for the two neighbors of Northeast Asia doing business together.

There is certainly mutual need. The Russians have oil and other natural resources in abundance. The JPNese have an appetite-and talent-for exploiting them to manufacture the very consumer goods that the Russian people crave. But the creaky nature of the Russian economy, illustrated in this instance by a 26-year-old tanker, Nakhodka, that broke up in heavy seas, is anathema to the well- prepared, well-rehearsed and buttoned up nature of JPNese economic activity. The 0.1330mB.nrg.p (heavy fuel oil) carried by the nrg.p.nvy, almost half of which escaped, are despoiling Russo-JPNese potential as much as the shoreline itself.

There's another problem in Russia-JPN relations, dirtier and more enduring than this spill, the second-largest in JPNese maritime history. Russia and JPN are at war, at least on paper. The two neighbors, adversaries in the Russo-JPNese War of 1905 and again in the middle of the century, potential economic allies always, still have not put pen to paper to sign a peace treaty ending World War II. Four sparsely inhabited little islands off JPN's northern island of HKD are the ostensible reason why.

These islands, with the almost rhythm-and-blues names of Kunashiri, Etorofu, Habomai and Shikotan and a total population of about 20,000, were occupied by the Russian Army in the closing days of World War II. To do so, Moscow broke a long-standing neutrality pact with TKO and declared war in August l945, three days after the US atomic bomb was dropped on Hiroshima. They remain in Russian hands, an occupation that long served as the perfect excuse for the JPNese government to avoid mending its fences with the Evil Empire during the Cold War.

But the islands are a poor excuse today. The Russians have acknowledged that less than 3,500 military men are stationed there, and Habumai is without any military presence at all. In 1993, a joint declaration between Russian President Boris Yeltsin and then JPNese Prime Minister Morihiro Hosokawa set the wheels in motion for a settlement of this contentious issue. The keys were joint development of the islands and a gradual return of JPNese sovereignty.

But, despite this and the first visitation rights for more than 2,700 Russians and JPNese displaced across the island divide, no agreement has been reached and thus no official end to the hostilities of 1945.

More than anything else, this territorial dispute has inhibited the evolution of mutually beneficial JPNese-Russian trade. The JPNese, more than 95% dependent on imported oil, have long been eager-and willing to pay-for a ptpt from the shores of the Sea of JPN to the bounteous Tyumen nrg.p.ggr in the heart of Russian SBR, over 2,500 miles away. Overtures have been made, plans drawn and some agreements with major JPNese construction companies signed. But it hasn't happened.

Sergei Khruschev, the research-oriented son of the late shoe-pounding Soviet premier Nikita Khruschev, wrote in Asia Inc magazine last year that Russia's Far North accounts for
65% of Russia's oil rzv~
85% of natural gas
63% of nrg.c
90% of nickel
67% of timber
80% of the gold and
95% of the diamonds

This is motivation for JPNese business with a capital M.

But a JPNese government paper last year [1996], JPN's Policy on the Russian Federation, splashed official cold water on this potential. "Due to continuing non payment of uninsured trade debts and inadequate legal and taxation systems in Russia, there is little economic activity between JPN and Russia," the report stated. "Conditions for trade and investment between the two countries need to be improved in order to stimulate private-sector economic activity."

Fresh efforts by the JPN-Russian InterGovernmental Commission on Trade and Economic Problems, coupled with the stimulus of a meeting between Russia's foreign minister Yvgeny Primakov and Japan's Yuhiko Ikeda in late November last year [1996no], prompted the release of a $500m xpt-mpt Bank Fund frozen since 1991 because of political and economic turmoil. But official aid for reasons of politics and commercial trade for reasons of profit are two very different animals.

Two way trade between the neighbors amounts to the pitiful total of $4 billion, one third the level of trade between Russia and its historic foe, Germany.

The Russian embassy in TKO, like the massive nation it represents, is central in the psyches of the JPNese. Situated in the heart of downtown, almost in the shadow of the TKO Tower and cheek by jowl with the American Club, the epicenter for successful expatriate business people, it has, in the eyes of the commercial real estate developer-and again like Mother Russia itself-almost classical "location! location! location!" advantages.

Yet the ministers and counselors who call it home are more occupied with securing a final peace treaty that will close the book on hostilities that ended 50 years ago than with facilitating commercial contracts for today. And doubtless they're more energized by the dirty aftermath of the broken tanker Nakhodka than the fresh opportunity represented by its namesake, the port city Nakhodka, the closest Russian city to JPN, terminus of the Trans-SBRn railway and gateway to Russia's Far East cornucopia of fish, timber and minerals.

For all their potential, Russo-JPNese relations are mired in the past pluperfect.

 

<>1997fe03:PROFILE OF RUSSIAN OIL AND GAS CONSTRUCTION CONGLOMERATE "ROSNEFTEGAZSTROY" [Rsn.bdg.crp]
[http://www.iep.doc.gov/bisnis/isa/9610oil3.html]
SUMMARY [!! this must be dated in 1995]

[…]

5. RNGS IS STRUCTURED AS A JOINT STOCK COMPANY OVER 550 SHAREHOLDERS, INCLUDING MANY OIL AND GAS COMPANIES OPERATING IN RUSSIA SUCH AS
RUSSIAN GAS MONOPOLY GAZPROM [Ggzz.crp]
THE PREMIER RUSSIAN VERTICALLY-INTEGRATED OIL COMPANY LUKOIL [Luk.crp.nrg]
THE MITSUBISHI CORPORATION OF JAPAN {Mcb} AND
THE RUSSIAN OIL AND GAS WORKERS UNION

RNGS RECENTLY COMPLETED A PRIVATE PLACEMENT WITH WESTERN INVESTORS OF THE FIRST TRANCHE (3.2%) OF ITS GOVERNMENT-OWNED SHARES, AND PLANNED PLACEMENTS IN 1995 WILL INCREASE FOREIGN OWNERSHIP IN RNGS TO 10%. ULTIMATELY, THE COMPANY'S GOAL IS 30% FOREIGN OWNERSHIP AND LISTING OF RNGS SHARES ON A MAJOR EUROPEAN STOCK EXCHANGE.

[…]

9. IN ITS NEWLY RESTRUCTURED FORM, RNGS PLANS TO FOCUS ITS BUSINESS DEVELOPMENT EFFORTS ON THE FOLLOWING AREAS:

CIS ptpt CONSTRUCTION: PROPOSALS TO CONSTRUCT NEW OIL AND nrg.g ptpt~ IN VARIOUS PARTS OF THE CIS, PARTICULARLY xpt LINES, ARE PLENTIFUL. ptpt PROJECTS TARGETED BY RNGS MANAGEMENT INCLUDE A MULTI-LINE SYSTEM CONNECTING THE

YAMAL nrg.g.ggr IN NORTHERN RUSSIA TO WESTERN EUROPE

A ptpt SYSTEM CONNECTING THE OFFSHORE SHTOKMANOV GASFIELD (BARENTS SEA) TO RUSSIAN ONSHORE GAS PROCESSING PLANTS

OIL AND GAS CONDENSATE ptpt SERVING OFFSHORE [?nrg.p &] nrg.g.ggr OF SXL.I

ptpt REACHING NEWLY-DISCOVERED nrg.g.ggr IN THE SAKHA REPUBLIC (FORMERLY YAKUTIA) [SXA YAK]

xpt ptpt LINES LINKING KZXan nrg.p.ggr AND OFFSHORE CSP.S TO MARINE TERMINALS ON THE BLK.S &/OR MDX.S

A ptpt LINKING NEW KOMI rxp nrg.p.ggr AND TIMAN PECHORA BASIN TO A PLANNED xpt TERMINAL ON THE BLT.S; AND

CONSTRUCTION OF SOME 280,000km OF nrg.g ptpt GRID EXTENSIONS AND SPUR LINES TO SUPPLY RUS gbx rgn~ w/nrg.g, PARTICULARLY W OF MVA

FOREIGN ptpt CONSTRUCTION: FORMER SOVIET CONSTRUCTION COMPANIES NOW UNDER THE RNGS UMBRELLA HAVE BUILT nrg.p AND nrg.g FACILITIES IN OVER 20 foreign COUNTRIES, INCLUDING GRM, BUL, GRKe, VTN, KWT, YEMEN, IRQ, AFG, ALG, LBY, NIGERIA, LEBANON AND CUBA. OVER THE LAST 15 YEARS, RNGS UNITS HAVE CONSTRUCTED OVER 5,000km OF ptpt OVERSEAS

1994:RNGS CREATED A NEW SUBSIDIARY, ROSNEFTEGAZSTROY INTERNATIONAL {Rsn.bdg.crp}, TO IDENTIFY AND EXPLOIT ptpt bdg AND RELATED BUSINESS OPPORTUNITIES ABROAD.

-- ptpt REPAIR AND MAINTENANCE: RUSSIA'S VAST OIL AND GAS PIPELINE NETWORK HAS SUFFERED GREATLY FROM A DEARTH OF REPAIR AND MAINTENANCE WORK IN RECENT YEARS. RNGS OFFICIALS, CITING RUSSIAN GOVERNMENT AND INDUSTRY PROJECTIONS THAT 1000s OF MILES OF OIL, GAS AND PROJECT PIPELINES PLUS UP TO 100 PUMPING AND COMPRESSOR STATIONS WILL NEED TO BE RECONSTRUCTED IN THE COMING DECADE, SEE A MAJOR MARKET NICHE FOR THE COMPANY AS A PROVIDER OF PIPELINE REPAIR AND MAINTENANCE SERVICES.

-- CIVIL AND INDUSTRIAL CONSTRUCTION: IN AN EFFORT TO DIVERSIFY ITS CLIENT BASE, RNGS HOPES TO BECOME A MAJOR GENERAL CONTRACTOR FOR CIVIL AND INDUSTRIAL CONSTRUCTION AND RENOVATION PROJECTS. IN THE NEAR TERM, THE COMPANY HOPES TO CAPITALIZE ON THE CURRENT UPSWING, ESPECIALLY IN MAJOR CITIES SUCH AS MOSCOW, IN RENOVATION AND CONSTRUCTION OF OFFICE AND HOTEL SPACE. ALREADY, RNGS HAS POSTED ONE SUCCESS BY SERVING AS THE GENERAL CONTRACTOR OVERSEEING THE RECONSTRUCTION OF THE RUSSIAN PARLIAMENT BUILDING (THE TRKISH FIRM ENCA ACTUALLY PERFORMED THE CONSTRUCTION WORK AS SUBCONTRACTOR), WHICH HAD BEEN BADLY DAMAGED DURING THE RUSSIAN GOVERNMENT'S ARMED DISSOLUTION OF PARLIAMENT IN OCTOBER 1994. [sic! 1993oc]

[…]

A/O ROSNEFTEGAZSTROY
ZHITNAYA ULITSA, 14
117970 MOSCOW
TEL: 7-095-238-6677
FAX: 7-095-238-7177
INT'L SATELLITE FAX: 7-502-222-1579
TELEX: 411979 STYK SU

ROSNEFTEGAZSTROY INTERNATIONAL
TRANSCO TOWER
SUITE 5390
2GOO POST OAK BOULEVARD
HOUSTON, TX 77056
TEL: 713-439-0777
FAX: 713-439-1114

 

<>1997ap:USA DOE, Energy Information Administration
World Oil Transit "Chokepoints" [N=7]
RUSSIA [ptpt]
BOSPORUS [nrg.p.nvy]
SUEZ CANAL/SUMED ptpt [& nrg.p.nvy]
BAB EL-MANDAB (RED SEA) [nrg.p.nvy]
STRAIT OF HORMUZ [nrg.p.nvy]
STRAIT OF MALACCA [nrg.p.nvy]
PANAMA CANAL/ptpt [? & nrg.p.nvy]
[NB! No USA AK (ALK) ptpt]

 

<>1997ap29:RTV|Turkey signed a landmark $13.5 billion dollar agreement with Russia's nrg.gas giant Gazprom| The deal covers Russian gas deliveries to Turkey for the next 25 years. Turkey now imports 6 billion cubic meters of Russian gas each year. Under the terms of the new deal,this will increase gradually,reaching 30 billion cubic meters by the year 2010

<>1997ap:TRKey signed a $12.0b agreement to boost its mpt of Russian nrg.g (from the current level of
212.0bcF/y to
494.0bcF/y in 2001

The gas will be shipped through the existing ptpt, which will be expanded by two new joint ventures which will invest $1.50b to add compressor stations and new stretches of pipe to double the capacity.

Demand for natural gas is projected to increase dramatically in Turkey over the next 10-15 years, with the prime consumers expected to be industry and power plants. Several independent estimates see Turkey's consumption nearly tripling to
740bcF by the end of the decade, and reaching
1400bcF by 2020.

Current gas production in Turkey meets just 2.8% of its consumption requirements

1995:Turkey's 14 gas fields produced
007.10bcF

1997:Marmara.S|1st offshore production comes on-line
estimated rzv~=
106.00bcF

The bulk of Turkish gas demand is met by imports. Currently Turkey's main supplier of natural gas is Russia, which assumed contractual responsibility from the former Soviet Union for a ptpt running inside Turkey from the Bulgarian border up to Ankara. Russia began supplying Turkey with
0200bcF.nrg.g/y through the ptpt

1997fe:Russia agreed to increase gas supplies to
0280bcF beginning in 1998

1997fe:Turkey reached an agreement with GRZ to receive RUS nrg.g via a ptpt through its territory. The accord entails the construction of a 19-mile (30-kilometer(km)) ptpt extension to the Turkish border, with initial shipments of
0106bcF/y

Expand & rehabilite GRZ ptpt & increase capacity to
0318bcF/y

RUS also agreed to increase xpt to TRK to
1060bcF by the year 2010

1997ja:RUS Ggzz.crp announced that its board of directors had approved new xpt ptpt-TRK. The $2.50b, 750-mile (1,200-km) ptpt would run from Izobilnoye in southern Russia, to Dzhugba on the Black Sea, then under the Black Sea to the Turkish port of Samsun, and then to Ankara. When completed the line would be the world's deepest underwater gas ptpt. The high cost and complex engineering could push Russia to choose alternate routes (parallel to the current ptpt through Bulgaria or through Armenia).

Turkey has also looked to other sources to increase and diversify its gas supplies

1996fe:TRK & TKM prx~ signed a memorandum of understanding (MOU) which calls for TKM gas exports to Turkey beginning in 1998 at about
0070bcF/y, and reaching
0530bcF by 2020

TRK also plans to sign an agreement to import IRQ nrg.g.

IRQ Oil Minister, Amir Muhammed Rashid, said that an agreement to supply Turkey with
0350bcF.nrg.g over a 10 year period will be signed in 1997jy

The two countries will jointly build a 185-mile(300-km) ptpt needed for the supplies. Turkey's most controversial import scheme is the $20b, 22-year deal with IRN. Initial deliveries of
0105bcF/y nrg.g 1999:scheduled to bgn, reaching
0350bcF by 2005

The supply contract will require construction of three new ptpt~ in Turkey. The local consortium of Fernas and STFA Enerkom won the bid to construct the 46-inch 160-mile (260-km) line frm Dogubeyazit, on IRN border, to Erzurum.

1997ap:Botas, the state-owned ptpt company, requested bids on a 252-mile (403-km) link between Erzurum and Sivas as well as a connecting 288-mile (461-km) ptpt between Sivas and Ankara. This deal has brought criticism from USA, which views the deal as supporting the current IRN regime, and as a possible violation of the Oil Sanctions Act.

LNG

Turkey also plans to utilize imports of liquefied natural gas (LNG) to help meet demand requirements

1994:TRK began receiving
0070bcF LNG from Algeria at the terminal at Ereglisi
on the Marmara Sea. The shipment was part of a twenty-year deal reached with Algeria in the mid-1980s. In 1995 capacity at the terminal was increased to
0105bcF/y

The terminal has also received spot-shipments of LNG from Australia. Turkey has also signed MOUs with Nigeria,

Qatar, and Yemen to receive supplies of LNG

1999:Nigeria will ship
0032bcF/y LNG

1999:Qatar will supply
0070bcF/y for 25-years

2001:Yemen's 25-year deal calls for exports of nearly
0090bcF/y LNG

?when?:Oman also considering shipments

New LNG terminals are also being planned. Plans call for a new terminal adjacent to the existing Ereglisi facility, a second at Aliaga, near Izmir on the Aegean Sea, and a third at Iskenderun on the Mediterranean

1996no:TRK-Egypt signed agreement re.Izmir facility, a $4.0b MOU. The ambitious agreement calls for exports of nearly
0350bcF LNG from fields offshore the Nile Delta. First deliveries of LNG are expected to commence in 2000.

 

<>1997ap22:26;Yeltsin visited CHN [ http://www.china.or.cn/bjreview/97May/97-18-1.html ]
Another Milestone in Sino-Russian Ties by Our Guest Commentator Liu Jiang

[…]

Multipolarity has become the predominant trend of the times. The fourth joint statement signed during President Jiang's visit listed the common understandings reached between CHNa and Russia on the current international situation. In particular, it stated that CHNa and Russia, as two separate poles in the world, follow an independent foreign policy and oppose a single-polar world. Under the current international circumstances, forging a long-term and stable strategic partnership between CHNa and Russia will promote the development of a multi-polar world order, effectively check hegemonism and power politics and contribute to the establishment of a new international political and economic order that meets the expectations of the majority of nations.

Last year, CHNa signed an agreement with Russia, KZXan, Kyrgiz [>KYR] and TDJ on confidence-building in the military field. The five heads of state signed another agreement in Moscow this time on mutual reductions of military forces in the border areas. This represents a major achievement made by the five nations in bringing peace and prosperity to their border areas. The agreement will not only help preserve security and stability in those areas but will also be of major significance to the development of long-term, friendly relations between CHNa and its neighbors. Together, these two documents, the only such agreements in the Asia-Pacific region, will play a positive role in enhancing friendship, building confidence and maintaining peace in the Asia-Pacific region and the world at large. They stand for a new concept of security in the post-Cold War era.

 

<>1997my15:AFG instability cautions Uno.crp.nrg| There may be little end in sight to fighting in AFG, but US Uno.crp.nrg, planning to build a
$2.0b nrg.g ptpt across the war-ravaged country, is for now prepared to wait it out. "It's a waiting game," John Imle, Uno.crp.nrg's president, told. "We've been disappointed that AFGistan remains a country of turmoil." But Imle said Uno.crp.nrg was for the moment prepared to sit and wait. "There are a lot of gas and oil rzv~ to back both these ptpt systems. It'll be a good deal on a stand-alone basis," he said.

Uno.crp.nrg, with SaA's Delta Oil, aims to build the
1,500km (1,000m) nrg.g ptpt from the TKMen-AFG border to N.PAK Multan. There is also an option to extend the ptpt to N.INDia. The gas would come from the huge Dauletabad nrg.g.ggr in SE.TKMan, and over half the route would be located on AFG territory. Imle said Dauletabad had 30 years supply to pipe
0020.0bcM/y (?) to S.ASA mkt~.

UZB prx Islam Karimov, speaking at a regional summit in TKMistan, said the AFG wrx threatened continued isolation from wrl.mkt for the clutch of ex-Soviet Central Asian states. "If the war continues in AFG, not one project here means anything," Karimov said.

Observers are taking the project more seriously now that the purist ISLamic Taliban militia [in AFG] have placed three quarters of the country under its control. Crucial to the project, say observers, is a recognised government which Uno.crp.nrg and other energy firms can deal with.

[CF: 1997sp:REECAS NEWSLETTER|Lumpkin,Jeff (2nd yr grad stud at UW)|”At Play in the Oil Fields of Central Asia”|Mentioned Uno.crp.nrg “on of the most fascinating ptpt proposals”: TKM Charjou via AFG to PAK Karach|Lumpkin rpt- conversations w/Uno.crp.nrg apx at vst where he worked: Taliban and wrx in AFG is no problem, “we’ve got deals with all the warlords. [...] they’re very reasonble when it comes to money”. (2) Chris Taggart, Uno.crp.nrg vprx was quoted in 1996oc29:Trud:4, rtl “Neft’ paxnet krov’yu” sd “Esli Taliby stabiliziruyut obstanovky i poluqat mejdunarodnoe priznanie, to perspektivy stroitel’stva truboprovodov znaqitel’no uluqwatsya.” [NEWSLETTER dates this in 1997oc, but that must be a typo like so much else typographically irregular about the citation] USA denies any role in AFG events, but admits talks w/Taliban leaders. 1996oc11:Delovaya nedelya#39, n217:9|Kenesov,Berik rpt- “Nado otmetit’,qto nameqayuwwayasya napryajennost’ na severnoi granice Afganistana v interesax nekotoryx gosudarstv na zapade”]

The ptpt project was born of what Imle said is landlocked Central Asia's transport bottleneck, with the clutch of ex-Soviet states reliant on existing Soviet-era ptpt~ controlled by Russia. "Transportation is the issue," said Imle. "There is plenty of oil and gas but we decided to enter Central Asia with a transport project," he said. An oil ptpt is also planned to follow the gas ptpt route, with xpt capacity to the Arabian Sea pencilled in at
1.0mB/d

Imle said Uno.crp.nrg would aim the ptpt at Kazakhstan, with vast oil rzv~ in the west of the former Soviet republic, and even Russian producers in western SBR. "Sweet crude landing on the NDN.O is a dollar or two higher than Urals blend landing in the Black Sea," Imle said. He said Uno.crp.nrg was already active in finding and establishing a market for the gas in Pakistan, particularly in power generation. As well as ongoing political uncertainty in AFGan, Uno.crp.nrg faces a battle with another company for rights to the ptpt project -- Argentinean independent Bridas Energy Corp. Bridas is suing Uno.crp.nrg for what it called "tortuous interference" in a plan Bridas developed to xpt TKM nrg.g to PAKan via AFGan

1997no:USA court hearings are pencilled in

It is also unclear how a memorandum signed recently between the Presidents of TKMan, IRN and TRK to transport gas from the Dauletabad field to TRK via IRN would affect the Uno.crp.nrg plan.

 

<>1997:RUS nrg.g [USA DOE webpage] USA DOE estimated that RUS nrg.g production could reach
23.0tcF by 2000

Three nrg.g.ggr~ account for roughly 80% of RUS procution:
Urengoy nrg.g.ggr
Yamburg nrg.g.ggr, and
Orenburg nrg.g.ggr

Production from all of Russia's major gas fields, with the exception of Yamburg, is declining.

Attention is now focused on new fields:
Yamal Peninsula
SXL

Russia hopes now to begin large-scale nrg.g production at
Bovanenkov

2000:Bovanenkov projected annual output levels to reach
3.0bcF/d in 2000.

This output will be targeted at EUR mkt~ via the planned 2,500m YAM-EUR.ptpt, which is anticipated to start-up in 1998 with a throughput of
475mcF/d

YAM-EUR.ptpt = 7 parallel ptpt~ running from Yamal to Frankfurt/Oder, GRMy via BRUS & POL

1996no:RUS & POL inaugurated the first 65m segment of $2.50b, 400m POL segment of YAM-EUR.ptpt

Initial throughput in the line, which is tied into GRMy-based Wintershall's older ptpt~, was
0.058bcF/d

Eventually in 2010, Yamal shipments to Europe are expected to reach more than
5.50bcF/d

The cost of the ptpt could reach $40b.

1997fe28:Additional financing for the project was received on February 28, 1997 when Ggzz.crp agreed to the terms of an 8-year,

$2.50b syndicated loan from [bnk.snd] 19 international banks to be backed by revenues from Gazprom's gas exports to Europe; Wintershall has also provided credits for the project.

Russian gas exports were equal to about 30% of its natural gas production.

Of this amount, about 67% are destined for European markets and the remainder for CIS countries.

Western Europe relies on Russian gas to meet about 25% of its consumption needs.

Even though shipments by Ggzz.crp to CIS countries are relatively small and are partially subsidized, a few countries, EG:UKR BRUS & MOL, have amassed large arrears since 1993

1996:Ggzz.crp estimated that it was owed the equivalent of $10 billion by CIS countries for past gas deliveries to both Russian and CIS customers. Over 90% of Russian gas exports to Europe run through UKR & CZC . However, YAM-EUR.ptpt will by-pass UKR

Ggzz.crp controls more than 95% of Russia's gas production in the country's 100 largest nrg.g.ggr~,
oversees 8 production associations,
owns and operates Russia's 86000m ptpt grid,
runs 26 trding dms~ & mkting joint ventures in 13 EUR stt~, &
controls 20% of the world's natural gas rzv~.

Ggzz.crp currently is undergoing an extensive 5-year rehabilitation of its gas trunkline ptpt system, including ptpt~ and compressor stations.

1997je:YlcB ordered cuts of up to 40% in nrg.g prices for businesses that pay their overdue Ggzz.crp bills in cash by the end of the year. Building on earlier action:

1996fa:Internal Russian estimates placed needed investment at around $12.0b.

1996de:EBRD approved a $225.0m loan as part of a $300m investment program geared towards rehabilitating Ggzz.crp's ptpt network.

1997fe:YlcB adjusted 96oc:dkr. Differentiated gas prices by very broad ggr rgn~ in order to reflect tpt costs (the maximum differential between regions is 10%)

1997ap28:YlcB decree ordered sweeping reforms in the country's natural gas sector under which the gvt retained its 40-percent equity stake in Ggzz.crp indefinitely and strengthened Ggzz.crp's international position and boosted its share price. Ggzz.crp will lose its monopoly right to develop new gas deposits (which instead will be allocated at tenders open to competitors), will offer equal access and competitive rates on its national ptpt network to all producers (giving oil and other companies the opportunity to compete in the gas business), and will be required to ensure transparency of its finances with detailed annual financial reports. Additional decrees were signed on May 13 and May 28 by President Yeltsin substantially increasing the state's role in managing Ggzz.crp.

Several new international agreements were approved in 1997:

1997ja:Ggzz.crp signed a $2.50b project to build the world's deepest underwater natural nrg.g ptpt (about 6,900 feet below the surface) linking RUS & TRKey via BLK.S. GO 997ap

1997ap:RUS & IRN signed an agreement on cooperation in the oil and gas industries whereby Ggzz.crp wld invest directly in joint operations in development of IRNan nrg.g.ggr,
production capacity,
refining,
liquidation, and
tpt of natural gas and associated extraction industries in the PER.G and other areas

1997je:RUS & CHNa signed agreements to create a joint venture for nrg.g exploration in SBR that is expected to result in xpt of almost
1.0tcF/y to CHNa

 

 <>1997je:KZXan awarded Tractabel (BELgium) a 15-year contract to manage its natural gas network. Tractabel has pledged to spend $600m on investment, repair, construction, and planning costs, as well as $100m to build a ptpt in southern Kazakhstan to bypass Kyrgyzstan . Other investment needs include capturing previously flared gas, field processing of natural gas, developing projects that support swap agreements with neighboring states, appraisal work for gas fields located near consuming areas, meter installation at cross-border locations, and environmental rehabilitation and protection.

Kazakhstan contains about
83.0tcF nrg.g, and more than 40% of these are located in the giant Knrg.g.ggr (northwest Kazakhstan), which is an extension of Russia's Orenburg field.

1997, an international consortium signed a $7.0 - $8.0b final production sharing agreement to develop the Knrg.g.ggr for 40 years:
Agip (32.5%, Italy)
BG (32.5%, U.K.)
Tex.crp.nrg (20%, United States)
Luk.crp.nrg (15%, Russia)

Although the Knrg.g.ggr produced 0.050mB/d nrg.p & 67.0bcF nrg.g in 1996 (almost half of the country's total production of natural gas), production was only half of what had been planned, and is far below the field's potential production of 0.20mB/d nrg.p and condensates & 700 - 900bcF/y nrg.g. Development of the field has been hampered because the former Soviet Union intended for all gas to be processed at the nearby Orenburg nrg.g.zvd, and xpt- via ptpt from Russia.

Ggzz.crp originally agreed to take a 15% stake in the consortium in exchange for processing and exporting the gas, it has been unable to reach agreement on the terms of the deal with its partners, and has left the project. Although a workable deal with Ggzz.crp remains the best option for Knrg.g.ggr's development, President Nazerbayev has asked consortium members to develop interim solutions to process and dispose of the gas, as there is no large gas ptpt available outside the Russian system to export the gas.

Fields other than Knrg.g.ggr do not have access to xpt ptpt at all. Kazakhstan's other significant producing areas are the TGZ and Zhanazhol nrg.g.ggr, with the Uritau field expected to eventually become the third largest producing field. The undeveloped offshore areas are also believed to hold large amounts of gas.

These nrg.g.ggr are near the Russian gas ptpt system byt are not currently linked to it Furthermore, the Russian ptpt system may be insufficient. Either the existing Russian gas ptpt system must be expanded, or Kazakhstan will need to develop new routes, EG:the proposed $12.0b, 3800m ptpt that would bring C.ASA nrg.g to CHNa In addition, the mostly sour Kazakh gas will require that additional gasprocessing equipment be built.

In general, the Kazakh gas sector faces a lack of infrastructure, especially ptpt~. Gas producing areas in the west of the country are not connected to consuming areas such as the populous southeast and industrial north and, as a result, Kazakhstan has two separate gas ptpt networks.

Kazakhstan exported its gas production from the west to Russia, and imported three-fourths of its natural gas consumption needs in 1996 from TKMistan , Russia, and Uzbekistan . Kazakgaz was responsible for distribution in the west, while Alaugaz had been responsible for distribution in the southeast.

 

 

<>1997je17:INDIA homepage: nrg.g [ http://w3.meadev.gov.in/economy/infra/p5-ng.htm]

Growth in industrial and commercial sectors together with rise in population has led to increase in nrg demands. With the inadequacy of domestically available nrg supply, government has had to increase spending on imports of {nrg.p} crude oil and oil products. Major imports are from IRN, Qatar, Oman and Russia. India is flanked by nrg.g rich nations with xptable surpluses, and it needs to be examined how best to tpt the nrg.g economically and efficiently to India. Parallelly, the government is intensively promoting exploration of natural nrg.g in India, inviting both foreign and local firms to participate. However, flaring of natural nrg.g continued during 1994-95, at about 11.6% of the total production. Flaring of natural nrg.g takes place due to lack of :
required compression and tptation facilities,
technical requirements of operational safety,
availability of nrg.g from isolated pools which cannot be economically connected to the
tpt network and
non-lifting of nrg.g by consumers etc.

The production of nrg.g in 1994-95 at 19.40bcM , was higher by 5.7% than 1993-94. Today, the lack of power, finance and expertise is compelling the government to seek more power generation projects. Nearly 70 power projects will be in operation by the year 1997. One third of these are based on gas. Natural nrg.g accounts for 10% of the primary nrg demand in India. Gas use has mainly developed in the NE due to the 1980s commissioning of the Hazira-Bijapur-Jagdishpur (HBJ) ptpt that links Bombay High in the south-west to consumer centers in the North. Along the route, fertilizer plants and combined cycle power plants have come up.

In India 80% of nrg.g is utilized in fertilizer and power sectors. The other uses of natural nrg.g are in LPG, furnace oil and sponge iron. Presently, larger volumes of nrg.g are used to produce fertilizer-a sector where nrg.g use is considered most efficient as against power sector.

With government inviting independent power producers, the demand for nrg.g for the gas-fired combined cycle power plants will increase, thereby, affecting the supplies to the fertilizer sector. However, by the year 2000, demand for fertilizer is expected to be met through dedicated offshore plants and power generation is expected to account for 29% of nrg.g use, rising to 36% by 2005.

The total nrg.g availability in India today:
1400 MMCFD [?mcF/d?], which is likely to reach
2100 MMCFD in 2000 and
3000 MMCFD in 2010

The projected gap between demand and domestic production:
3000 MMCFD in 2000
5600 MMCFD in 2010

 

<>1997je:DENMARK [>DNM] Copenhagen|20th World Gas Conference|>Viakhirev,RI, Chairman of the Board, Gasprom, Russia. [Ggzz.crp], delivered keynote address, "THE PERSPECTIVES OF RUSSIAN NATURAL GAS: ROLE AT THE WORLD GAS MARKET" [TXT]

 

*1997je:DENMARK [>DNM] Copenhagen|20th World Gas Conference

THE PERSPECTIVES OF RUSSIAN NATURAL GAS: ROLE AT THE WORLD GAS MARKET
Keynote speech by
R. I. VYAKHIREV [Viakhirev], Chairman of the Board, Gasprom, Russia. [Ggzz.crp]
[SOURCE]

SUMMARY=

Present state of things in nrg.g industry of Russia and perspectives for further development of nrg.g industry in Russia are considered in line with the world nrg industry. Estimation of perspectives for both the existing and new markets for the Russian nrg.g is given. The main attention is paid to the problems of developing the Russian home natural nrg.g market. It is shown that a powerful raw material potential makes it possible to consider nrg.g industry as a support for developing fuel-and-nrg complex of Russia in a long-term perspective.

ToC =
1. World energy production and the role of natural gas
2. The Russian natural-gas market
3. The rules of the natural-gas market
4. Problems faced by Russian natural gas
5. The European natural-gas market
6. East-Asian natural-gas market
    Conclusions

1. The Development of wrl.nrg Production. The Role of Gas

Any attempts at forecasting the development of world nrg production, at setting a rational scope of energy supply or at early preparation of structural, organizational and engineering decisions in the fuel and energy complex should respond adequately the challenge of current issues confronting society. For the coming 20 or 30 years, the major concerns might be:
the ever-growing nsx;
the ever-degrading global enx [wrl; tntn];
the enhancement of the nrg use efficiency and
the emergence of new energy sources and
[the emergence of new] production processes.

[EEE=] Building steadily sustainable development future energy production, we should take into account these diversely-oriented tendencies and meet the demands of the efficiency and safety in energy production, economy and the environment. Inasmuch as the basic population growth within the whole comprehensible perspective would belong to the developing countries, a cardinal and strategic problem of humanity would be to supply them with energy and bridge the gap between their energy supply and that of the developed countries.

Analyzing the evolution of energy production over a greater and trying to define the role of natural nrg.g in it, one should take into account the following features of the energy framework in the world:

[1] the principal modern nrg consumers, i.e. the industrially developed countries, [will continue as such]
[2] [they will enjoy] a stable and [slightly declining] level of energy use, which is primarily due to

[a] nrg-saving policy and
[b] structural transformations in [their ekn~]

[3] new locations and centers of fast-growing energy use are going to emerge: those will be primarily

[a] South-East Asian countries [entering into intense] industrialization and post-industrialization
[b] Latin American countries, also following the same route;
[c] People's Republic of CHNa &
[d] India are going to become major energy consumers within the [next 10y];

[4] a geographical [distances between points of] production and consumption of energy will be retained, but

[a] extensive development of off-shore rzv~ [will ease that problem, as will],
[b] progress in nrg.n production and the
[c] advance in new energy sources and
[d] [advance in new]methods of energy production;

[5] the role of nrg.g in the world energy supply is potentially enormous (Fig. 1), considering

[a] its rzv~ and
[b] favorable environmental properties

[6] [But] the implementation of the potential [will be in competition] with other kinds of fuel and energy:

[a] essentially, with oil and nrg.c,
[b] in future with nrg.c and nrg.n produced by safe reactors, and
[c] later with {nrg.s nrg.z nrg.g} renewable energy sources.

Fig. 1. Structure of the world energy resources, %.

The gist of the competition will be in the customer's choice of preferable energy source on the basis of its consumer properties and price. And while the consumer properties of nrg.g will be basically advantageous as compared with other energy sources, its position in price competition will depend on the potential resolution of a number of fundamental technological and economic issues [in re. competitive price position of nrg.g].

The following ones among these should be regarded as top priority:

[1] cost reduction in production and tpt of gas;
[2] technological advance in traditional domains of nrg.g use,
[3] [?technological advance] in energy production in the first place;
[4] development of new sectors of nrg.g use

[a] (compressed and
[b] liquefied natural nrg.g

[i] for tpt,
[ii] air conditioning,
[iii] methanol production,
[iv] etc.).

Fundamentally novel and reasonably effective technologies should be devised in order to be able to produce from the conventional nrg.g rzv~ that are going to be associated with the prospects of nrg.g industry for 2030-2050 (coalbed methane, tight nrg.g sands, deep gas, nrg.g hydrates rzv~). Fundamental studies and pilot projects along these lines are under way in many countries, and Russia is no exception in that respect. Numerous studies performed by international organizations and national teams of researchers, including those of Russia, make it clear that although energy saving is both essential and significant, further increase in world energy consumption and therefore further rise in energy production are unavoidable, at least for the next 25-30 years. This inference is in complete accordance with the maturing tendency of reducing the gap between the living conditions of population in the developing and developed countries, which is a target for humanity to aim at.

A consistent augmentation of the share of nrg.g in the world energy balance is a longterm tendency. There is every reason to assume that in the foreseeable future the tendency can persevere (Fig. 2). Whether or not nrg.g is going to play the leading role in the structure of world production of primary energy resources will depend not only on the results of its competition with other energy sources but also to a certain extent on the endeavors of the International Gas Union in the development and expansion of nrg.g markets.

Fig.2. World natural nrg.g demand forecast, BCM.

The Russian nrg.g sector, possessing world largest rzv~ of natural nrg.g that can be ptpt- through the well-developed Unified Gas Supply System [Uno.crp.nrg.g.ptpt] connecting Russia with the CIS and European countries and therefore being geopolitically very significant for the Eurasian region (Fig. 3), is objectively called for rendering a thorough strategic impact on the evolution of international energy relations at the turn of the 20th century. In order to support the idea, we can only cite that the Russian nrg.g rzv~ amount to 38% of the world ones while Russia produces 27% of the world gas.

Fig.3. Structure of fuel-and-energy balance of Russia, %.

2. Evaluation of Prospects for the Existing and New Markets for Russian Gas

At the present time, international nrg.g markets are clearly regional. Three major markets...:
Europe
North America
East Asia.

In our opinion, each of them has got a fine potential for its further progress, especially the East-Asian market.

Another two regional markets...
South America
South Asia,
are shaping up. Internationalization of the world economic relations and further scientific and engineering progress concerning nrg.g tpt over very long distances appear to bring about gradual merging between a number of regional nrg.g markets, especially in
Eurasia, where in the course of time the world[‘s] largest [nrg.g market] network ... might take shape.

The Eurasian geopolitical position of Russia gives us a chance to structure our operation with due regard of the unfolding situations at the nrg.g markets both of the
European Community and of the
Asian countries.

These two nrg.g markets, being well-connected with the Russian nrg.g industry, are at totally different stages, and therefore the nature of their further progress is going to be essentially unlike one another.

Russia is one of the most important players at the European nrg.g market. The other regional nrg.g markets are at a considerable distance from the main producing sites of RAO Ggzz.crp, which is a material reason that lessens the chance for the presence of Russian nrg.g at those markets. Nevertheless it can be assumed that in future Russia will play a great role at the Asian nrg.g markets as well, which is related to nrg.g xpt from the nrg.g.ggr in East SBR and Russian Far East to People's Republic of CHNa, Republic of KOR and JPN, as well as to the direct participation of Russia in the development of nrg.g rzv~ in the countries of Central Asia and in projects for nrg.g tptation from that region to Pakistan, India, People's Republic of CHNa and other Asian states.

While the Russian Arctic off-shore nrg.g.ggr are being put into operation, that creates the ground for deliveries of liquefied natural nrg.g to the North-American and South-American markets.

3. On the Improvement of Gas Market Rules

A civilized method of redistributing energy sources between countries is a real achievement of the 20th century. There is every good reason to believe that during the coming decades the volumes of global energy flows [tntn or wrl.nrg] will become even greater, and local and regional energy markets will grow to become transcontinental. In consequence, humanity will have a better and more reliable system of energy supply. And natural nrg.g should play its weighty role. In order to achieve that, not only both economic and engineering problems should be overcome. There is also a need in the expedient transformations of the principal characters playing at the nrg.g markets, i.e. the nrg.g companies themselves, and a certain correction of the basic rules of behavior at the markets. One can observe some dramatic changes at the European nrg.g market. The competition struggle among the major natural nrg.g xpters has aggravated in connection with the processes of liberalization at the European nrg.g market, where there is a clear-cut tendency of the supply exceeding the demand, at least in the short-term and medium-term perspective. Gas industry as a part of the market economy is a very specific sector for which many of the standard approaches are hardly acceptable. Modern comprehension of its status in most countries either has taken shape during the past 10-15 years or has been debated severely until now. The latter is typical for the European nrg.g market as well. We regard the improvement of the nrg.g market rules as matched with the implementation of the European Energy Charter and the associated agreements. The European Community {EEC EUn stt.vs-mkt} countries adhere to a uniform policy of energy security, in accordance with which there is a certain allotment of energy supply set over the suppliers, over the energy sources and over the kinds of generating capacities. The Russian nrg.g sector takes that into account while dealing with the European nrg.g market countries. At the same time we believe that setting an upper potential limit for a supplier should be substantially dependent upon the supplier's reliability and nrg.g industry resources. In the European countries, there is still no uniform model for the structure and operation of the nrg.g sector. Discussions concerning the extent and patterns of nrg.g market liberalization have been going on for many years there.

The points of liberalizing the nrg.g sector are related to the need in involving major financial funds for modern nrg.g tpt systems. The return of the funds is commonly guaranteed by the significant nrg.g rzv~ on the one hand and by prior agreements with customers for deliveries. All that is easier to secure by major integrated companies oftentimes backed by governments than by a would-be consortium of small commercial structures.

((stt&ekn)) Gas projects have always made it imperative for government authorities to be involved in decision-making, because they needed long-term guarantees that were indispensable both for the deliverers and for the customers. Since projects become more sophisticated and costlier, that situation is going to be ever more pressing and, moreover, new forms of intergovernmental relations might be needed to accomplish major transcontinental nrg.g projects. For instance, one of the problems is related to the nrg.g transit tptation rates that might have a crucial impact on transcontinental nrg.g flows. To date the rates are so high that natural nrg.g in Europe may prove to be non-competitive as compared with other fuels. One of the practicable ways to eliminate the danger is to work out jointly a mechanism envisaging a chance for a redistribution of profit between nrg.g suppliers and customers. All of these aspects have to be summarized and pondered upon before taking any final decision. In any case, however, regulation of the Russian nrg.g market is going to advance along the same lines as in the EUn. In the development of the Russian nrg.g market, due consideration is given to the experience of the European countries.

4. The Russian Natural Gas Market and Problems of Its Development

RAO Ggzz.crp has got significantly greater degrees of freedom in the choice of nrg.g markets than during the period of the former Soviet Union.

Currently
66% of nrg.g produced in Russia is consumed by the domestic market,
20% is xpt- to the countries of Central, South-East and West Europe and
14% is xpted to the CIS and Baltic countries (Fig. 4).

Fig.4. Natural nrg.g of Russia. Trends of usage in 1996, %.

Most of the nrg.g (95%) produced and delivered domestically and for xpt is supplied by RAO Ggzz.crp or by its subsidiaries. The Russian internal market is very capacious, and it is still going to expand intensely with the stabilization and elaboration of the economy, the internal prices for natural nrg.g being such that Ggzz.crp's income from nrg.g sales in Russia will be no less than from the sales at foreign markets.

l995:Domestic delivery of nrg.g =
340bcM

nrg production and other energy-consuming sectors prevailed in the structure of nrg.g consumption, and the share of municipal and household supply was less than 20% (Fig.5).

Fig.5. Structure of domestic demand for nrg.g in Russia, BCM.

The high share of power plants in the nrg.g consumption structure can be accounted for by the purpose-oriented governmental policy of nrg.g replacing both nrg.c and {nrg.p} fuel oil, aiming at making the air enx sounder and oil fuels available. That strategy will be retained in future, especially in environmentally unfavorable areas.

2010:Planned nrg.g utilization
365.0-370.0bcM [?] of natural nrg.g for power and heat generation, of which approximately
205.0bcM for power production only.

Along with the increase of sales of gas, RAO Ggzz.crp intends to launch construction of
CCPP (combined cycle power plants)
in nrg-deficient areas, the plants being equipped with nrg.g turbines of small and medium unit capacity. Therefore an important step will be made towards an expansion of RAO Ggzz.crp in the business space and towards further promotion of the competitive energy production market in Russia.

One of the priority objectives held by RAO Ggzz.crp is the further progress of nrg.g distribution network {tpt}, primarily in {gbx vlg} rural and small town areas. In the past, when the basic emphasis in the nrg.g sector was on {tpt} large streams of nrg.g targeted at major customers, network supply to small cities and villages, especially the ones remote from trunk ptpt~, was not given any sufficient attention. The result is that millions of Russian citizens have been unable so far to enjoy the advantages of nrg.g fuel. We are taking measures to correct the current situation. As far as that is concerned, top priority areas are:
North-European part of Russia
South-West SBR
Volga area
Black Soil area
In particular, it is planned to construct nrg.g ptpt~ to supply nrg.g to the cities of
ARX and
Severodvinsk, as well as to the
Murmansk Region and
Altai Territory.

Alongside with the construction of new trunk and distribution nrg.g ptpt~, the plan is to advance intensely the medium and low pressure nrg.g networks. RAO Ggzz.crp is going to be heavily engaged in that. Due to further progress of nrg.g networking and increased provision of housing for the population, an elevated employment of nrg.g for the household and municipal supply is expected.

Estimates reveal that the need in nrg.g for grd and dms needs will increase in 2010 by about 90bcM.

In our opinion, there is every prerequisite needed for an essential broadening of the scope of utilization of natural nrg.g as {nrg.m} motor fuel in Russia. An objective has been set for 2005 to bring the volume of nrg.g used for that purpose to 15.0bcM, which would allow us to cut down the discharge of hazardous substances into the atmosphere by nearly 3.0bcM/y. The last point is very important for big cities.

Forecasts give us grounds to believe that internal nrg.g consumption in Russia is going to rise and, depending on the rate of economic growth and success of vigorous energy-saving policy, reach 35-40% by 2010 as compared with 1995.

Unlike most of the countries, there are practically no long-term contracts for nrg.g deliveries to the internal market in Russia. That removes a number of problems that occurred while the nrg.g market was liberalized in those countries and makes it easier to bring about new forms of its regulation in principle. The processes related to nrg.g market regulation in Russia advance along the same lines as in the European countries. The structure and methods of operation at RAO Ggzz.crp and other Russian gas-supplying companies are subject to change accordingly. Relatively recently, a specialized subsidiary company was set up within RAO Ggzz.crp to carry out marketing and sales operations at the domestic market; it has to perform centralized payment settlement with nrg.g consumers. The subsidiary purchases nrg.g from gas-producing enterprises, including those beyond RAO Ggzz.crp, and pays for the services of nrg.g tpting companies of the
Society for Gas Transportation over the
Russian Unified Gas Supply System (UGSS).

According to Russian law, nrg.g exploration and production must be carried out in compliance with licenses that are granted on a competition basis. Along with Ggzz.crp, some other companies have got those licenses as well.

tptation of nrg.g over the Russian UGSS has been recognized as a natural monopoly. In consequence, the government is going to regulate the tariffs for nrg.g tptation over the UGSS rather than prices for gas. At the same time, independent nrg.g producers shall enjoy the right of access to the nrg.g tptation network belonging to RAO Ggzz.crp. That creates the prerequisites necessary to preserve intact the existing nrg.g tptation system, which is of paramount importance in providing high level of reliability in the supply of nrg.g to customers. In the long run, all these measures will make it possible both to liberalize the Russian nrg.g market and to reduce production costs in RAO Ggzz.crp, therefore improving its competitiveness at both the internal and external markets.

((leaks;wastage ecx)) One should underscore the significance of employing the existing potential of energy-saving in Russia; estimates reveal that it amounts to 40-45% of the total volume of energy consumption to date. It goes without saying that there are considerable rzv~ in saving natural nrg.g along the entire technological chain from its production point to the end user.

The potential of nrg.g saving can be estimated at 100-110bcM, which amounts to 1/4 of the total nrg.g consumption in the country.

The involvement of the gas-saving rzv~ will allow us to be more conservative in the rate of development of new nrg.g.ggr, while meeting the internal nrg.g demand in full, and will give us a chance to have additional resources for xpt.

The extensive natural nrg.g rzv~ in place and the concentration of rzv~ in major nrg.g.ggr make it possible to regard the nrg.g sector as the backbone of further progress of the fuel and energy complex in Russia in a long-temm perspective.

5. The European Gas Market

During the nearest 15-20 years, the markets of the European countries, including the European CIS and Baltic countries (that turned from being our internal markets into external ones in the process of well-known transformations), will stay being the most important and predictable Russian xpt markets.

5.1 The CIS and Baltic Gas Markets

Russian nrg.g is practically the primary nrg.g supply source for the Ukraine, Belarus and Moldova, as well as for the Baltic countries. As to the Caucasian CIS countries, nrg.g is supplied there due to redistribution of TKMian gas. This situation is going to be the same during the years ahead. The largest Russian nrg.g importers at the CIS markets are the Ukraine and Belarus (Fig. 6). Russian nrg.g is supplied to those countries, as well as to Moldova and the Baltic states, through the Unified Gas Supply System constructed earlier in the USSR. We believe that the current level of nrg.g supply to the CIS and Baltic countries will be rising while they are going to overcome gradually their economic crisis. RAO Ggzz.crp estimates show that the nrg.g market there may increase for Russian nrg.g by 10-15 BCM in the year 2000 and by 20-25 BCM in 2010.

Fig.6. xpt of nrg.g from Russia to the CIS and Baltic countries in 1996, BCM.

Apart from supply of natural nrg.g to the CIS and Baltic countries, cooperation with them is carried out by setting up mutually beneficial joint ventures and international joint-stock companies, by joint employment of labor and logistical resources while constructing industrial facilities, socially-oriented units and the infrastructure of the gas-supply system, including, in particular, underground nrg.g storages.

5.2 The Gas Market of Central, West and South-East Europe

Russia has been supplying natural nrg.g to the European countries for over 25 years (Fig. 7).

Fig.7. xpt of nrg.g from Russia beyond the borders of the CIS and Baltic countries in 1996, BCM.

In the early l990s, the market for Russian nrg.g in the countries of Central and East Europe dropped somewhat because of the economic recession. During the recent years, nrg.g consumption has started to grow. In our opinion, while those countries are going to overcome the recession, their demand for imported gas, despite the intended measures for reduction of the energy intensity of the gross domestic product, may increase by 30-40 BCM by 2010 as compared with 1995. To date, the source of nrg.g supply to the West-European states is their own nrg.g production. The existing nrg.g shortage is covered by the import from Russia and Algeria. This tendency will be retained in future. We are aware of the fact that nrg.g from Middle East may start competing with Russian nrg.g in the region within the next 1 0- 15 years. Nevertheless, RAO Ggzz.crp expects the Russian nrg.g to win the competition so that its supply to that market will expand.

Construction of the Yamal-Europe system of trunk ptpt~ has been started precisely in order to support the planned growth of xpt deliveries of Russian nrg.g to Europe and to raise their reliability and flexibility. Implementation of the Yamal-Europe project has been scheduled in such a way that there would be a chance to respond in the most flexible and economically efficient manner to the possible shifts in the nrg.g market both in Russia and in other countries. Construction of the South-European transit ptpt envisages increasing the growth and reliability of Russian natural nrg.g deliveries to Italy and of additional deliveries to Hungary, Slovenia and Croatia.

Reconstruction of the existing transit nrg.g tptation capacities and construction of new ones are envisaged in ROM, BUL, TRKey, GRKe and a number of other countries in order to cover the demand for Russian nrg.g in the South-East Europe (including Turkey). According to endorsed intergovernmental agreements, the overall nrg.g delivery to the region will increase from
19.50bcM in 1995 to
58.00bcM in 2010.

The objective of the North-European project that is currently under consideration is to provide nrg.g supply to the North-European states by tpting it from Russia to West Europe via Finland, Sweden and Denmark. Measures will be taken to plan, finance and construct the North-European ptpt if that proves to be economically feasible.

The scale of natural nrg.g xpt from Russia to Europe will be influenced by the following factors:
competition between nrg.g and oil products, as well as other energy sources;
competition between various nrg.g suppliers.

Both kinds of competition for the Russian nrg.g to overcome will be determined by the prices for energy sources. We expect that Russian gas, in terms of pricing and delivery reliability, will turn to be better for the European customers than nrg.g from other regions of the world (i.e. IRNian, Middle-East and Nigerian liquefied gas). In any case, we are ready for such competition.

During the latest years, RAO Ggzz.crp has extended significantly its activities abroad in nrg.g construction, primarily for tptation of natural gas. RAO Ggzz.crp takes part in implementation of a number of major nrg.g energy projects in the CIS and European countries and in the establishment of joint ventures (including those in Poland, Germany, Italy and other countries). Implementation of those projects, along with the expected good commercial results, will allow us to strengthen our business cooperation and improve the political climate in the European continent.

Casting a glance beyond the year 2020, we can expect the establishment of new markets, including those for Russian gas. Primarily, this is related to the expected growth of demand for nrg.g in Spain, Portugal, Greece and some other West-European countries. At the same time, the growth of expenditures for the development of new nrg.g.ggr in remote and not easily accessible areas, as well as high nrg.g tptation tariffs cause RAO Ggzz.crp to be prudent in dealing with the development of new markets and with increased nrg.g deliveries. That is why the decision concerning each project will be taken on the basis of its economic efficiency. We intend to develop cooperation with any partners only if there is reciprocal interest and mutual benefit.

6. The East-Asian Gas Market

The demand for nrg.g in the East-Asian countries (principally in JPN, Republic of KOR and in the CHNese People's Republic) is due above all to the environmental reasons, in particular, due to their need to increase their energy consumption without further technogenic impact on the environment.

Gas markets in East-Asian countries have not yet been developed, which can be accounted for by three fundamental factors: by lack of local nrg.g rzv~, by high expenses for its tptation from other countries and regions and by the cost of setting up local infrastructure. The prospects for growing nrg.g consumption will be determined there mostly by the potential for its supply at competitive prices and with the appropriate degree of reliability of deliveries. As soon as nrg.g becomes more accessible for its utilization, the demand may rise very rapidly. It will be especially significant in the industrial sector and in electric energy production, where there are many potential major customers. Estimates show that demand for imported nrg.g in the region may increase after 2005 to reach 180-200 BCM per year.

In the nearest years, the demand of the East-Asian countries for nrg.g will be met first of all by the import of liquefied natural nrg.g (LNG). After 2005-2007 they appear to need new sources of gas. Russia may become one of such sources. At present we are examining several projects envisaging deliveries of Russian nrg.g to East-Asian countries. A new nrg.g production center is intended to be built beyond the year 2000 in the Irkutsk Region, from where natural nrg.g will be transmitted to the city of Irkutsk. Later, on the basis of that center and the nrg.g.ggr of the neighboring South-West areas of the Sakha Republic, it will be possible to set up a major nrg.g production base there and link it by trunk ptpt~ not only to Southern areas of East SBR and Far East of Russia, but also to People's Republic of CHNa, SKOR, Republic of KOR and very likely to JPN.

An interest to the development of that nrg.g production base is now revealed by the business communities of the East-Asian countries. Preliminary feasibility estimates substantiate the construction of a nrg.g ptpt from East SBR via Mongolia to the central areas of People's Republic of CHNa and further to its maritime area. The available resources make it possible to send nrg.g to the Republic of KOR, and the republic has already given its consent to join the project. Major JPNese companies also revealed their interest in the implementation of that nrg.g project. The next issues are to prepare a detailed feasibility study in accordance with international requirements and to coordinate a project financing scheme on that basis. Russia hopes that financing of the project that opens up an era of constructing cross-boundary ptpt systems in Asia can be organized employing Asian sources. Formidable financial resources are well-known to be available in a number of Asian countries, and the resources are expected to be invested efficiently.

Russian gasmen, with their many years of experience in exploration, production, processing and tptation of nrg.g in very diverse natural and climatic settings, are ready to cooperate with every interested country and company in increasing the efficiency of utilizing that most progressive kind of fuel.

In the nearest years, the Eastern-most nrg.g base of Russia will be shaped up at the SXL Island shelf, where in 2010 it is planned to produce no less than 20 BCM of gas, half of which is going to be supplied to customers in the SXL Region, XBR and Primorsky Territories while the other half will be xpted.

In a more remote perspective, over the year 2010, the nrg.g streams originating in the West (in the North of Irkutsk Region or in the South-West of the Sakha Republic) and in the East (in the SXL Island shelf) can become the basis of the unified nrg.g tptation system of East Russia. It will not only supply nrg.g to the vast territory from Irkutsk to Vladivostok, but also supply up to 50 BCM of nrg.g annually to the Asian-Pacific countries.

A new stage in constructing the Eurasian system of transcontinental nrg.g ptpt~, unprecedented in terms of its length and throughput, will be started by laying nrg.g trunk ptpt~ in the South of East SBR from the polar nrg.g.ggr of the Tyumen Region, thus connecting the nrg.g ptpt systems of the East and West of Russia.

Conclusion

There is every prerequisite needed to provide for the steady progress of the nrg.g sector in Russia for many years ahead: abundant rzv~, capacious markets, a vast economic, research and engineering potential and reliable long-term contracts with dozens of countries.

RAO Ggzz.crp, being aware of the ever-increasing significance of natural nrg.g in the world economy, is open for mutually beneficial cooperation with every country, is ready to go on taking an active part in solving the problems of development of the world nrg.g market and in strengthening business contacts with the leading nrg.g companies, aiming at providing energy security of all the countries of the Eurasian region, including Russia.

WebMaster bjo 07/14/97 10:36

 

<>1997je23:29;Saint Petersburg Times [http://www.spb.su:8080/times/272-273/gazprom.html]

“Ggzz.crp Sets Its Sights on the World” By Gary Peach

SOMETIMES it is easy to forget how great Ggzz.crp truly is. The razor-edged barrage of skepticism, criticism and scandal that has rained down almost continuously upon the company over the past few weeks has affected nearly everyone's perception of this otherwise amazing organization.

But for all who were listening in to speeches at the World Gas Conference last week in Copenhagen, CEO Rem Vyakhirev left no possible doubt that Ggzz.crp is headed straight toward the Olympus of the world's largest corporations.

The thrust of Vyakhirev's speech was that Ggzz.crp is prepared to make the necessary steps to meet rising demand for natural nrg.g not only in Europe, but in Asia as well.

And it doesn't stop there: Vyakhirev has his sights on North and South America.

"When the Russian Arctic offshore nrg.g.ggr are in operation," Vyakhirev said, "that creates the ground for liquefied natural nrg.g [to be shipped] to the North American and South American markets, too.

" With an estimated 33% of the world's nrg.g rzv~ concentrated in the hands of one company, Ggzz.crp has the resources to meet the challenge.

That is why, when considering the strengths and weaknesses of Ggzz.crp, one should just recall the dynamics of the world nrg.g industry.

As a cheaper, less harmful fossil fuel, natural nrg.g is enjoying increasing demand worldwide.

In 1995, nrg.g consumption in Western Europe increased by nearly 5%, and reached 377 bcM . Imports increased by 10%. And Ggzz.crp was there every step of the way, supplying one-third of total consumption in the market.

Keeping in mind that Western European demand will grow by about 33% by 2010, and imports will grow to 50% to 60% of consumption needs, Ggzz.crp begins to look like a unspoiled diamond mine.

{nrg.p.nvy ptpt} Regarding Asia, Vyakhirev said demand there will increase by an estimated 2.6% a year, which in a large part will be met by shipping liquefied nrg.g from the Middle East, Australia and Indonesia.

But delivering nrg.g by ship is expensive and uncompetitive compared to piping it, and Vyakhirev believes it would be advantageous to develop nrg.g.ggr in Southern Russia and tpt it by ptpt to CHNa, KOR and other importers.

Granted, Ggzz.crp will have competition in these markets, but there are only a handful of countries that will be in a position to handle the world's rapidly growing needs for gas.

On the European sub-continent, the chief competitor is NOR, and the North African neighbors LBY and Algeria can provide alternative sources.

Still, Europe possesses only 5% of world nrg.g rzv~, and Africa 7%.

If we look back at Asia, Australia also has 7% of world rzv~, and the Middle East has about as much as Russia does.

However, getting the Middle Eastern countries to agree on anything, much less constructing a tntn ptpt system to tpt nrg.g to a populous and emerging Asia, is well-nigh impossible.

For exactly these reasons, Vyakhirev has a vision of a unified nrg.g system in Russia supplying this growing world demand for inexpensive natural gas.

In fact, Vyakhirev envisions the great Eurasia land mass connected by a string of awesome ptpt~ that stretch from CHNa to Ireland and from JPN to Spain - a powerful system of arteries with the heart pumping straight out of Western SBR.

As one can see, the prospects look superb.

In fact, once the significance of all these long-term strategies start to sink in, one definitely starts to get an itch for Ggzz.crp stock. (Buy now, and watch it climb over the next 15 years, one is inclined to think.)

But the markets are sensitive to perceptions and short-term results, the two main factors behind Ggzz.crp's stock slump on the home front.

As of June 13, the stock was at $0.57, its lowest mark in about three months, due in large part to a lack of orders from foreign investors, translating into a market capitalization of $13.6 billion.

Nevertheless, Boris Nemtsov is sanguine: He believes that Ggzz.crp's market cap will grow to $100 billion, which is six times its current level.

This kind of market cap, by the way, would put Ggzz.crp in the Top 10 most capitalized companies in the world according to the Financial Times, ahead of such classics as AT&T, Microsoft and Toyota. Ggzz.crp's current ranking is roughly in the 220s.

In the short term, Ggzz.crp's commitments to restructuring and paying its debts to the government will be the catalyst to sparking a rebound.

On the other hand, the world of investors in Russia is still too small to create the kind of price growth Nemtsov and company officials like to rave about.

However, the company may soon announce some preliminary results of its first sweeping rzv~ audit, which will finally give us an idea of what kind of assets this unequaled company has in the ground.

Ggzz.crp officials have already promised that the results will be good, which will make it all the harder for us not to get a slice of the enormous Ggzz.crp pie.

Gary Peach is the editor of the weekly newsletter Capital Markets Russia.

 

<>1997je21:Press Conference by Spokesman for the Delegation of JPN Hiroshi Hashimoto
The Leaders' Working Dinner [G-7 G-8]
Date: June 21, 1997
Time: 00:30-01:00
Location: Colorado Convention Center, Meeting Room C-201/205

Major Topics
I. Introduction of speaker and briefing status
II. Proposal to send a Special Envoy to Cambodia
III. JPN-Russia relationship

[…]

Q: You talked about the fact that now JPN and Russia have a different relationship than they did before. You still have a border problem. Do you feel that the breakup of the Soviet Union has helped JPN move closer to Russia? In other words, when the Soviet Union was in power, did they feel that was something that was never going to be taken care of, but now that it is broken down into just Russia that you have to deal with, there is a great possibility of handling that?

A: Basically, the territorial issues should be solved among the parties directly concerned. In this sense it is natural that Russia and JPN will directly engage on this issue. At the same time, Mr. Hashimoto repeatedly asked for cooperation from the other countries on this. Incidently, Mr. Hashimoto and Mr. Yeltsin had a very good talk this morning, and we hope to make progress on this territorial issue. At the same time, we are very happy to have Mr. Yeltsin at the Summit. As I told you, the Prime Minister welcomed the participation in the Summit. We would like to expand the relationship with Russia, both bilaterally and at international fora, such as this Summit. Therefore, what we would like to do is expand our relations in many fields and through the widening of our relationship we would like to make progress on the territorial issue as well.

Q: Is there a point of with unilateral trade now going on with Russia?

A: For example, in comparison with our trade with CHNa, the portion of our trade with Russia is much less. But we would like to deepen not only the trade relationship, but also other type of economic relations, such as the increase of JPN's direct investments in Russia. Very recently, the First Deputy Prime Minister, Mr. Nemtsov, visited JPN and he proposed concrete measures to deepen economic relations with JPN, which was highly appreciative. This subject was touched by Mr. Hashimoto and Mr. Yeltsin this morning too. By doing so, now we can hope that we can develop trade and economic relations with Russia. At the same time, I would like to stress that while we are deepening our economic and trade relationships, we would also like to deepen our political relationship, conducting high-level policy dialogue including security dialogue. At the same time, our eventual aim is to fully normalize the bilateral relationship between the two countries through solving the territorial issue and signing a peace treaty. Thank you very much for your cooperation

 

<>1997je22:CHNa, Russia Seen Signing Deal on nrg.g ptpt NEW
BEIJING -- CHNa and Russia are expected to sign an agreement this month on a multi-billion dollar project that could exploit SBRn natural nrg.g to meet CHNa's growing demand for energy, Russian diplomats said on Thursday.

They described the long-awaited accord as a "framework agreement" that would be signed during the visit to Beijing this month by Russian Prime Minister Victor Chernomyrdin.

<>"The specifics of the project probably will not be part of this agreement," said a Russian diplomat.

CHNa once was a net oil xpter but its rapid economic growth has fueled demand for energy.

CHNese officials estimate oil imports could reach an annual 50 mT by the year 2000.

The Sino-Russian pact would call for cooperation in development of an Irkutsk natural nrg.g field and the construction of a ptpt through Mongolia to eastern CHNa.

The final preparations for the accord are expected to be discussed during the meetings of the Sino-Russian joint commission on economics, science and technology.

Chernomyrdin will meet his CHNese counterpart Li Peng on June 27 after a stopover in Shenzhen, near the British territory of Hong Kong.

He is expected to be accompanied by a delegation from Ggzz.crp, the Russian natural nrg.g monopoly.

Russian sources in Beijing said, however, there was no agreement on financing for the project, which would stretch into the next century.

SKORn and JPNese companies have expressed interest in providing financing but they were insisting participation be tied to the use of their own equipment.

Russia, however, was eager to use as much of its own equipment as possible, the sources said.

Relations between CHNa and Russia have been gradually improving since 1989 when the two sides formally mended ties strained since the Sino-Soviet split of the 1960s.

In April, CHNese President Jiang Zemin visited Moscow where he and Russian President Boris Yeltsin signed a treaty on troop reductions along the Sino-Russian border.

In a clear reference to the USA, the two leaders pledged to oppose domination by any one country in the post-Cold War era.

Russia and CHNa have also said they want to see an improvement in economic ties matching gains on the political front.

Beijing has said trade could reach $8 billion to $10 billion this year and it hopes the total could reach $20 billion by 2000. (Reuters)

 

<>1997jy01:CHN RUS agreement:
BEIJING (AP) - China and Russia signed a multibillion-dollar oil and natural gas deal Friday, as well as an agreement easing railroad travel between the two countries.

The agreements, part of a series of trade-boosting measures, are the high point of a visit by Russian Prime Minister Viktor Chernomyrdin, who arrived Thursday.

They were reported by state television, which did not give details. Chinese and Russian officials wouldn't discuss the oil and natural gas deal with Western reporters.

But Russia's Interfax news agency said the gas deal was worth $4 billion to $5 billion and calls for Russia to supply 26 billion to 39 billion cubic yards of gas annually to China. It said a ptpt would be built to carry natural gas to China from the Irkutsk region in western SBR.

The report did not mention oil. But foreign news reports have valued the sale of Russian oil and natural gas to China at as much as $10 billion.

In another agreement Friday, China agreed to allow Russian trains onto its territory to simplify and speed up shipping between the two countries.

Chinese Foreign Ministry spokesman Cui Tiankai said Thursday the agreements were intended to increase annual trade between the countries to $20 billion by 2000, up from about $7 billion last year.

 

<>1997jy:GRZ|The Georgian International Gas company, incorporated & will spend up to $500 million to upgrade ptpt~ that will eventually carry
300 bcf/year of gas.

As it did with oil, GRZ is positioning itself as a transit point for gas shipments. It has agreed to a natural gas ptpt Ato be built across its territory that will bring Russian gas to ARM and TRK

Part of this gas will go to Georgia for payment.

GRZ has small gas resources of its own, although it has yet to develop these resources. Georgia must import its natural gas; however, its only suppliers, Russia and TKMistan, cut off gas supplies in 1997 for lack of payment. Gas supplies from TKMistan had been received via a North Caucasus-Transcaucasian ptpt through Russia. Georgia's gas imports had been interrupted several times before because of civil strife and the country's inability to pay. On March 3, 1995, bombs blew up the ptpt delivering gas through Georgia to Armenia. Georgia's gas imports had been used mainly by the Rustavi steel mill and the Tbilisi power station.

 

 <>1997jy11:Yeltsin radio broadcast re.study & practical experience abroad for ca.5000 talented young RUS bznen. 97jy24:Hashimoto response [GO 5000]

<>1997jy24: Address by Prime Minister Ryutaro Hashimoto to the JPN Association of Corporate Executives

Provisional Translation [http://www.kantei.go.jp/foreign/0731douyukai.html]

Thank you for giving me this opportunity again to address you today at this informal discussion group of the JPN Association of Corporate Executives. I recall speaking here last year on structural reform in our country. Today, I would like to draw your attention to how our nation s foreign policy should be shaped, focusing especially on our foreign policy toward Russia, and also on our relations with CHNa and the "Silk Road" region.

The State of the World

May I begin with my perceptions of the current state of the world so that everyone can fully grasp why I have decided to speak today about such a topic.

As many have already stated, we are now living in the post-Cold War era. This era is most notable for the fact that the military confrontation between the USA and the Soviet Union has come to an end, and the ideological conflict between liberalism and communism has concluded. The disappearance of communism as a goal gives an opportunity to steer many countries toward a liberal, free-market economy in a broad sense, although the specific path taken and the rate of progress achieved by each country vary. For example, and I will elaborate on this later, CHNa has opted for a socialist market-economy path. Furthermore, with the end of the Cold War, the Soviet Union collapsed, bringing many new countries into existence. As a result, a new task has been to achieve political and economic stability in those countries and to create a new international order encompassing surrounding countries.

Furthermore, we are now in the age of the so-called borderless society. We could not even imagine the evolution of an international economic community some time ago; economic activities now go beyond national borders and corporations have come to select the countries in which they operate. On the one hand, the globalization of economic activities [tntn.ekn], by enhancing interdependence between countries and regions, has created a situation in which problems can no longer be solved easily. On the other hand, by expanding the potential loss resulting from a cut-off of exchanges with partners, such globalization [tntnation] has the potential to contribute to maintaining peace. A long time ago, Charles Louis de Secondat Montesquieu said that peace is the natural result of commerce and all unions are based on mutual necessity. The expansion of such interdependence was limited to the countries of the former Western bloc during the Cold War. However, as I said earlier, the end of the Cold War has created the possibility of expanding this in one stroke to encompass other countries, including the nations of the former Soviet Union.

Reaffirmation of the JPN-USA Security Arrangements

What is it, then, that JPN should do, given this state of affairs?

As you all know, since the establishment of my administration, I have, more than anything else, devoted myself to reaffirming the significance of the JPN-USA security relationship. There have been times when, both in JPN and the USA, people have questioned whether the JPN-USA security arrangements were still necessary in this post-Cold War era. The end of the Cold War did not, unfortunately, signify an end to all international conflicts. Moreover, I have been keenly feeling that it is the JPN-USA security arrangements which provide a sense of security to the countries of the Asia-Pacific region from my conversations with leaders from other parts of Asia. Therefore, while tackling the difficult issue of USA military bases in Okinawa, I have been striving to reaffirm the significance of the JPN-USA security arrangements. Of course, this issue has by no means been fully resolved. As for the so-called Memoranda of May 15, the part which was not made public at the last occasion will be handed to the Okinawa Prefecture tomorrow. I believe, however, that we have made headway, through the efforts in compiling the JPN-USA Joint Declaration on Security issued by President Clinton and myself in April of last year and through the review work of the Guidelines for JPN-USA Defense Cooperation on which the Interim Report was issued in last June.

The basic objective of JPN s foreign policy is to maintain the peace and prosperity of the Asia-Pacific region. In that sense, maintenance of the JPN-USA security arrangements, as I have just described, and the creation of frameworks in this region through such fora as the ASEAN Regional Forum and Asia-Pacific Economic Cooperation can be characterized as creating a platform to stage JPN s basic foreign policy.

However, I believe that amidst the sweeping changes in international relations resulting from the end of the Cold War, the foreign policy of our nation has come to an important period in which we must greatly push to enlarge the horizon of our foreign policy toward the Asia-Pacific region as we forge a new diplomatic perspective. I prefer to call this perspective Eurasian diplomacy.

Enthusiastically Developing a Eurasian Diplomacy

I am sure that you are all aware that this summer, a model for a new security order spanning from the Atlantic Ocean across Europe was agreed upon between the nations of Europe and North America and Russia, and the North Atlantic Treaty Organization has reemerged in a new form. Indeed, we have seen the clear emergence of one part of the post-Cold War international political and economic structure centering on Europe, which, in the economic sector, had already come into existence in a new shape in the post-Cold War era through the Maastricht Treaty.

I have carefully watched this new structure, stemming from the USA, across the Atlantic Ocean, through Europe and over the former Soviet Union, to reach the Pacific Ocean as a vast region which takes on the characteristics of a Eurasian diplomacy viewed from the Atlantic." It was in this context that before the Denver Summit the leaders of European countries and North America were interested in how JPN would react to the idea of having a Summit of the Eight.

At such an historical period of transition, have we not reached a time when we must introduce a new dynamism into our nation s foreign policy by forging a perspective of a Eurasian diplomacy viewed from the Pacific"? As we look forth beyond JPN, out across a huge continent, this perspective which now emanates from within us spans the Russian Federation, CHNa and the Silk Road region, encompassing the Central Asian Republics of the former Soviet Union and the nations of the Caucasus region.

As I stated earlier, one of the traits of the post-Cold War era was the birth of many states, beginning with the Russian Federation, as a result of the collapse of the Soviet Union. These countries have encountered various difficulties as they basically seek to shift to democracy and a market-economy system. The Russian Federation has experienced the birth pains of democratization and transition to a market economy, the lack of an effective organization governing its vast landmass, the downward spiraling of productivity and other great hardships in dealing with the dark legacies of the Cold War era, symbolized in the challenge of dismantling nuclear weapons. Still, from out of that process, in both the political system and economic structure, and in the pursuit of honor and dignity as a nation, we have seen the slow but certain birth of a new Russia. It was from that perspective that the USA and Europe have made a diplomatic decision to expand NATO, as described earlier, and to have a Summit of the Eight at this year s Denver Summit.

Turning our eyes to CHNa, we have seen it take the open and reform policy under the slogan of socialist market economy. Although CHNa has achieved high economic growth, in the transition to a market economy, it faces many challenges, including reform of state-run enterprises and regional disparity. In addition, it holds issues which must be dealt with in the environment and energy sector. I firmly believe that participation by CHNa in international frameworks and strengthening of its status as a constructive partner in the international community will stably advance openness and reform in CHNa and, is therefore indispensable for the stability and prosperity of the Asian region. There are some difficult issues in JPN s foreign policy toward the Russian Federation, such as the Northern Territories issue, and JPN has certain issues in its foreign policy toward CHNa which arise due to its location as a neighboring country. However, the developments in these two great powers, Russia and CHNa, now hold the key to the formation of an international order. One might even go so far as to say that the focus of world diplomacy has shifted from an axis of the Atlantic Ocean and Europe poised on conflict between the USA and the Soviet Union to an axis spanning the Eurasian landmass encompassing many nations, small and large. Hence, just as JPN has long since had to stress to the USA the legitimacy of our policy of active engagement in CHNa, I believe that it is time to strive even harder to build even more constructive relations with Russia and with CHNa. Many have already pointed out that CHNa and Russia have broken away from a relationship of conflict and are now coming closer together in the economic and other sectors. Take, for example, the energy sector, in which the way that CHNa, which is rapidly becoming an energy importer in order to keep up with its rapid pace of economic growth, develops its relationship with Russia, which views energy development as the trigger which will revitalize its own economy, will have a tremendous impact on the energy situation in Asia and indeed, in the entire world, as well as on the global economy [tntn.ekn] as a whole.

Furthermore, in this post-Cold War era, the Central Asian Republics and nations of the Caucasus region which have come into existence in this vast area, which we may call the Silk Road region, are making great efforts to establish affluent and prosperous domestic systems under a new political and economic structure and to forge peaceful and stable external relations with their neighboring countries. Furthermore, the rich oil and natural nrg.g resources in the CSP.S
 region are having a steadily expanding influence on the world energy supply. In addition, these countries have great potential to serve as bridges, offering distribution routes within the Eurasian region. Fortunately, these countries have great expectations of JPN as an Asian country, and at the same time, JPN has deep-rooted nostalgia for this region stemming from the glory of the days of the Silk Road. Indeed, there already exists a solid foundation upon which to build firm relations with these countries as friendly states.

Positive assistance by JPN for the nation-building efforts of these countries will most certainly have a constructive significance, not only for these newly independent states, but also for the peace and prosperity of Russia, CHNa and the Islamic states, and I am certain that it will expand the frontier of JPNese foreign policy to the Eurasian region at the dawn of the 21st century. It is from this perspective that I would like to talk to you about how we should shape our foreign policies, centering on our policies toward the Russian Federation, followed by our policies toward CHNa and our policies toward the Silk Road region.

Relations with the Russian Federation

After the Second World War, the international community experienced a series of trials and errors to create a new order. However, among the interrelationships linking the USA, CHNa, JPN and Russia, nations which exert an important influence on the peace and stability of the Asia-Pacific region, it cannot be denied that the JPN-Russia relationship has lagged behind. While it is true that there have been diverse historical developments between the two countries, it would not be good for relations between neighbors such as JPN and Russia to remain at the current level, either in terms of the interests of JPN and Russia or the Asia- Pacific region overall. Improvement in this bilateral relationship is without doubt one of the most important issues facing both of our governments as we approach the 21st century. Last month, at the Denver Summit of the Eight, I told President Boris Yeltsin directly that I think that we must improve the JPN-Russia relations with a view to creating new cooperation, to which the president responded reassuringly, Indeed we should.

What, then, are the principles which should guide us in improving JPN-Russia relations? I would like to touch on three principles today.

First of all is the principle of trust. At the time of the negotiations for the 1855 JPN-Russia Treaty of Commerce, Navigation and Delimitation, the Russian vessel Diana, on which the Russian delegation, whose head was Commodore Putyatin, was on board, sank in an earthquake-generated tsunami. A film featuring this process has recently been produced, and I am pleased with this in that we can be reassured of friendship between JPN and Russia. At the time our nations were in the throes of grave negotiations aimed at securing our respective interests. Still, we put aside our differences and cooperated to build a new boat for the Russians. I believe that this story shows that in relations among states as well, ultimately, unless the people on both sides of the table truly trust each other, there can be no real progress. I have tremendous respect for the achievements which President Yeltsin has made in overcoming the many serious difficulties which have been faced in the grand reform through which the former Soviet Union gave birth to Russia and in the process of undertaking the great and historic task of reform toward democracy and a market economy. In my talks with President Yeltsin at the Denver Summit of the Eight, which was the second occasion for us, we deepened our personal friendship and I could sense in our discussions President Yeltsin s as a human being. It was in such an atmosphere that I proposed to President Yeltsin that we seek the possibility of meeting again over a weekend before the end of the year in a casual manner, should he have such an occasion as to travel to the Russian Far East. According to recent reports, President Yeltsin has stated that he hopes to meet with me soon and I sincerely look forward to again meeting the president and to further deepening the friendship and trust which we share.

The second principle in seeking to advance JPN-Russia relations is mutual benefit. Given our geographic position as neighbors and the great influence we both wield, it is certain that there will be many cases in which we must coordinate our interests. At such times, an approach through which one side gains, unilaterally creating both a "winner" and a "loser", can in no way yield a true resolution. In considering this point I should like to recall the wisdom of President Yeltsin s oft-emphasized statement that in the process of concluding the Cold War between East and West there were neither winners nor losers.

The third principle which I would like to speak of is that of maintaining a long-term perspective. Specifically, improvements in the JPN-Russia relationship must aim to create a sound foundation for the 21st century so that in that century and the following centuries to come, our children and our children s children can inherit it and build further upon it. Indeed, if we are to achieve that, we must seriously consider the role of our generation and consider what type of bilateral relations our governments and our peoples should shape to build our legacy to our children and grandchildren.

The Northern Territories Issue

Needless to say, our objective is to improve the overall relations between JPN and Russia, keeping these three principles in mind, and thereby create a relationship with which our two countries can be delighted, spanning a massive continent from the Asia-Pacific across to the western limits of the Eurasian landmass.

In order to achieve this goal, we must improve our relations across a broad spectrum. First of all, I would like to talk about the issue of concluding a peace treaty by resolving the Northern Territories issue, which is the most difficult task persisting throughout the more than half-century since the end of the war. As a result of long years of efforts made by many people concerned, the best foundation exists in the form of the TKO Declaration, agreed upon between us at the time of the visit to JPN by President Yeltsin in October 1993. At the Denver Summit, President Yeltsin and I shared the view that the TKO Declaration must be steadily implemented, and I believe that indeed, this very issue is the one that can only be overcome through the three principles I mentioned earlier.

First of all, I would name the Framework Negotiations concerning JPNese Fishing Vessels Operating in the Waters near the Four Northern Islands as an example that the principle of trust has moved us forward even in the most difficult issue. The parties to this negotiation have held direct and unreserved discussions during these three years and have discussed difficult issues head-on, creating a substantial level of trust in each other which has fostered a positive environment absent from previous negotiations.

Secondly, I firmly believe that no resolution of the Northern Territories issue can be achieved in a manner which creates a winner on one side and a loser on the other side. It took fifty years for our countries to truly come to understand this principle, which seems to be self-evident . Henceforth, I intend to devote my utmost and pool my wisdom with President Yeltsin in order to achieve that goal based on the principle of mutual benefit.

Thirdly, we must remember that the Northern Territories issue is a matter which our nations have been unable to resolve in fifty years. Obviously, it is very difficult to resolve it. Still, through the hard work of our predecessors, we have achieved many advances, beginning with the TKO Declaration. One example of a major advance toward the resolution of this issue is the movement to foster continuing trust in the islands through visits to graves in the Northern Territories, mutual visits between JPNese citizens and current Russian residents of the Northern Territories and Fishery Frameworks which are currently under negotiation, among other measures. More than anything, steady, concrete progress could become a landmark that will not have our children s and grandchildren s generations inherit this issue. Considering the positive achievements made thus far, I believe that it is the responsibility of our generation to now show the way forward toward the resolution of this issue. I would like to discuss this matter calmly, based on a long-term perspective.

JPN-Russian Federation Economic Issues

In the economic relations between JPN and Russia as well, there is a need to seek concrete progress based on these three principles. From this perspective, I would like to take advantage of this opportunity to put forward two ideas.

First of all, I propose that consideration focus on strengthening economic relations with Russia, especially in SBR and the Far East region, and in particular, in the energy sector. There already exists the Support Plan for Russian Trade and Industry, which I proposed during my tenure as Minister for International Trade and Industry, as well as the Cooperation Committee, which was created based on an agreement concluded with twelve former Soviet republics. Through these and other fora, careful assistance is being provided for efforts to make a transition to a market economy, and these must be continued. The ideas which I would like to outline here consist of efforts beyond these to promote development and foster cooperation, especially in the energy sector in SBR and the Far East region.

Needless to say, Russia is a nation of great natural resources, which if used and developed effectively can trigger stable economic development and contribute to stabilizing the energy needs of the Asian region, where economic growth is generating rising energy demand, and thereby stabilize the energy supply of the world as a whole. Further, the links in the energy supply-and-demand relationship shall be clearly connected to fostering relations of trust and peace throughout East Asia.

Specifically, we certainly could move ahead in dialogue on energy development in SBR and the Far East between JPN and Russia. For example, we continue to cooperate in the oil and natural nrg.g projects in SXL, which been already commenced, natural nrg.g development projects and economic and technical possibility of ptpt construction projects in places like Irkutsk and Yakutsk, can no doubt provide opportunities for discussion and examination. We can certainly further enhance the dialogues which have already begun through such fora as the JPN-Russian Federation Inter-Governmental Commission on Trade and Economic Affairs. Naturally, in order to move ahead with such projects, it is essential that an adequate investment environment be created in Russia, and I am confident that we can expect great things from cooperation through the Initiative for the JPN-Russia Cooperation in the Sphere of Investment, on which President Yeltsin and myself shared the view at the Denver Summit of the Eight. Furthermore, the Energy Charter Treaty can play an extremely important role as an international agreement on investment promotion and trade liberalization in the energy sector, and I have great expectations for its enactment. In addition, there is certainly a need for us to cooperate further to realize the holding of a conference of the eight countries on energy issues proposed by the Russian Federation in Denver.

[5000] Secondly, I should like to tell you of the great interest with which I listened to a recent speech given by President Yeltsin broadcast on the radio. In his radio address of 11 July, the president stated that he had ordered the drafting of a plan aiming to foster Russian corporate executives including 5,000 executive trainees, each year through the dispatch abroad of young, talented Russians. As a response to President Yeltsin s enthusiasm, I intend to take up his challenge and propose that in the future, in consultation with you, the representatives of our nation s business community, the young generation of Russians learn from all of JPN s experiences, spanning the macro- as well as the microsectors, gaining from actual hands-on corporate know-how beginning with our nations economic policies thereby developing the human resources essential for contributing to the building of a new Russia. I would like to tell President Yeltsin that we are more than willing to extend our active cooperation to build human resources in Russia.

I have candidly outlined for you my thoughts on JPN-Russia relations, although clearly, some are still in the process of being formulated. I sincerely look forward to having the earliest possible opportunity to discuss with President Yeltsin in a frank and friendly atmosphere the issues that I have just described, as well as other issues which must be addressed in creating a multilayered bilateral relationship between our two countries that encompasses the security sector and contributions to the Northeast Asian region.

JPN s Relations with CHNa

Next, I would like to touch upon JPN s relations with CHNa. But today, I am not going into details and I would like to briefly mention basic ideas.

As everyone knows JPN and CHNa share a 2,000-year history of friendly relations. However there was a truly unfortunate historical experience at a certain time in recent history. JPN, sincerely recognizing and reflecting on such past history, under its Constitution based on democracy and pacifism, after the Second World War achieved rapid economic growth and became the first Asian country to establish itself as an advanced industrialized nation. On its part, CHNa has overcome many tasks and effected a great transformation, and has recently achieved dramatic development especially through open and reform policy.

In view of these historic experiences and the status of our two countries in the international community of today, continued stability and development in our two nations into the 21st century is extremely important, not only for our bilateral relationship alone, but for the peace and prosperity of the Asia-Pacific region and therefore that of the whole world. We must also recognize the fact that this indeed imparts to our two nations a great responsibility.

This year marks the 25th anniversary of the normalization of relations between JPN and CHNa. I am planning to visit CHNa at the beginning of September and intend to take advantage of that opportunity to add a new page to the long history of friendship between JPN and CHNa. And at the same time, I believe that the two countries must tackle many international issues, while JPN encourages greater cooperation between CHNa and the international community so that CHNa can secure its standing as a constructive partner in the today's Asia-Pacific region.

In this regard, it is absolutely vital that CHNa, whose economy is expanding, participate in the international economic system and therefore JPN continue to support the early accession of CHNa to the WTO and is more than willing to cooperate for that. I conveyed this message to the other leaders at the Denver Summit meeting. Furthermore, while continuing to promote cooperative relations in such international fora as the United Nations Security Council, APEC and ARF, I believe that it is important to deepen dialogue between JPN and CHNa on issues directly related to the stability of this region, including the issue of the KORn Peninsula.

[ecx & nrg] Two common issues in which JPN and CHNa ought to cooperate in particular are topics I would like to discuss today, namely the environment and energy.

Considering environmental issues, in addition to the need to protect rare species and forests, the issue of air and water pollution resulting from the rapid economic development pursued by CHNa has the potential to exert a direct influence on our nation, which borders CHNa, in the form of acid rain and other effects. JPN, principally through the JPN-CHNa Friendship Environmental Protection Centre, makes efforts to monitor air pollution levels, take urban air pollution control measures and transfer related techniques. The Third Conference of the Parties to the United Nations Framework Convention on Climate Change (COPIII) is scheduled to be held in Kyoto in December of this year. Although the positions of participating countries on this conference have not yet converged, I believe that in the months remaining before this conference there is a need to continue to engage in dialogue with CHNa and other developing countries in order to gain their cooperation despite positions on the conference are still diversified among participating countries.

Similarly, in the energy sector, I believe that the high rate of economic growth currently being achieved by CHNa will have a tremendous influence on global energy [tntn] issues. As such, on the demand side, it is necessary that we consider how JPN and CHNa can cooperate to improve CHNa s energy efficiency rates, which are as low as one-tenth of JPN s. On the supply side, securing new sources of energy is an issue which may pose various difficult challenges, and I believe that dialogue on joint oil-field development cooperation and ways to promote the use of nrg.n will become even more important in the future. Furthermore, as I mentioned earlier in the context of JPN-Russian Federation relations, the establishment of a secure energy supply structure in Russia is important for CHNa as well. Indeed, cooperation on development of natural nrg.g in Irkutsk has already begun between CHNa and Russia, and one proposal would be for a development concept including cooperation among CHNa, Russia and others including JPN.

Of course, there are other common issues on which JPN and CHNa can cooperate, including food supply, population and health and medical care, including measures to combat HIV. After my visit to CHNa, a visit to JPN by a leader of the Government of CHNa is planned, and I believe that these opportunities will allow us as neighbors who stand in a position of responsibility for our region and the world to further deepen our dialogue with each other.

Turning our eyes to the history of civilization, treasures kept in the Shosoin of the Todaiji Temple was brought to JPN through a route called the 'Silk Road'. I believe that many people including myself try to imagine what impact the civilization introduced to our country had on people at that time and on us at the present time. With this in mind, we would like to cooperate as much as possible to preserve and succeed to the future those historical and cultural heritage in this area which are in danger.

JPN s Relations with the Countries of the Silk Road Region

In closing, I would like to touch upon JPN s diplomacy vis- -vis the Silk Road region.

JPN has already used Official Development Assistance (ODA) and other means to help the development of the New Independent States of Central Asia, and has sought to enhance its bilateral relations with these countries. In the future, JPN s foreign policy toward this region will be crafted as an organic component of the broad scheme of relations with Eurasia. In this process, I believe there is a need to develop even more elaborated foreign policies than in the past. Member of the House of Representatives Keizo Obuchi reported to me on his impressions immediately after returning from his trip earlier this month to the countries of Central Asia, where he met with their leaders and other officials. Mr. Obuchi s impressions matched exactly the line of thought which I have outlined here.

I would like to channel JPN s foreign policies toward this region into three directions. First of all, there is political dialogue aiming to enhance trust and mutual understanding. Secondly, there is economic cooperation as well as cooperation for natural resource development aiming to foster prosperity. Thirdly, there is cooperation to build peace through nuclear non-proliferation, democratization and the fostering of stability.

Specifically, in terms of enhancing trust and mutual understanding, a remaining task is to strengthen even further the exchanges with countries with which there have already been exchanges of officials and at the same time, to realize exchanges at the official level with countries with which there has not been a sufficient level of exchanges. Indeed, in the near future, a minister-level visit to this region is planned. In terms of cooperation to foster prosperity, it will certainly be important for JPN to promote regional cooperation aiming to create a tpt, telecommunications and energy supply system, and for JPN to cooperate in developing energy resources in that region. I am ardently watching the efforts of JPNese corporations toward their participation in the exploitation of oil and other energy resources in such countries as AZRan and KZXan. In terms of cooperation for peace, to begin with, this autumn, JPN will invite appropriate experts from the region and concerned countries to TKO for a Comprehensive Strategy Seminar, which we will host with a view to more actively contribute to enhancing peace and stability in this region.

It is clear to all that private-sector exchanges must play a vital role in these developments. I know that all of you are already keenly interested in this region and I understand that some missions are planning to visit Central Asia in the near future. I have great expectations that these will be extremely fruitful.

Conclusion

Today I have tried to present my thoughts on what JPN should do in order to foster political and economic stability in the Eurasian continent by touching upon my views of JPN s relations with Russia in particular, and also with CHNa and the "Silk Road" region. We should avoid situations in which a clash of national interests on a particular issue constrains wide-ranging exchanges between two countries and limits the realization of fruitful opportunities by the peoples of both countries. In a sense, conflict of interest and confrontation lie in our minds. Whether we can overcome confrontation, therefore, depends largely on creative thinking, which would enable those responsible for managing confrontation to examine wide possibilities. If there is way in which the Government could help, please do not hesitate to ask.

I hope that my comments here today will have stimulated your thoughts and I look forward to your comments. I would like to thank all of you for your attention today.

 

<>1997jy?: http://us-tech.com/july97/news/news002.htm

Moscow's Ggzz.crp Buys USA-Made Fuel Cell Power System [ecx nrg.new]

International Fuel Cells (IFC) will be shipping a commercial fuel cell built by its subsidiary, ONSI Corporation, to Ggzz.crp, the largest natural nrg.g company in the world. Ggzz.crp serves all of Russia, eastern Europe, and most of western Europe. The company controls about one-quarter of the world's natural nrg.g rzv~.

The fuel cell will be sited in a planned environmental community in Moscow, and signals a significant movement in Russia toward improving not only its energy supply but also the environment. “This fuel cell holds great potential for Russia,” said Vladimir A. Usoshin, General Director of Orgenergogaz, the Engineering Subsidiary of Ggzz.crp. “We need more clean, reliable power, especially power fueled by natural gas.”

“For the USA, the Ggzz.crp purchase represents a continued expansion of trade relations between our two countries as well as an xpt of environmentally clean USA products,” said Robert Suttmiller, IFC president. “This also is a significant step forward for joint USA-Russian efforts to develop alternate energy technologies and improve the environment.”

“The sale to Ggzz.crp highlights the increased sensitivity to the environment that is now prevalent throughout the world,” Suttmiller said. “Clearly, fuel cells offer all nations a significant opportunity to satisfy expanding energy demands without increasing pollution.” Ggzz.crp purchased an ONSI fuel cell power plant called the PC25™. The PC25 provides 200 kilowatts of electricity, enough to supply electricity for nearly 150 homes.

ONSI had already established itself as the primary fuel cell source for NASA space missions. Today, ONSI fuel cells generate power for hospitals, hotels, universities, military installations, and manufacturers. Currently, more than 100 ONSI fuel cell systems are in operation around the world.

“Improving the environment in Moscow and throughout Russia and eastern Europe is a very important consideration for Ggzz.crp We are very excited about the fuel cell because it operates so cleanly,” said Usoshin. “In addition, as our economy strengthens, we have found it is more cost-effective to add fuel cells than to expand the electrical grid.”

The ONSI PC-25 family, the only commercially produced fuel cell system today, is a phosphoric-acid fuel cell module that provides all of the anticipated advantages of clean power generation: no environmentally destructive emissions or radiation, quiet, on-demand operation, and extraordinarily high efficiency. Since fuel cells normally produce direct current, the module's output goes through an electronic DC-to-AC conversion system that is reported to be 98% efficient.

The module's water waste is recycled back through the system's steam hydrogen reformer, since this consumes a certain amount of water and heat energy. The rest of the system's heat output can be efficiently converted to more electric energy by cogeneration, or can run a building's heating and cooling systems. Nothing is thrown away, except for a relatively small amount of carbon dioxide.

For more information, contact:
ONSI,
P.O. Box 1148, South Windsor, CT 06074.
Tel: 860-727-2307; fax: 860-727-2319.

 

<>1997su?:JPN's Position in World Energy Consumption [SOURCE]

JPN
4th in total primary nrg consumption after the USA, RUS CHNa
3rd in nrg.p and nrg.a
5th in nrg.c
6th in nrg.g and nrg.eh

With highly intensive industrial production taking place on its closely populated land, JPN relied on overseas sources for 86.4% of its total primary energy supply in FY1993. This rate is the highest of all major industrial countries. As a result, JPN accounts for a very large proportion (14.3%) of the world's energy imports, ranking second after the USA in total primary energy imports, first in nrg.c and natural gas, and second in crude oil and oil products.

JPN's Long Term Energy Forecast

The JPNese government's current official forecast for long term energy demand and supply (FY1992-2010) projects that JPN's energy supply during the period of FY1992-2010 will increase at an average annual growth rate of 1.2%, or in terms of oil equivalent, from 541 million kl in FY1992 to 662 million kl in FY2010. The fundamental objectives of government energy policy are minimum increases in energy demand, a lower dependency on oil and a higher share of non-fossil fuels in total energy supply.

JPN's Primary Energy Supply and Demand

The energy demand and supply structure in JPN changed significantly with the promotion of energy conservation [enx.c] after the oil crisis in 1973. Growth of energy consumption fell below the economic growth rate. Dependence on nrg.p was greatly reduced and dependence on nrg.a increased.

In FY1994, JPN's final energy demand totalled 3,478 trillion kcal, a 3.8% increase from the previous year's level. By economic sector, energy demand in the tptation sector showed a robust increase of 4.7%, in contrast to 3.8% and 3.3% increases in demand for the industrial and residential/commercial sectors respectively.

Meanwhile, JPN's primary energy supply (indigenous production plus imports) in FY1994 totalled 5,339 trillion kcal, a 5.4 growth from the previous year's level of 5,067 trillion kcal.

A source-by-source breakdown of JPN's total primary nrg supply:
1993FY share of nrg.p/LPG = 56.6%
1994FY share of nrg.p/LPG = 57.4%

Whereas

1994FY supply
nrg.c         = 16.4%
LNG           = 11.3%
nrg.a & nrg.eh = 02.9%

nrg.p: JPN is in a vulnerable position with respect to energy supply security, heavily relying on imports for 99.7% of its oil requirements. After the oil crisis in 1973, JPN worked to disperse its oil imports away from the Middle East. Dependence on the Middle East dropped from 77.5% in fiscal 1973 to 67.9% in fiscal 1987. However, the%age of imports from the Middle East has risen since then because of an increase in the region's output and lower pricing policies, and in 1995 it returned to 78.6%, exceeding pre- oil crisis levels. Nevertheless, the central objective of JPN's oil supply policy continues to be to ensure a steady supply of oil through diversification of supply sources as well as development of its own oil sources.

Nrg.c: JPN's annual nrg.c supply (thermal and metallurgical) has reached the level of 133 mT in 1995, accounting for 16% of its total primary energy needs in FY1993. With domestic production shrinking below the level of 7 mT, JPN now depends for more than 90% of its imports (126.18 mT in 1995, up 7.5% from 1994) on major offshore suppliers, such as Australia (51.5%), Canada (14.1%) and the USA (8.9%).

Natural Gas: Demand for natural nrg.g has been growing steadily, because of high calorie values and cleanness. Consumption increased by 8.4% in FY1989, 6.8% in FY1990, and 6.3% in FY1993. JPN's LNG imports account for 95.6% of JPN's total natural nrg.g supply. A very high proportion (72.0% in 1995) comes from Indonesia and other ASEAN members.

nrg.a already an integral part of JPN's energy mix, accounting for 11.3% of total primary energy supply and 27.9% of total nrg.e power generation in FY1994. At the end of FY1994, the number of nrg.a generation facilities in operation was 50, including 3 units commissioned in 1994, with a total output of 40,531 MW. In 1995, 6 units are under construction (6,707 MW), and 2 at an advanced stage of planning (1,650 MW), with their capacities adding up to 46,000 MW. Additional capacity of more than 20,000 MW is proposed for construction by FY2010. Canada is the largest supplier (27%) of uranium, followed by Australia.

JPN's Oil Demand and Supply

JPN's crude oil imports in 1995 totalled 267 million kl, down 1.5% from 1994.

The five largest crude oil suppliers are the U.A.E. (71,900,000 kl in 1994, 26.0% of total imports), SaA (51,997,000 kl, 19.3%), IRN (22,866,000 kl, 9.7%), Indonesia (21,622,000 kl, 8.91%), and Oman (17,094,000 kl, 6.7%). JPN's reliance on Middle East crude rose to 78.6% in 1994 from 76% in 1993.

Oil producing countries' DD/GG (direct deal/government-to-government deal) crude supply to JPN showed a robust 8.3% increase in FY1993, accounting for almost two-thirds of JPN's total crude oil imports.

JPN's 10-year Power Development Plan

The JPN Electric Power Survey Committee of MITI published its latest revised 10-year forecast of JPN's electric power demand through 2004, projecting that JPN's total power demand, including non-electric utilities' in-house power generation, will grow at an average annual rate of 2.3% to 1,029.8 billion kwh in FY2004.

In more general terms, or excluding in-house power generation, total power demand is projected to increase from 709 billion kwh in FY1993 to 916 billion kwh in FY2004, increasing at an average annual rate of 2.4%.

The 2.4% increase is to comprise a 2.7% increase in lighting use, a strong 4.4% increase in the commercial sector, and 2.0% and 1.0% increases in the small- and large-scale industrial sectors respectively.

MITI's new 10-year plan for expansion of JPN's power generating capacity was developed on the basis of plans submitted by the electric utilities. To ensure a stable supply of power to meet demand, said MITI, overall power generating capacity must be increased by 68.19 million kw during the next decade, from 197.69 million kw at the end of FY1994, to 265.88 million kw at the end of FY2004.

The table below shows a forecast by source of power generation in %age terms.

nrg.a generation is expected to increase its share from the 31% in FY1994 to 32% by FY2004, with LNG- and nrg.c-fired power generation raising their shares from 22% to 24% and from 12% to 20%, respectively, at the expense of oil-fired power generation, the share of which will be reduced from 25% to 14% over the next decade.

Type |1994FY |2004FY
nrg.eh |09% |10%
nrg.a |31% |32%
Thermal Power |60% |58%
nrg.p| (25% |(14%
LPG |(00.2% |(01%
LNG |(22% |(24%
nrg.c |(12% |(20%
nrg.g |(00.2% |(00.4%
Total: |100.0% |100.0%

Fuel Consumption:
nrg.c (mT) |35.6 |70.3
LNG (mT) |31.3|38.2
nrg.p (million kl) |42.4 |26.5

JPNese Government's Action Programs for Deregulation

The JPNese government adopted two bills to deregulate the energy sector during the current Diet session. The two comprise:

i) a bill to revise the [nrg.e] Electric Utility Industry Law; and
ii) a bill to abolish the [nrg.p] Provisional Measures Law for Importation of Specified Petroleum Refined Products; and revise of the Stockpile, and Gasoline Sales and Distribution Business Laws.

1) Petroleum Products Import Law

The Provisional Measures Law on the Importation of Specified Petroleum Refined Products will be abolished at the end of March 1996. This Law has effectively restricted petroleum importing for civilian uses (gasoline, kerosene and light oils) to petroleum refining corporations. Its abolition will allow competition in the domestic market between domestic and foreign products and reduce discrepancies with other countries in the domestic price structure.

2) Petroleum Stockpile Law

After abolition of the existing petroleum products import law, importers of refined petroleum products will no longer be required to possess refining facilities: they are, however, required to be placed under the statutory control of the Petroleum Stockpile Law, which obligates them to maintain 70 days' supply of oil products. If the new-comers have refining facilities under their control, stockpiling can be in crude. However, greater flexibility will be imparted to the officially authorized group-based storage system to encourage its use by new importers following abolition of the existing Law.

3) Product Quality Standards

Although import product quality standards (such as octane levels) are a private sector responsibility, safety and environment-related quality standards (such as the lead content of gasoline) will be maintained through administrative or ministerial ordinances.

4) Gasoline Sales & Distribution Law

Under the existing Gasoline Sales and Distribution Law, 44 zones are designated by the zoning system, and excessive competition is barred by imposing restrictions on the construction of gasoline stations in each zone. The zones will be reduced in stages and eventually abolished altogether in October 1996.

5) Electric Utility Industry Law

Under existing regulations, non-electric utility firms entering into the power wholesale business need to obtain MITI's permission; however, after deregulation scheduled for fiscal 1996, a bidding system will be introduced to enable non-electric utility firms to wholesale power to the ten major electric utilities; moreover, non-electric utility firms will be free to retail power directly to consumers through the ten major electric utilities' existing power transmission and distribution systems.

JPNese Investment in Energy Development Projects in Canada

The following JPNese companies have been engaged in energy exploration and development projects in Canada =
*--JPN Oil Sands Co., Ltd. (Alberta) (Canadian Partner: Norcen) Established in December 1975 with a total capitalization of ¥3,8066 million.
*--Canada Oil Sands Co., Ltd. (Alberta) (Canadian Partners: Esso Resources, Occ.crp.nrg, Petro-Canada) Established in December 1978 with a total capitalization of ¥20,710 million to perform a field test for developing heavy oil recovery technology
*--Arctic Petroleum Corp. (Beaufort Seat) (Canadian Partner: Amo.crp.nrg Canada) Established in February 1981 with a total capitalization of ¥48,682 million to provide loans to Dome Petroleum for oil exploration in the Beaufort Sea. Amo.crp.nrg Canada has been conducting seismic survey and wildcat drilling operations after the merger with Dome Petroleum in September 1988
*--JPN Canada Oil Co., Ltd. (Alberta) (Canadian Partner: Petro-Canada). Established by Mitsubishi {Mcb} Oil in February 1992 with a total capitalization of ¥4,000 million to produce synthetic oil from open pit mining of oil sands (Syncrude project)
*--JPN UTF Oil Sands Ltd. (Alberta) (Canadian Partner: AOSTRA) Established in March 1992 with a total capitalization of ¥170 million to join a research project of AOSTRA (Alberta Oil Sands Technology and Research Authority) for heavy oil recovery
*--Idemitsu Uranium Exploration Canada Ltd. {nrg.a} (Saskatchewan) (Canadian Partner: CAMECO) Idemitsu Kosan participated in January 1982 in Cameco's uranium exploration and development project in Saskatchewan,by acquisition of 12.875% of equity in Cigar Lake Mining Corp
*--JPNese Steel Companies (Canadian Partners: Teck Corp./Manalta Coal Ltd.) NKK, Kobe Steel, and other steel companies have participated in equity of three nrg.c development projects (Quintette, Bullmoose and Gregg River) in British Columbia and Alberta to develop nrg.c for xpt to JPN since 1983.

© Department of Foreign Affairs and International Trade, 1997.

 

<>1997jy27:WASHINGTON POST| "Clinton Drops Objections To IRNian Gas Pipeline"

Clinton administration has decided not to oppose a $1.6 billion ptpt that would carry huge quantities of Central Asian natural gas across IRN, the first significant easing of the economic isolation of the Tehran regime, according to U.S. officials and other sources.

     The 2,000-mile ptpt project, now undertaken with tacit U.S. acquiescence, would mark IRN's first participation in any major international energy project since the 1979 Islamic revolution there. That upheaval and the seizure of American hostages led to U.S. sanctions and a long, international campaign by Washington against IRN's fundamentalist government for allegedly supporting terrorism.

     The ptpt would carry gas from TKMistan on the eastern side of the CSP.S
 across a 788-mile stretch of northern IRN to energy-needy Turkey and, eventually, to Europe. One official said the Clinton administration does not endorse the ptpt but has concluded that such a project ``does not technically violate ILSA,'' the 1996 IRN-LBY Sanctions Act.

     The law bars U.S. and foreign investments of more than $40 million in the development of IRN's energy sector, but does not address ptpt~ carrying another country's gas or oil across IRN, the official said.

     IRN would reap a portion of transit fees for allowing the gas to flow under its territory, and sources indicate the ptpt eventually might also transport IRNian gas.

     In part, the administration's decision to go along with the ptpt reflects the heightened priority now given to helping the independent former Soviet states of Central Asia assert their independence from Russia. The CSP.S
 region holds the largest oil and gas rzv~ outside the PER.G, but, historically, Moscow has looked on these resources as a long-term reserve for its own gas and oil needs.

     Russia has been the traditional market for TKMistan's gas rzv~, the world's third largest. For that reason, a trans-IRNian ptpt would advance a goal of U.S. policy to provide multiple outlets for Caspian rzv~ that do not run across Russian territory, U.S. officials noted.

     One oil industry representative likened the complex geopolitics involved in establishing ptpt routes for the landlocked Caspian treasure to a ``three-dimensional chess game.''

 

 

<>1997au27:Competition For Oil, Gas Could Re-Ignite Rivalry Between Russia, TRKy

University Park, Pa. -- Russia and TRKey, once rivals in the 18th and 19th centuries, may face off again over vast oil and natural nrg.g rzv~ in the former Soviet Union.

"TRKey and Russia are already competing for ptpt~ that would carry oil from AZRjan and KZXan and nrg.g from TKMistan," says Dr. Robert E. Harkavy, professor of political science at Penn State. "The Russians are trying to pressure those countries, all former Soviet republics, into putting the ptpt~ through Russia, while AZRjan prefers that the ptpt go through TRKey. AZRjan does not want Russian control of its oil resources."

Harkavy and Geoffrey Kemp, director of Regional Planning Programs at the Nixon Center for Peace and Freedom, are co-authors of the recent published book, "Strategic Geography And The Changing Middle East," published by the Brookings Institution Press for the Carnegie Endowment for International Peace.

[C.ASA TRK AZR] According to Harkavy, any shift to a fundamentalist Islamic government in Turkey could lead to a dangerous, spoiler role in Central Asia, where four of the five new republics are Turkic and look to Turkey as a role model, as do the Turkish-speaking Azeris of AZRjan.

[BLK.S] "These reasons, together with the continuing strategic importance of the Black Sea, bear directly on relations between TRKey and Russia," Harkavy says. "Turkish-Russian competition over these and other issues has been compared to the geopolitical competition between Russia and the Ottoman Empire during the 18th and 19th century. Turkey and Russia could again be placed in an adversarial relationship, with the possibility of military confrontation on the Black Sea coast."

AZRjan, the sole Commonwealth of Independent States (CIS) country completely free of Russian forces, has been faced with increasing pressure from Moscow to join CIS collective security/air defense arrangements, allow military facilities at Gandja and Gabala, and accept joint naval patrols of AZRjan's sector of the CSP.S
.

"AZRjan has asked the TRKish president and prime minister to seek Washington's assistance in resisting the above Russian demands," says Harkavy.

[ARM N-K] In the recent past, the clout of the Armenian lobby in Washington has put distance between the USA and AZRjan, in the context of the struggle over Nagorno-Karabakh. However, the oil leverage exercised by AZRjan has begun to tilt matters the opposite way.

 

<>1997se19:Friday |Market Analysis and Commentary| Jeffrey Hyde,  Equities Analyst| WEEK IN REVIEW: Summary for week of September 15- 19:

The Russian Trading System (RTS) finally reversed itself from a downward trend and gained 2.9% on the week to close Friday at 497.94. In general, it was a rather stable week as the market advanced 11 points, 8 of which came on Friday. Day to day fluctuations remained within a fairly narrow range.

Trading volumes for the week averaged $61.4 million, quite similar to last week. The reason for the low volumes seems to be that buyers are still wary of the Russian market. Foreign funds are busy in their home markets trying to catch domestic rebounds. Russian investors are hesitant to add to their own positions until a trend becomes clearer. At the same time, those holding stock are reluctant to sell. Investors with a long-term approach realize that significant rises and falls are part of the Russian market. Those who bought during the market's incredible rise during the first half of the summer have seen the higher levels and are waiting for prices to bounce back. Those who recently bought shares did so because prices look cheap at current levels.

Of the major sectors, the oil industry did the most to help propel the market's climb this week. Tatneft (TATN) led the charge as it soared 11.8% to $154. Surgutneftegaz ended the week at $0.23, up 7%, due to a 4:1 stock split. Nizhnevartovskneftegaz (NZGZ) and Sibneft (SIBN) both gained over 6% to round out the primary oil gainers. Leading blue chip LUKoil (LKOH) rose 1.4% to $24.03.

The energy industry edged forward on the heels of Rostovenergo (RTSE) which gained 4.5% and Krasnayarskaya Gas (KRSG) which increased 3.4%. Mosenergo (MSNG) crawled 1.1% higher to close just short of $1.60. Unified Energy Systems (EESR), or UES, was a minor disappointment as it retreated 0.3% to $0.40.

The telecommunication sector was down only slightly, but it continues to lag other leading industries despite having enormous potential. Premier communication providers Rostelecom (R T K M) and Moscow City Telephone (M G T S) ended in negative territory closing at $4.20 (-0.2%) and $2420 (-0.8%), respectively. On the bright side, preferreds for Murmanskelectrosvyaz (MUELP) and Kalingradelectrosvyaz (ESKLP) jumped 12.4% and 9.5%.

In a move that surprised many analysts, shareholders from Norisk Nickel (NKEL) changed their minds and voted not to double capital through a rights issue. The action was applauded by minority shareholders and foreign investors, as the price for Norilsk shares rocketed on the news. On Wednesday, however, Norilsk's board announced that it was planning an extraordinary shareholders meeting in November to vote on a new rights issue proposal, modified from the one just rejected. As could be expected, shares of Norilsk Nickel were quite volatile this week, gaining 2.8% to close the week at $12.35, but ending on a somewhat confusing note.

ADR programs continue to be popular among Russian companies. Rosneftegazstroi (RNGS [Rsn.bdg.crp]), an oil and gas equipment company, launched a level-1 ADR program in order to improve liquidity and increase its international recognition. Aeroflot International Airlines will issue level-2 ADRs, covering up to eight% of the stock. Aeroflot officials also said that the state may auction off 51% of the company in early 1998. Finally, representatives at Samaraenergo (SAGO) announced that the company was only in the negotiation stage, but does plan to proceed with an ADR program, probably level-1.

The Nizhny Novgorod and Sverdlovsk regions both received credit ratings of BB- from Standard & Poor's, and their outlooks were declared stable. Nizhny Novgorod is Russia's third largest city in terms of population and is home to the popular auto manufacturer GAZ (GAZA). GAZ was actually one of this week's leading performers as its price jumped 12.8% to $141. The Sverdlovsk Region, located around the Ural Mountains where Europe and Asia meet, is one of Russia's most industrialized areas and is well endowed in natural resources.

On Wednesday, Russia officially joined the Paris Club of creditor nations. This inclusion should help Russia in collecting debts owed to it from the Soviet Union days of about $37 billion. Repayments could reach $500 to 600 million a year. Russia is also scheduled to sign a deal with the London Club of bank creditors on October 6. In addition, President Yeltsin indicated that Russia would stop borrowing from the International Monetary Fund in 1999. The net result of these developments is that Russia is likely to receive a re-rating, thus enabling Russia to obtain cheaper debt on international markets than it can now. It also reflects increasing confidence in the direction of Russia's economic reforms.

WHAT TO WATCH: Forecast for week of September 22-26:

Confidence is slowly but surely returning to the Russian stock market. However, most investors are first looking to see if the world's leading stock exchanges can hold on to and then build upon recent gains. If they can, interest will find its way back to Russia's emerging market as both a means of diversification and an attempt to obtain the high returns that people are coming to expect from the Russian market. Whereas downturns in world stock markets are immediately felt in Russia, upturns in leading world market generally precede bullish tastes in Russia from 6-10 days. Blue chips should start to rise over the next two weeks. If this rise in first tier blue chips is accompanied or followed by an increased interest in second tier stocks, the bulls will not only be on their feet but will be charging forward.

As they did last week, oil stocks should continue to be the primary force behind growth in the market this week. However, until confidence in the Russian market returns to full force, foreign investors are likely to stick to the safer and more reliable first tier oil companies like LUKoil (LKOH) and Surgutneftegaz (SNGS), thus pushing up their prices in modest proportions. Sakhalinmorneftegaz (SKGZ) and Tatneft (TATN) are also attractively priced and should continue to appreciate.

Unified Energy Systems (EESR) and Irkutskenergo (IRGZ) appear to be preparing for minor launches, but could still be a week or two away. Regardless, these two energy companies were hit the hardest in August and haven't come close to recovering. As a result their shares appear to be trading at significant discounts. Both energy companies should at least see moderate rises this week as investors gradually return to the Russian market.

Telecoms may remain mixed throughout the week. However, three telecoms look poised for growth. Ural Telecom (URTC) will move its registrar to Moscow on September 23. This move should improve liquidity and push the price up somewhat. Ural Telecom is severely undervalued, even by Russian industry standards. Murmanskelectrosvyaz (MUEL) could see a jump in its price this week after announcing a 68% increase in net profits for the first half of 1997 in relation to the same time period for 1996. The announcement was made late last week, and the market has been slow to react. Tumen Telecom (TUTE) should benefit from the anticipation of its ADR program on October 1 and the related road show promoting the stock that is now underway.

Investors who are daring, but blessed with patience, should consider buying shares of Khimprom (HIMC). Basically, Khimprom is in the turn-around stage and has great possibility for the days ahead. Khimprom is one of Russia's foremost chemical plants and recently announced joint venture plans with DuPont to develop crop protection capabilities, a market with tremendous growth potential. Over the last year, Khimprom has made great strides in climbing out of debt territory and has spun off un-profitable divisions. Khimprom has the potential to increase eight to tenfold over the next year. However, despite a listing on RTS-2 and selling at a major discount, trades in Khimprom are extremely rare, leading to liquidity concerns.

Making its debut this week is the RTS-3, which includes forty companies, mainly from the third tier. In the first stage of operations, trades over the RTS-3 will operate over an "intra-net" between primary participants and market makers. The advantage of the RTS-3 is that it will simplify trading in these stocks and provide solid quotations. Over time the RTS-3 could serve as a point from where new stocks are introduced to the big market.

This week's wild card that could help boost stocks is if talks between Russian Prime Minister Victor Chernomyrdin and US Vice President Al Gore make headway. The so-called Gore-Chernomyrdin Commission begins this Monday and is expected to cover a wide range of economic issues. Successful talks should help to improve investor confidence, and if really successful, could lead to investment excitement.

 

<>1997se22:Forbes online [SOURCE] [Ggzz.crp] "Move over, Exx.crp.nrg and Shell.crp.nrg. Russia's Ggzz.crp wants some of your overseas markets. Make no mistake: It will probably get them"|>Klebnikov,Paul [ID]| "Sorcerer's apprentice"

IN THE CHAOTIC Russian economy nrg.g producer Ggzz.crp stands out as a model of good management and operating efficiency. Unlike Russian oil companies, whose production dropped after the fall of communism, Ggzz.crp has kept its production relatively stable. "In the 30 years Ggzz.crp has been selling nrg.g to Western Europe," says Niccolo Uzielli of New York-based Poten & Partners, "it has never missed a delivery. It has performed like a Swiss watch."

Outside of Russia, via the Progress ptpt from its nrg.g.ggr in Yamburg and Urengoi in northern SBR, Ggzz.crp delivers $10b worth of nrg.g annually to consumers in Germany, Italy, France and other parts of central Europe.

Natural nrg.g is relatively cheap to produce, and it is environmentally correct. For these reasons demand for it is expected to grow much faster than the demand for oil, especially in Europe and the fast-growing Asian markets. There is just one problem: The world has more potential supply right now than potential demand. For the European market, Algeria and NOR want to step up production. With Nigeria and the Middle East also competing for this market, the last thing the oil industry wants is more natural gas. Yet more is precisely what Ggzz.crp has.

It already keeps large amounts of nrg.g shut in below ground and has pumped nearly 10% of one year's output into storage tanks. Yet Ggzz.crp has announced plans to tap undeveloped nrg.g.ggr on the frozen Yamal peninsula in SBR and from there construct a 3,000-mile ptpt to the heart of Europe. If built, the new ptpt will supplement Ggzz.crp's current line that runs on a parallel route 400 miles to the south. "With the Yamal ptpt," says Ggzz.crp Chairman Rem Vyakhirev, "European customers will be able to receive Russian nrg.g from different directions. This increases the reliability of the system, increases the security and, as a result, raises the price."

{7ss} Vyakhirev is being careful not to rile his big international oil company competitors, but his meaning is pretty clear: Forget your plans for expanding in the European market; it belongs to Russia. "Ggzz.crp is sending a signal to the other nrg.g companies," says Par Mellstrom of Moscow-based Brunswick Brokerage. "The message is: Don't even try producing more nrg.g from the North Sea or Algeria. We will start producing from this new field before you start producing from yours."

To strengthen its foothold in Europe, Ggzz.crp is moving into the distribution end of the business. In Germany it is expanding through a joint venture with BASF subsidiary Wintershall AG to operate a nationwide retail nrg.g distribution network in competition with long-standing Ggzz.crp client Ruhrgas AG. In Italy it is doing the same thing. In all, Ggzz.crp has at least two dozen marketing joint ventures in Europe.

Holding the line

The Russian economy collapsed after 1990, and impoverished domestic customers could no longer pay for their gas. But Ggzz.crp kept its production steady and boosted xpt~.

[TABLE] Sources MC Securities Lyd.; Brunswick Brokerage

Further east Ggzz.crp is moving with equal determination to lock in local markets. It has taken big equity stakes in distribution companies in Poland, Belarus, Moldova, Lithuania, Latvia, Estonia and Finland. Says Mellstrom, "Ggzz.crp wants some of the downstream margin."

To the south, Ggzz.crp recently signed a $13.5 billion long-term contract to provide nrg.g to TRKey through a proposed ptpt under the Black Sea, and is negotiating a big contract with Israel for nrg.g from the same ptpt. "We're not yet a Western-style company," says Vyakhirev. "But we're getting there."

Located as Ggzz.crp is in the heart of the Eurasian landmass, its markets are not limited to Europe and Asia Minor. JPN, KOR and now CHNa have shown a voracious appetite for natural gas. Conveniently hard by, Ggzz.crp is the natural candidate to exploit the giant untapped nrg.g rzv~ in Yakutsk, Irkutsk, the Altai and other parts of eastern SBR.

{Mob.crp.nrg} At the moment those East Asian markets are served with liquefied natural nrg.g shipped by boat from such places as the Northwest Shelf off Australia and Mobil's giant PT Arun plant in Indonesia. But it is much cheaper to ship nrg.g in its natural form by ptpt than to liquefy it and ship it by boat, and with the exception of JPN, these markets are contiguous with Russia. There is talk of a ptpt to CHNa, perhaps to KOR and even underwater to JPN.

The problem, of course, is money—not billions but tens of billions of dollars—and Russia doesn't have that kind of money. Ggzz.crp netted $1.80b last year on $25.0b in sales, but not all of that is real money. Vyakhirev says that 95% of his domestic sales are for barter or in exchange for IOUs.

In Russia customers pay with ptpt, drilling equipment, trucks, chemicals, even sausages and cabbage. Vyakhirev couldn't cut off deadbeat customers even if he wanted to: His company is too important to Russia's economic viability. It accounts for 6% of Russia's GDP, 17% of its xpts and 26% of the government's tax revenues. Were it to withhold deliveries from nonpayers, kindergartens would close, pensioners would freeze, hospitals and military installations would be blacked out. "I cannot cut off my domestic customers," says Vyakhirev. "All of Russia would be up in arms."

Thus Ggzz.crp has $13 billion in receivables on its books, half from Russian electric utilities. It will need luck to collect even a small part. Another perpetual debtor is Ukraine, which has run up an estimated $3 billion in debts to Ggzz.crp.

Bigger than the giant

Ggzz.crp has the gas. Now it needs the customers.

[Table shows Ggzz.crp at ca. 40% of total production of world’s great petroleum sisters] Source MC Securities Ltd.

The Russian government is dependent on Ggzz.crp, too. Last year 31% of Ggzz.crp's revenues went to the government as taxes. So badly does the government need tax revenue that it does not permit Ggzz.crp to offset its tax payables against the receivables due from government customers like state farms, the military and municipal housing authorities. Ggzz.crp is expected to stay current on its tax payments, while its receivables gather dust.

So Ggzz.crp will have to raise money abroad for its ambitious expansion plans. A sale of ADRs in London last fall netted $429 million for 1% of the company. Since then Ggzz.crp has gotten more than $4 billion in loans from Western banks. It is seeking to place over $3 billion in convertible bonds and Eurobonds, starting in the next few months.

GO nrg.g.bxo/Vyakh.  In part, of course, he is a bureaucrat: Ggzz.crp is so central to the Russian economy that it cannot function solely as a private business. But make no mistake: Vyakhirev is fast learning Western business ways.

And one thing he has learned well: You go where the money is. With the domestic market chaotic and unprofitable, the real money for Ggzz.crp is overseas. Of that hard fact the oil-producing world had better take note. "Don't think I will be puffing up my chest and boasting," says Vyakhirev, chuckling. "It's like the old fairy tale in which the little sorcerer says: I am not yet a sorcerer—I am only an apprentice."

The Russian discount

By Paul Klebnikov

{Ggzz.crp Shell.crp.nrg Exx.crp.nrg} GAZPROM EMPLOYS 375,000 people and produces more fuel than any other company in the world =

9.80mB/d.nrg.p equivalent—nearly three times more than RoyalDutch/Shell.crp.nrg, four times more than Exx.crp.nrg. But at a recent

$47b, its market capitalization is just one-third that of Exx.crp.nrg, one-quarter that of Royal Dutch/Shell.crp.nrg and about equal to that of Amo.crp.nrg, whose production is a tiny fraction of Ggzz.crp's

With its ADRs (first offered in October 1996 in London at $15.75) at a recent $19.90, Ggzz.crp trades at only 7 times last year's operating cash flow, compared with 10 to 12 times last year's cash flow for the Western majors.

"Investors have placed no value on our nrg.g rzv~," fumes Ggzz.crp Chairman Rem Vyakhirev.

Ggzz.crp's own reserve estimates—33.0tcM.nrg.g & 14.60bB.nrg.p & condensate—dwarf any other nrg.p.cmp.

mkt value equivalents, compared with Amo.crp.nrg & Exx.crp.nrg =
Ggzz.crp's rzv~ at  $0.20/B.nrg.p
Amo.crp.nrg’s rzv~ at $8.00/B.nrg.p
Exx.crp.nrg’s rzv~ at $11.00/B.nrg.p

The market, of course, is applying a deep discount to Ggzz.crp's equity valuation because of the mess in its domestic markets. The accompanying table shows some key figures for Ggzz.crp and other prominent Russian companies with ADRs outstanding. -P.K.

<>1997oc15:JPN To Quiz Russia On Gas Field Development Guarantee

http://mercury.nikkei.co.jp/enews/TNKS/back/496Economy_Finance.html#gen136

TKO (Nikkei)-JPN will ask Russia if it will apply its Production Sharing Law to developing the SBR Koviktinskoye nrg.g.ggr ca.400km N of IRK, a move that would push forward JPNese companies' investments, government sources said Tuesday.

JPNese officials will make the request during a 97no01;02:Krasnoyarsk Summit

JPN National Oil Corp. and 10 JPNese companies including TKO.nrg.g Co. and Sumitomo {Smt} Corp. are expected to start a feasibility study in 1998 on the nrg.g.ggr

The primary task involves laying a 3,500km ptpt to Beijing from Koviktinskoye. The area's rzv~ are estimated at 850bcM, more than 10 times JPN's annual consumption. The overall project is expected to cost around 1 trillion yen.

<>1997oc21:CHNa, SKOR Show Interest In Russian Natural Gas Project

TKO (Nikkei)-CHNa and SKOR have expressed interest in purchasing nrg.g to be extracted by a multinational venture in RUS SBR IRK. Ten JPNese companies are expected to participate in the consortium, including JPN National Oil Corp. and Sumitomo {Smt} Corp. Interested parties from JPN, Russia, CHNa and SKOR are set to hold their first meeting on the project as early as next month. [IE:997no]

The nrg.g.ggr’s rzv~ are estimated at some 850bcM. Project managers envisage building ptpt~ to CHNa via MNG, and plan to eventually extend them to SKOR and JPN.

Both the CHNese and SKORn governments are reported to have unofficially informed Russia and project participants of their readiness to purchase some 10bcM.nrg.g each.

Prime Minister Ryutaro Hashimoto is expected to indicate JPN's readiness to cooperate in the venture to Russian President Boris Yeltsin when the two leaders meet early next month.

Other JPNese participants include Itochu Corp. and TKO.nrg.g Co.

<>1997oc22:KOR

10-22-97 : Korea to Jointly Develop SBRn Gas Field, Pipeline with Three Countries

    The construction of a large-scale gas field and ptpt linking the SBRn town of Irkutsk

    and Pyongtaek, Kyonggi Province, will be jointly promoted by Russia, China and Japan

    starting next month, the Korea Gas Corp. said yesterday. The four countries decided to

    exchange letters of intent to develop the SBRn gas field and construct a 4100km-long pipe

    during a meeting in Beijing Dec. 15, an official at the corporation said. The construction will

    emerge as one of the biggest projects of its kind in the Northeast Asian region. Participating

    corporations are the China National Petroleum Corp. (CNPC), Japan National Oil Co.

    (JNOC), SIDANCO of Russia and the Korea Gas Corp. The firms are known to have held

    separate consultations over the past two years.

    The gas pipe will link Irkutsk in Russia, Ulan Bator in Mongolia, Beijing in China and

    Pyongtaek near Seoul. A total of $11 billion will be poured into creating the gas field, which

    is located 450km north of Irkutsk, SBR and is known to reserve a total of 760 million tons

    of natural gas. Korea and Japanese companies are expected to compete fiercely in

    investment for the construction sector, which may amount to 80% of the total stake.

    The construction of the undersea tunnel between Beijing and Pyongtaek is expected to be

    taken over by the Korean side under the current circumstances, the official said.

    When the gas field is completed, it will be able to provide a total of 20 million tons of natural

    gas to China, Russia and Korea annually for 30 years beginning in 2006, he said. It then will

    provide 7 million tons of gas annually to Korea during the cited period. With the ptpt's

    construction, Korea will be able to acquire natural gas at a price 22 to 25% lower than

    the import price of the liquefied petroleum gas (LPG), he said.

    The participating companies from Korea include Kohap Inc. Daewoo Corp., Hyosung

    Corp., Halla Corp. and LG Corp.

<>1997oc24:RUSSIA TODAY VIDEO|QQN prx Maskhadov,Aslan made sweeping changes in gvt & also otx-dtr of national Southern Oil Co & planning to split it into 3 cmp~, this just on eve of early CSP.S nrg.p coming down the ptpt frm BAKU|90m of ptpt is in QQN

<>1997oc24:JPN-Russia To Hold Regular Energy-Related Talks

TKO (Nikkei)-JPN and Russia have agreed to hold regular talks on general energy-related issues, including assistance to Russian electric companies and development of natural nrg.g.ggr in far eastern Russia, JPNese government officials said Thursday. Bilateral meetings will be held once or twice annually beginning next year to exchange ideas on how to handle an energy shortage in Asia.

Senior officials with the Ministry of International Trade and Industry reached a basic agreement on the talks during a visit to Russia earlier this month. A future topic of debate will center on the development of a natural nrg.g field in Irkutsk, with plans for a direct ptpt to JPN. Setting up an engineer exchange program to aid Russia in upgrading its electric power generation technology will also be on the agenda.

<>1997oc27:Bonn Delegates OK Easing Emission Goals For Russia, E. Europe

BONN (Nikkei)-Delegates to a meeting ahead of the global warming [tntn wrl] conference in Kyoto in December agreed to give special consideration to Russia and 10 Eastern European countries in setting targets for cutting greenhouse nrg.g emissions, delegate sources said Sunday. The clause is to be included in a draft protocol to be adopted by the Kyoto conference.

Under the agreement, Russia and Eastern European countries would be allowed to choose a year in the 1980s as a base to calculate reduction targets, set to be achieved around 2010.

The compromise was made because delegates believe it would be unrealistic for the countries, which are experiencing economic difficulties, to set energy-saving targets similar to those for developed nations, which are to be held to a base year of 1990.

If goals are set against a year in the mid-1980s, when nrg.g emissions peaked in Russia and Eastern Europe, the reduction ratio would likely fall by around 5%, the sources said.

The delegates earlier agreed that the emission-cutting goals will be imposed on 36 countries and regions, including Russia and Eastern Europe.

<>1997oc30:Hashimoto To Offer Russia Lower Trade Insurance Rate

TKO (Nikkei)-Prime Minister Ryutaro Hashimoto will announce a loosening of trade insurance rules for Russia in regards to JPNese investment when he meets President Boris Yeltsin, government officials said Wednesday. The two leaders will meet Nov. 1-2 in the SBRn city of Krasnoyarsk.

The insurance premium - currently the highest rate is applied for Russia - is expected to be lowered by 43.8%, said an official of the Ministry of International Trade and Industry. In addition, the measures are designed so that trade insurance will be provided if the payment is guaranteed by a Russian private bank rather than the government.

The relaxed rules are intended to draw investment from JPNese corporations for the renovation of nrg.p.zvdies, establishment of telecommunications infrastructure, installment of food processing lines and other projects.

If the loosened measures are applied, JPNese businesses are expected to reconsider about 70 projects worth $5.18 billion, according to a MITI study. They hope that trade insurance will be applied to 39 projects totaling $2.17 billion through guarantees by private banks.

JPN presently sets a limit of $2.9 billion in trade insurance for Russia. However, after Russia's economic turmoil, JPNese corporate interest in investment in the nation has weakened, with $1.1 billion in trade insurance unused.

<>1997oc31:RUS bdg underwater ptpt to TRK [8x11] RUSSIA TODAY VIDEO news re.Ggzz.crp preparing irx tender for bdg of compressor station & laying of ptpt on BLK.S floor to TRK:

$0.2b for compresson

$1.5b for BLK.S ptpt

Seven investors have expressed INX, results of bidding to be announced next year

SAME DAY news: FRN Mnr1 Jospin,Lionel mtg w/YlcB stressed that “Russia has a full place in the new European architecture”|Closer ~~FRN-RUS esp. bzn|General need for “multipolar world” [IE:vs-USA great power hegemonism] and rejected USA attempts to plc FRN RUS investment in IRN

<>1997no01:Hashimoto To Meet Yeltsin To Improve Bilateral Relations

TKO (Nikkei)-Prime Minister Ryutaro Hashimoto and Russian President Boris Yeltsin will meet in Krasnoyarsk, eastern SBR on Saturday, and spend the weekend fishing, enjoying the local saunas, and wining and dining together, JPNese government sources said Friday.

Hashimoto aims to establish a personal friendship with Yeltsin during the casual meeting to improve bilateral relations.

The two leaders last met in June at the Denver summit of the Group of Seven industrialized nations plus Russia.

Hashimoto and Yeltsin will not table any formal discussions on the weekend's agenda, the sources said.

The JPNese premier will stay in Krasnoyarsk for about 24 hours on Saturday and Sunday, the sources said.

Hashimoto believes that nurturing friendship with the Russian president is essential for any breakthrough in the current impasse in diplomatic relations between JPN and Russia. The visit will facilitate candid and in-depth discussions between the leaders of the two countries, the sources noted.

The JPNese prime minister intends to hold another informal meeting with Yeltsin, in JPN possibly next spring, according to the sources.

Sumitomo {Smt}-NKK To Supply Double-Hull Tankers {nrg.p.nvy} To Russia

TKO (Nikkei)- {tpt} Sumitomo Corp. has received orders for six 100,000 ton class double-hull crude oil tankers [nrg.p.nvy for NVR] from Novorossiisk Shipping Co. [NVR.tpt.cmp], Russia's largest shipping company, sources close to the JPNese trader said. The orders are worth about 30 billion yen in total. The Russian government holds a 25% stake in the shipping company.

NKK Corp. will build the ships at its Tsu plant in Mie Prefecture, with delivery scheduled between 1998 and 2000.

Sumitomo Corp. received the first four orders in the spring, and two more recently. The trading company is seeking orders for tankers under an arrangement where it extends loans to shipbuilders to help finance production.

Russian shipping companies are replacing their fleets with double-hull tankers to reduce the risk of oil spills.

<>1997no02:ERG column by Friedman,Thomas “China now major consumer of Middle East oil” [8x11 nrg] CHN” state-owned nrg.p co bdg “gathering stations” in KWT [NB! sanguine view of USA rxn.svt at Nixon Center as he contemplates CHN mlt-plt influence & presence in PER.G; compare with tone of all USA accounts of RUS presence in C.ASA] “Early in the next century, Asian need for PER.G oil will far exceed that of the U.S and possibly even Europe, and it is myopic to think that the major Asian powers, either individually or collectively, will not want to have a much greater say in the political arrangements in this region.”]

<>1997no03:Hashimoto, Yeltsin Agree To Resolve Islands Dispute By 2000

KRASNOYARSK, Russia (Nikkei)-Prime Minister Ryutaro Hashimoto and Russian President Boris Yeltsin agreed Sunday to resolve the Northern Territories dispute based on the 1993 TKO declaration and work toward signing a peace treaty between the two nations by 2000, government officials said.

Hashimoto and Yeltsin made the agreement at an unofficial meeting in the eastern SBRn city of Krasnoyarsk on Sunday.

Under the 1993 declaration, the two sides made a commitment to early resolution of their differences over sovereignty of the Kuril Islands, but did not set a deadline. This is the first time they have agreed to a time limit to resolve the contentious issue, marking a turning point in relations following the restoration of diplomatic ties between JPN and the former Soviet Union in 1956, the officials added.

Referring to the islands dispute, Hashimoto told Yeltsin that what occurred in this century should be resolved, if possible, within this century.

As was the case for the SBRn summit, the two also agreed to observe a "no-necktie" approach for their informal meeting set for April in JPN. Hashimoto invited Yeltsin to visit JPN with his family, and the Russian president expressed his willingness.

Hashimoto, Yeltsin Agree On Energy Development In SBR

KRASNOYARSK, Russia, (Nikkei)-JPNese Prime Minister Ryutaro Hashimoto and Russian President Boris Yeltsin agreed Saturday to promote energy projects between the two countries and make efforts to stimulate Russia's market economy. Agreement on the "Hashimoto-Yeltsin Plan" came during the first round of talks which started soon after Hashimoto arrived at this east SBRn city for a two-day visit.

The plan underlines the importance attached to developing energy resources in the Russian Far East. JPNese companies are interested in developing natural nrg.g.ggr in the region for supply to JPN, CHNa and SKOR.

Hashimoto and Yeltsin also agreed on the exchange of visits by top military personnel and joint exercises by naval forces to deal with maritime accidents.

At the meeting, Hashimoto also extended JPN's support for a Russian bid to join the Asia-Pacific Economic Cooperation (APEC) forum, JPNese government sources said.

<>1997no04:RUSSIA TODAY NEWS|Ggzz.crp will borrow

$3.0b frm RUS & 8 foreign bnk~ (including GRM Dresdner Bank) to pay debts & cptalize YAM-EUR ptpt

<>1997no06:RUSSIA TODAY| Berezovskii,Boris will otx soon|97no05:otx-PRX Security Council|nrv sd if he did rt-plt life, it wld be as scx|Nemtsov,Boris & Chubais,Anatolii were vs-B|In other news, stt will fxx 16% of Luk.crp.nrg to cptists,including foreign cptists; also 19% of Slav.nrg.p (RUS-BRUS cmp) will be fxx

<>1997no07:Natural nrg.g growth prospects [ http://www.neste.com/nestew3e/2102.htm]

{Ggzz.crp} Gasum Oy, owned by Neste (75%) and the Russian natural nrg.g supplier RAO Ggzz.crp (25%), imports natural nrg.g to Finland from Russia, takes care of natural nrg.g transmission and the construction and maintenance of the transmission ptpt, and handles natural nrg.g sales in Finland.

1995:nrg.g sales totalled 33.14 TWh [?] (3.30bcM), which accounts for nearly 10% of Finland's energy consumption. Sales were up 3.6% on 1994. Out of total sales, industry accounted for 41%, combined heat and power generation 38%, power generation 10%, and nrg.p.zvd~ and other use 11%.

Because of scheduled completion of new natural gas-fired plants, the years 1997 and 1998 are set to see a marked increase in natural nrg.g consumption in Finland. This growth requires increasing the transmission capacity of the network. Neste is therefore building a 50-km-long parallel ptpt, a 32-km-long new ptpt to a client's plant, and three compressor stations that increase the pressure of natural nrg.g in the ptpt. This FIM 700 million expansion project will be completed in 1997. In conjunction with the work going on in Finland, the St. Petersburg-based Russian transmission company Lentransgaz is building a parallel ptpt towards Finland in the Karelian Isthmus.

In January 1996, Gasum signed an additional natural nrg.g supply agreement which raises Finland's purchases of Russian nrg.g 10% from the 20-year supply agreement signed in 1994. The new agreement becomes effective in 1998.

Gasum received the 1995 Finnish Quality Award in industrial series. The award is granted jointly by the Finnish Society for Quality and the Finnish Foundation for Quality Promotion.

<>1997no08:JPN, SaA To Boost Output At Ethylene Venture

TKO (Nikkei)-JPNese and SaAn companies will invest some 150 billion yen to boost ethylene output capacity at Eastern Petrochemical Co. (Sharq) by 2000, The Nihon Keizai Shimbun reports in its Saturday morning edition.

Saudi Petrochemical Development Co. (SPDC), the JPNese investment arm for the SaA project, has reached a basic agreement to make Sharq one of the largest petrochemical complexes in the world, just ahead of Prime Minister Ryutaro Hashimoto's visit to the country starting on Saturday.

Sharq will tap into its internal rzv~ to finance 30% of the estimated costs of 150 billion yen, and take out loans from the {xpt-mpt bnk} Export-Import Bank of JPN and private banks for the remaining expenses.

The third-stage production, by late 2000, increase to:

2.44mT ethylene output capacity

0.75mT polyethylene capacity

1.35mT ethylene glycol capacity

Staff levels at the facility will also be increased to 1,000 from the current 800.

The bulk of the petrochemical products will be shipped to ASEAN countries, JPN, SKOR and Taiwan.

SPDC is owned 45% by the JPNese government's Overseas Economic Cooperation Fund with the remainder held by 62 JPNese corporations, mainly Mitsubishi {Mcb} group firms including Mitsubishi Corp. and Mitsubishi Chemical Corp.

Sharq is equally owned by SPDC and Saudi Basic Industries Corp. (SABIC).

<>1997no10:RUSSIA TODAY|CHN Bjn|YlcB & CHN prx Zemin Jiang & RUS sign ggr trt BUT ALSO trt re. bdg SBR IRK-CHN PaR shore ptpt|Same day QQN sct of AZR BAKU to BLK.S NVRossiisk ptpt opened|QQN may collect trf

<>1997no12:RUSSIA TODAY VIDEO|YlcB back frm 3d trv-CHN to broaden $1.0b/y irx.trd

<>1997no14:RUSSIA TODAY VIDEO|YlcB urged RUS nsx to gear up for hard winter, but announced that fuel supplies OK. Still urged enx.c nrg

<>1997no17:RUSSIA TODAY VIDEO|Gore,AL sd USA supports multiple ptpt for CSP.S nrg.p at opening of cnf w/KZX prx Nazarbaev,Nursultan|That same day, RUS & IRN agreed to form joint drilling venture to dev IRN S.Pars nrg.g.ggr|Ggzz.crp & National IRN Oil Co agreed after 3d MVA visit by IRN Mob.crp.nrg

<>1997no18:RUSSIA TODAY VIDEO|KZX suport USA crt of IRN & desire to bypass IRN in ptpt of CSP.S nrg.p & nrg.g [but no idl of just which route]

<>1997no21:RUSSIA TODAY VIDEO|Kirenko,Sergei, RUS’ new Mfuel&nrg, planned quick prv of Rosneft|Luk.crp.nrg was prv & far more cptable

<>1997de01:JPN (LCG) Japan’s third-largest electric utility said Friday that it now had the country’s biggest thermal power plant. Chubu Electric Power Co. said it had started up two 243 megawatt units at its Kawagoe plant near Tokyo, bringing the total capacity of the plant to a whopping 4,700 megawatts.

The Kawagoe power plant is fueled by liquefied natural gas. The company said it had no plans at this time to further increase the plant’s capacity. The new additions brought Chubu Electric’s total capacity to 30,310 megawatts.

<>1997de:naturalgas.com website:

WEUR: nrg.g use is forecast to increase in Europe

04.1% per year annualized, or

82.0% by 2010, in the Enron Outlook. This is due to:

(a) New gas supplies seeing markets in Europe from Russia, the UKi, NOR, NED, ALG and other sources

(b) Improving GNP growth in the 1994-2010 period versus the slow growth of the early 1990s

(c) enxal protection trends toward cleaner fuel use versus nrg.c and resid.

82.0% increase, led by growth in the UKi, GRM & ITL, equates to another

243.0bcM/y (8.60tcF/y) nrg.g demand growth by the year 2010. To assist in transporting this additional nrg.g,

60 ptpt prj~, representing

15,000m/24,000km of ptpt, are being planned to serve European markets.

The PaR: With strong inter-regional gas ptpt projects, continued growth in LNG trade and

GNP growth trends, as well as growing gas use for power plant fuel, Pacific Rim gas use increases

03.3% per year, or a

66.0% increase of

124.0bcM (4.40tcF), over the 1994 to 2010 time frame.

<>1997de01:RUSSIA TODAY VIDEO|GRM Chanc.Kohl,Helmut gt-MVA agrees to “Troika mtg” to “help counter” USA influence in EUR|The mtg will be in EKB, on suggestion of FRN prx Chirac,Jacques

<>1997de09:RUSSIA TODAY VIDEO|RUS & MXO may create orx outside OPEC|Nemtsov,Boris gt-MXO & discussed need for such a grp to defend INX, but MXO qin sd this not formal part of irx at this time

<>1997de16:RUSSIA TODAY VIDEO|RUS & TRK signed nrg.g trt worth ca.$13.5b|Ggzz.crp will tpt via 2 ptpt~: One exits across BAL rgn & 2nd one to be bdg under BLK.S|nrg.g tpt-TRK will reach

30bcM by 2010

<>1997de17:RUSSIA TODAY VIDEO|FRN Strasbourg|EUn recognized sct of RUS & CHN ekn~ as no longer “non-mkt”

<>1997de18:RUSSIA TODAY VIDEO|YlcB thanked Asia Pacific Economic Cooperation forum for admitting RUS

<>1997de19:RUSSIA TODAY VIDEO|Wbnk announced 2 $600m loans for RUS, one for structural rfm~ & other for nrg.c investment [NB! not for ptpt or nrg.g.zvd or the like]

<>1997de30:RUSSIA TODAY VIDEO|USA displeased w/new ptpt opened de29:TKM-IRN|996:USA lwx claims to be able to penalize any cmp investing more that $20m in IRN or LBY|Since ptpt opened now “predates the act” it is exempt,but USA will “monitor” further plans

 

 

 

 

<>1998:NDN Aceh ngr.p.ggr violence [W-ICE], eventually forced ExxM.crp.nrg pullout
*--Indigenous forces continued their 27-year effort to resist ExxM.crp.nrg [Coll.Private:394-407(ch18)]

<>1998:Bazhaev,Ziya otx Sidanko

<>1998:World Gas Yearbook for 1998:

The world natural gas industry and an assessment of production in Russia and the CIS - By Viakhirev,Rem Chairman of RAO Ggzz.crp, Moscow

What happened in 1996 and what is due for completion in 1997: a pictorial review

Technology: Messoyakh - the world's first operating gas hydrates field? - By Ginsburg,GD VNIIokeangeologia and Novozhilov,AA Norilskgazprom

Technology: Gas into liquid fuels

Evolution and development of the world's gas industry: a unique history of key dates and events, with selected photographs

Legal issues in the Russian and CIS oil and gas sectors, By Coudert Brothers, Moscow

Ggzz.crp's underground gas storage facilities - By Parfenov,VI RAO Gazprom

A special review of the last 50 years of the Russian gas industry: A unique history starting in 1947

A special report on the Russian gas industry written and prepared by the Chairman and Directors of RAO Ggzz.crp: Successfully integrating into the world gas market--Russia's contribution to building a new Europe. New trading laws help market in Ggzz.crp shares to evolve. Ggzz.crp's role in European gas. Advanced technology is the key to future success - LNG potential and exports - By Chairman Viakhirev,Rem and directors Semeniaka,AM Rezunenko,VI Komorov,YuriiA Remizov,VV

History of the LNG industry: From the very days in the 1930s to the development and construction of major plants in the Middle East - a unique study, with selected photographs

Nigeria: Pushing more into gas United Kingdom: Prospect of new policies on energy

China: Gas and power - By Michael Cannon, Price Waterhouse, Hongkong

Southern Europe: Italy, Spain. Portugal, Turkey, Greece - Gas demand set to double by 2010 - By Victoria Thomas, Petroleum Economist

Trinidad and Tobago: Construction of the first Trinidad-based LNG plant is underway - By David Renwick, Petroleum Economist

Italy: Pressure is on to seek diverse gas supply sources

North Africa: overview of oil & gas production

East Asia: A new market for Russian Gas - By Kazuya Fujime, Institute of Energy Economics, Japan

Russia: Use of natural gas for transportation - By Professor OB Bagrinskii,OB Bokserman,Yulii Kubikov,VB of the Russian Academy of Sciences and Energomash

Russia: Gas hydrates - meeting the challenge - By Istomin,VA & Yakushev,VS VNIIGAZ

South Korea: ever-increasing investment in LNG import terminals

Romania: Keen to increase its gas network

Slovakia: Now accounting for a quarter of energy needs

Gas in Asia: More emphasis on production

Natural gas glossary and terminology

Statistics: World gas production, consumption and rzv~

<>1998wi:BOOKMARK/ggr/C.ASA/CENTRAL ASIA (Focus Central Asia #2)|TRKeys New Trans-Caspian Project

A project for hydrocarbon tpt, separate from Russia and IRN (see photo on the cover), through the CSP.S from AZRan to TRKey was presented. This proposal was a primary issue in negotiations held in AWG between the TRKish Prime Minister, Mesut Iylmaz, and TKMan's President, [Niiazov,S].

The meeting confirmed the intentions of both countries to improve bilateral co-operation in different sectors of economy, especially in oil and gas. The parties have signed a block of the documents, including a memorandum on mutual understanding for the nrg.g ptpt through TKMistan-TRKey-EUR and a memorandum between the Turkish Oil Corporation (TOC) and the Authoritative Body on Use of Hydrocarbon of TKMistan. The latter document granted the right to the Turkish partner for exploration and extraction of hydrocarbons on the Amurdariya coast. In addition, agreements on co-operation for customs, tourism and environmental protection were signed.

The first official visit of IRNian President [Khatami,Mokhammad] to TKMan was not successful, but rather complimentary. Although the IRNian President attended an opening celebration of the TKMi-IRNan D.ptpt nrg.g, the parties have not signed an arranged memorandum on long-term co-operation in the nrg.p and gas sector. In a joint communique signed during the visit, a desire to develop wide-spread co-operation was briefly outlined.

Nevertheless, Teheran is confident that the route for TKMi nrg.g ptpt will go through TRKey and, probably, to EUR through IRN. Further development of this project was expressed in a letter signed in AWG by the ministers of oil and gas sectors of TKMistan, TRKey and IRN. This letter also charged the English-Dutch company Shell.crp.nrg to construct a nrg.g ptpt through TKMan, IRN, and TRKy.

Rtl #2 re. nrg.g

Gas

Russia Has Broken a Primary Trade Principle,

Thinks Saparmurat Niyazov

Discrepancies in the prices for TKMi gas were the stumble blocks in negotiations between the President of TKMistan, Saparmurat Niyazov, and the Prime Minister of Russia, QdnV.

This matter was discussed by the governmental delegations of the parties, which elaborated upon the project of agreement for the tpt of TKMi nrg.g by a Russian ptpt. As a result, the document was not signed. It was decided that prices for gas must be agreed on by March of this year before President Boris Yeltsin's visit to AWG.

According to President Saparmurat Niyazov after the governmental negotiations, RUS agreed:

1998:fxx

0025.0bcM nrg.g at $32 per 1000cM from the border area of TKMistan. AWG quoted another price, $41 per 1000cM & sd they would sell 30-40bcM nrg.g to UKR & EUR. During negotiations, RUS quoted price of $36 per 1000cM, which, however, did not suit the seller.

Niyazov sd AWG will insist on its price of $42 per 1000cM in the future. This was the price for TKMi gas in 1996-1997, when it was tpted by TRAO TKMrosgas. AWG is confident that this price will be profitable for RUS, who sells it to UKR at $80 per 1000cM.

Assuming that Russia pays $12 for the tpt of 1000cM within UZBistan and KZXan, the total price of TKMi gas for Russia will reach $54 per 1000cM. Moreover, TKMistan believes the method of payment (suggested by Russia) to be unprofitable: 30% of the gas price will be paid in currency and 70% in goods.

"Today, trade has to be civilised and profitable both for Russia and TKMistan," stated Niyazov. According to the President, this principle of mutual trade profitability is a major problem in economic co-operation between the CIS.

Ashgabad and Moscow have one matter left to be solved: the $107m debt payment of Russia to TKMistan.

1997au:RUS acknowledged $107m debt to AWG, when the official visit of the President of TKMistan to Moscow was held. After the collapse of the USSR, when Ashgabad agreed to nullify mutual debts, TKMistan used Russian roubles equalling $121m before issuing its own currency. Meanwhile, $228 million belonging to TKMistan was frozen in the Vnesh-econombank of USSR. Thus, a positive balance owed to TKMistan reached $107 million, which was later confirmed by Boris Yeltsin. During a meeting with Yeltsin, Saparmurat Niyazov suggested that Russia deliver goods to TKMistan, although the schedule for payments has not yet been agreed upon. Even though the parties agreed to solve the problem by autumn 1997, Ashgabad federal authorities believe that Russia delays its decision in order to put pressure upon TKMi officials while negotiating prices for gas.

A result of the visit of Chernomyrdin to Ashgabad was an agreement to cancel double taxation for income tax and property. The signatories of this document were the Deputy Minister of Economics and Finances of Russia, G. Kuznetzov, and the Minister of Economics and Finances of TKMistan, Matkarim Razhapov. No agreements for the mutual protection of investments and consular conventions were signed.

Chernomyrdin orally confirmed the intentions of Russia to take part in the construction of xpt ptpt from TKMistan-AFG-PAKan and TKMistan-IRN-TRKey-EUR

During the meeting, Niyazov and Chernomyrdin discussed the positions of both countries regarding the legal status of CSP.S.

At present, Ashgabad adheres to the position of dividing the CSP.S
 according to condominium principles, where a 45-mile area is left in the jurisdiction of each country with the remainder being neutral where countries can work on a priority basis. Both parties admitted the necessity to intensify the adoption of conventions concerning the legal status of the CSP.S
. The parties also agreed that any unilateral moves to develop sea rzv~ will be deemed unreasonable and each adopted decision in this connection must be agreed to by all Pri-Caspian countries. The parties decided that during the visit of Yeltsin to Ashgabad in the spring of this year, the legal status of the Caspian will be considered. In the meantime, the heads of all Pri-Caspian states will be invited to Ashgabad when the status of the CSP.S
 will most likely be determined.

It is necessary to note that, although Ashgabad and Moscow have similar positions on this matter, it is suitable for TKMistan to conduct sector divisions of the CSP.S
 as Baku insisted. In the opinion of Niyazov, "the CSP.S
 can be divided by sectors within a 45-mile area if all Pri-Caspian states agree. The rest should be neutral." One high-ranking official from the TKMi government did not exclude the possibility of changes in the TKMistan position related to the CSP.S
 status. Much will depend on the decision of AZR concerning the determination of a medium-line of the CSP.S
. At the end of January, a joint session of the TKM-AZR commission will be held.

On January 13, 1998, President Niyazov issued a decree. In accordance with this, an authoritative expert group for bilateral negotiations on the determination of a medium-line was created and ranges of jurisdiction for TKMistan and AZRan in the CSP.S
 were set up. The group consists of 11 representatives including Vice-Premier of the TKMi government, Batyr Sardzhaev, leaders from the Ministry of Oil and Gas Industry and Mineral Resources, the state corporation TKMgeologiya, the State Committee on Geodesy, Cartography and Land-Survey, the Ministry of Natural Use and Environmental Protection, Ministry of Internal Affairs, the State Committee on Fishery, the Chief Department of State Frontier Service, the TKMi Sea Steam-Navigation, and the Ministry of Justice.

According to foreign experts, the results of negotiations between Niyazov and QdnV confirmed the fact that today, TKMistan adheres to an independent position from Russia concerning {nrg.p & nrg.g ptpt} hydrocarbons tptation and the general development of the oil and gas sector. AWG does not regard xpt nrg.g routes as strategically important. Niyazov does not consider Russia a strategic partner for TKMistan and has sought-out alternative ways for hydrocarbon raw materials tptation to world markets. IRN is its primary confederate (where natural gas is delivered), in addition to TRKey and the USA, agitating Niyazov for a Trans-Caspian ptpt through the CSP.S and AZRan to TRKey and EUR.

Niyazov's position on negotiations with Yeltsin will depend primarily upon results of other meetings which will be held earlier. 998ja,e:UKR prx Kuchma,Leonid will visit Ashgabad. 998fe:TRKey prx, Suleiman Medirel, will visit. They are to discuss matters of natural gas delivery and construction of ptpt. 998fe:Official visit of Niyazov to the USA is planned.

WDC actively tries to persuade Ashgabad to improve its economic independence from Russia, especially in the nrg.p and nrg.g sector.

<>1998ja15:RUSSIA TODAY VIDEO|TKM & RUS failed to agree on prices for nrg.g tpt trt after 2d trv by QdnV

<>1998ja18:BBC News online|Wednesday, January 14, 1998 Published at 00:08 GMT

TKM leader: "Russia keen for ptpt deal"

The president of TKMan, [Niiazov,Saparmurat] has said Russia is keen to help build a new ptpt for TKM natural gas exports which will run through IRN to a port in Turkey.

Speaking after talks with the visiting Russian prime minister [QdnV], Mr Niyazov said intense negotiations were also continuing on resuming TKM gas supplies through Russia to Ukraine and Europe.

Mr Niyazov said Russia has also agreed to help construct a gas ptpt through AFGan to Pakistan.

Moscow stopped handling TKM gas last March because it was competing with Russian gas exports.

Before Mr Chernomyrdin's visit, President Niyazov told the Russian media that TKMistan wanted good relations with its southern neighbours, but not at the expense of ties with Russia.

<>1998ja14:RUSSIA TODAY VIDEO|RUS seeks to take part in 2 TKM nrg.g prj~|QdnV gt-AWG soon to discuss 2 ptpt prj~ at $1.6b, 940m ptpt via IRN to TRKey|Also discussing ptpt N via RUS ptpt~|RUS wants role in both directions

<>1998ja21:RUSSIA TODAY VIDEO|zpd spc~ debate whether merger of YUKOS nrg.p grp w/Sibneft co wld be cptabl|Would produce largest nrg.p producer zvder & xpter in RUS, third in wrl for output

<>1998ja23:RUSSIA TODAY VIDEO|Ggzz.crp & Luk.crp.nrg frmed consortium last year w/ Shell.crp.nrg to bid for stake in Rosneft Oil Co but now may not|Original stt plan was to auction 75% of Rosneft shares +1, but now sd 50% only

<>1998ja28:RUSSIA TODAY VIDEO|RUS United Energy Systems dtr~ (7 of 15) voted to otx-Bresnov,Boris (29yo) & replace him w/Diakov,Anatolii, but stt (w/ controling fxx in cmp) refused

<>1998ja21:TRK (LCG) Agreements were signed in Ankara yesterday for construction of two power plants in Turkey by two U.S.-led consortia. The agreements for the two deals, worth about $210m, were signed during a visit by U.S. Commerce Secretary William Daley who has been pressing for a larger USA share of Turkey’s planned $30b power expansion over the next 10 years.

The Commerce Department has identified Turkey as one of the world’s 10 most promising markets and Daley wants to make sure that U.S. companies participate. He is accompanied on his tour of Turkey, the Czech Republic and Greece by officials of about 25 U.S. corporations, including several energy firms.

Under one of the accords signed yesterday, U.S. company TAD LLC, along with Turkish partners, will develop a $163.5 million natural gas-fired project in Elkisehir in central Turkey. In the other deal, worth $46.5 million, Ormat International of the U.S. and its Turkish partners will develop a geothermal plant in Aydin in southwestern Turkey.

The Turkish government has said it plans to first modernize and then privatize several existing power plants. U.S. companies will be among the bidders on those projects, both for construction and to take the plants over and operate them.

<>1998fe05:RUSSIA TODAY VIDEO|ARM decided to take hardline on N-K|Same day, Ggzz.crp affirmed intention to make deal w/IRN to dev IRN S.Pars nrg.g.ggr,working w/FRN cmp Total SA & Malaysian Petronas|USA lwx says WDC may impose sanctions vs cmp~ which invest more than $20m in IRN nrg.p or nrg.g

<>1998fe27:RUSSIA TODAY VIDEO|MOL to give ½ of nrg.g ptpt system to Ggzz.crp to pay $650m debt for nrg deliveries|Further strengthens Ggzz.crp “chokehold” on nrg.g tpt in former SSR

<>1998mr02:TRK

TYPE=CORRESPONDENT REPORT
NUMBER=2-227455
TITLE=TURKEY/CASPIAN (L-ONLY)
BYLINE=AMBERIN ZAMAN
DATELINE=ANKARA

CONTENT=

VOICED AT:

INTRO: TURKEY HAS FAILED TO SECURE A FIRM COMMITMENT FROM STATES BORDERING THE CSP.S
 TO EXPORT OIL AND NATURAL GAS TO WESTERN MARKETS VIA TURKEY. IN A JOINT DECLARATION ISSUED MONDAY AT THE END OF A TWO-DAY CONFERENCE IN ISTANBUL, THE FOREIGN MINISTERS OF TURKEY, KAZAKHSTAN, TKMISTAN, GEORGIA, AND THE DEPUTY FOREIGN MINISTER OF AZR EMPHASIZED THE NEED FOR SEVERAL PIPELINES TO EXPORT CASPIAN OIL AND NATURAL GAS. BUT AS AMBERIN ZAMAN REPORTS, THEY DID NOT SINGLE OUT TURKEY AS THE MAIN EXPORT ROUTE.

TEXT: FOR ANKARA, THE OUTCOME OF THE TWO-DAY CONFERENCE IN ISTANBUL FELL SHORT OF ITS EXPECTATIONS -- THAT IS, TO GET THE PARTICIPANTS TO AGREE ON SINGLING-OUT TURKEY AS THE MOST DESIRABLE EXPORT ROUTE FOR CASPIAN OIL AND NATURAL GAS.

TURKEY HAS BEEN WAGING AN AGGRESSIVE DIPLOMATIC CAMPAIGN TO PERSUADE CENTRAL ASIAN MUSLIM STATES OF THE FORMER SOVIET UNION, ALONG WITH NEIGHBORING AZR, TO EXPORT THE BULK OF ITS VAST OIL AND NATURAL GAS rzv~ THROUGH A PROPOSED PIPELINE NETWORK [CYN.ptpt] RUNNING FROM THE AZRI CAPITAL BAKU TO LOADING TERMINALS AT THE PORT OF CEYHAN ON THE TURKISH MEDITERRANEAN COAST.

BUT TURKEY HAS ENCOUNTERED STIFF OPPOSITION FROM RUSSIA -- ITS REGIONAL RIVAL. RUSSIA REMAINS THE MAIN OUTLET FOR CENTRAL ASIAN AND AZRI OIL AND GAS EXPORTS, FLOWING THROUGH A NETWORK DATING BACK FROM SOVIET TIMES. ANALYSTS SAY MOSCOW FEARS ITS INFLUENCE OVER ITS FORMER DOMINIONS WILL DIMINISH, SHOULD THEY CHOOSE ALTERNATIVE ROUTES TO EXPORT THEIR VAST ENERGY rzv~ WHICH ARE ESTIMATED TO RIVAL THOSE OF THE MIDDLE EAST.

THE UNITED STATES IS ENCOURAGING WHAT ITS OFFICIALS DESCRIBE AS A "MULTIPLE PIPELINE STRATEGY." THEY ARGUE THAT BY DIVERSIFYING EXPORT OPTIONS, THE FORMER SOVIET STATES WILL FURTHER CONSOLIDATE THEIR INDEPENDENCE. WASHINGTON, THEREFORE, CONTINUES TO STRONGLY SUPPORT THE CONSTRUCTION OF THE PROPOSED BAKU-CEYHAN ROUTE AS PART OF THAT STRATEGY.

BUT ANALYSTS SAY THAT THE OIL EXPORTING COUNTRIES THEMSELVES NEED TO BE PERSUADED OF THE MERITS OF ANY PIPELINE ROUTE THAT RUSSIA OPPOSES. THEY POINT OUT THAT KAZAKHSTAN, IN PARTICULAR, APPEARS RELUCTANT TO UPSET MOSCOW. THE KAZAKH FOREIGN MINISTER TOLD THE ISTANBUL CONFERENCE THAT THE BAKU-CEYHAN ROUTE WAS, IN HIS WORDS, "COSTLY AND COMPLICATED" AND THAT HIS COUNTRY WANTED TO EXPORT ITS CRUDE OIL THROUGH A PROPOSED PIPELINE RUNNING TO RUSSIA'S BLACK SEA PORT OF NVR.

//REST OPT// FOR NOW, THE BULK OF OIL PRODUCED IN RUSSIA AND THE FORMER SOVIET STATES IS TRANSPORTED BY TANKERS WHICH USE TURKEY'S BOSPHORUS AND DARDANELLES STRAITS TO REACH FOREIGN MARKETS.

CITING ENVIRONMENTAL AND SAFETY CONCERNS, ANKARA SAYS THAT THE STRAITS CANNOT HANDLE THE EXPECTED INCREASE IN TANKER TRAFFIC, ONCE COUNTRIES LIKE KAZAKHSTAN AND AZR START PRODUCING MORE OIL. RUSSIA, IN TURN, ARGUES THAT SHOULD TURKEY TRY TO LIMIT TANKER TRAFFIC THROUGH THE STRAITS, IT WOULD BE VIOLATING THE 1936 MONTREUX CONVENTION WHICH GUARANTEES FREE PASSAGE OF ALL COMMERCIAL TRAFFIC THROUGH THE STRAITS.

AGAINST THIS BACKGROUND, ANALYSTS SAY TURKEY WILL HAVE TO DO A LOT MORE CAMPAIGNING BEFORE IT CAN FULFILL ITS LONG-CHERISHED GOAL OF BECOMING THE MAIN TRANSIT ROUTE FOR CASPIAN OIL AND NATURAL GAS. THEY ADD THAT THE ISTANBUL CONFERENCE IS A POSITIVE STEP IN THAT DIRECTION. (SIGNED)

NEB/AZ/PCF 02-Mar-98 10:26 AM EST (1526 UTC) Source: Voice of America

<>1998mr04:RUSSIA TODAY VIDEO| nrg.a chief (since 1992) Mikhailov,Viktor otx- by YlcB|At time of ISR Mtrd&mfg Sharanskii,Natan gt-MVA & questioned RUS~~IRN|Same time:RUS expressed surprise at being excluded in weekend talks in IST on CSP.S nrg.p xpt~| TRK qin mtg w/ rpz of AZR GRZ KZX & TKM to discuss CYN.ptpt to tpt nrg.p BAKU-AZR-TRK CYN for xpt to zpd

<>1998mr06:RUSSIA TODAY VIDEO|Chubais,Anatolii crt “crony capitalism”,obviously meaning Berezovskii,Boris and his tnx, stt~~ cmp~|JPN announced support for RUS mmbip in WTO

<>1998mr12:RUSSIA TODAY VIDEO|Yesterday WDC vprx Gore-QdnV mtg|Luk.crp.nrg signed deal w/ Conoco to dev nrg.p & nrg.g|Boeing will buy $200m titanium frm RUS|AGCO will sell $60m skz mkh to Chelyabinsk rgn

<>1998mr15:RUSSIA TODAY VIDEO (98ja26)|Planned RUS-KZX agreement on CSP.S, w/o which “eknic and urgent ecxal tasks” cannot be solved

<>1998mr17:RUSSIA TODAY VIDEO|SIDANKO team leaving company|Bazhaev,Ziya said he & apx teamwill start own firm

<>1998mr18:GRM electric engineering giant Siemens AG posted record sales of DM 1.2b for 1996FY [RUSSIA TODAY VIDEO]

<>1998mr17:RUSSIA TODAY VIDEO (98ja23)|Planned “Troika mtg”:RUS GRM & FRN in EKB

<>1998ap06:Kirienko,Sergei already feels pressure frm cpt “tycoons” [RUSSIA TODAY VIDEO]

<>1998ap07:Reuters| www| "Markets Will Wait For Ggzz.crp ADRs"| COMBINED REPORTS =

SLONIM, Belarus - Russia's natural gas monopoly Ggzz.crp will wait at least six to seven months before selling the next tranche of its American Depositary Receipts, said [Viakhirev,Rem] the company's president.

Vyakhirev, speaking at a ceremony Wednesday to open a section of a natural gas ptpt that will bring Russian supplies to Europe via the former Soviet republic of Belarus, said that the market price of Ggzz.crp shares was too low.

"Political instability in Russia has affected the shares, and for investors, the price of instability is important," he said.

A Ggzz.crp official who declined to be identified said that Ggzz.crp would seek to sell its shares at a price three to four times higher next time around, with each share commanding a price of no less than $5.

Ggzz.crp American Depositary Receipts, or ADRs, were quoted at $19.475 at midday in London, off highs of $19.825 but above Tuesday's close of $18.50.

Each ADR, which represents 10 underlying shares, was initially priced at $15.75 late on Monday.

ADRs, which must meet specifications of the USA Securities and Exchange Commission, allow foreign investors to buy dollar-denominated shares in Russian companies while avoiding Russia's cumbersome custodial and settlement system.

Vyakhirev said that the London Stock Exchange was scheduled to start trading the paper on Oct. 28.

The ADR issue of 1% of the firm's total stock was originally valued at $373.3 million by Ggzz.crp. The initial placement of stock was five times oversubscribed at the offer price and Ggzz.crp is considering putting a further 0.15% of its stock on sale to satisfy demand.

The ptpt section on which work started Wednesday is a small but key part of Ggzz.crp's ambitious, $40b Yamal-Europe project.

The project, when fully complete, will carry huge supplies of Russian gas from the Yamal Peninsula in the Arctic to Germany and beyond via Belarus and Poland.

Yamal aims to double Russia's gas xpt~ to Europe by 2010 via a vast, 4,107-kilometer ptpt network.

"In four to five years the Yamal-Europe gas ptpt will unite Europe's entire energy system from Poland to Spain," Vyakhirev said.

<>1998ap09:PUBLICATION:     RUSSIA TODAY VIDEO NEWS TRANSCRIPT | HOMEPAGE:     http://www.russiatoday.com

THOUSANDS OF RUSSIANS JOIN IN NATIONAL DAY OF PROTEST

Thousands of workers took to the streets in Russia's Far East on Thursday as part of a nation-wide day of protest. About 4,000 people marched in Vladivostok, although early reports suggest that many workers have chosen to stay home. Things turned political in the Far East, as demonstrators called for Yeltsin to resign and supported a Communist demand for a coalition government. Labor leaders, who have come out in support of Yeltsin's nominee for prime minister, Kirienko,Sergei had asked that the protests remain non-political, focusing on the nonpayment issue. For more on the nation-wide day of protest, see Russia Today's top stories.

LABOR THROWS ITS SUPPORT BEHIND KIRIYENKO

The backing of labor leaders is seen as a good sign for Kiriyenko, but it still seems unlikely he will be approved by the Duma on the first vote. The acting prime minister will present his plan for the economy to Duma deputies on Friday, after which they are expected to hold the first of what could potentially be three votes. Communist leader Gennady Zyuganov continues to oppose Kiriyenko and will seek a change in the voting rules to avoid a secret ballot on Friday. Yeltsin's own representative in the lower house, Aleksandr Kotenkov, has admitted it is unlikely Kirienko will be approved this week.

YELTSIN TO VISIT CHERNOMYRDIN ON FORMER PM'S 60TH

Russian President Boris Yeltsin is expected to visit former Prime Minister Victor Chernomyrdin on Thursday for Chernomyrdin's 60th birthday. The president sacked the premier last month, after criticizing him for failing to solve the country's wage arrears crisis. Chernomyrdin has announced his intention to run for president and received only lukewarm support from Yeltsin. On Tuesday, however, Russian media and financial tycoon Boris Berezovsky advised the Russian business community to support Chernomyrdin in 2000.

LUKOIL, MOSCOW DEAL CREATES MAJOR NEW OIL SECTOR PLAYER

An agreement signed in Moscow on Wednesday has created an important new player in the Russian oil industry. The deal was inked by Moscow Mayor Yury Luzhkov and the president of LUKoil. Also in attendance were the President of the oil-rich Tatarstan region, the head of the region's Tatneft oil company and the head of the Central Fuel Company. The five have not formed an official consortium, but Tatarstan and LUKoil have each bought 13% of the Central Fuel Company, of which the City of Moscow already owns 38%.

 

 

<>1999de:Kyoto Protocols signed
*--ExxM.crp.nrg worked strenuously to neutralize these Protocols
*--ExxM.crp.nrg CEO Raymond,Lee led effort to deceive the world about a scientific critique of Kyoto, signed by many thousand "scientists" [Coll.Private:80-9]

 

Chronology (21st century)

*2000:USA-RUS espionage employed “top spy” Sergei Tret’iakov [TtkSrg] as a double agent until this year when he defected to USA
*1995:2000; TtkSrg was deputy head of UNO mission| He told story about how his agents helped the RUS gvt “steal nearly $500 million from the UNO’s oil-for-food program in IRQ before the fall of Saddam Hussein in 2003”| TtkSrg “oversaw an operation that helped Saddam’s regime manipulate the price of Iraqi oil sold under the program -- and allow Russia to skim profits [2008ja27:ERG story with these and other sensational claims was occasioned by the publication of TtkSrg’s book at this time| Hard to justify ERG headline = RUSSIA FINGERED IN OIL-FOR-FOOD SCAM]

*2000ap06:IREX is pleased to welcome Mr. Franz B. Ehrhardt, Dr. Sarah Pratt, and Mr. Kurt A. Wimmer as new members of its Board of Governors.

Mr. Franz B. Ehrhardt is President and Managing Director of Conoco EurAsia Inc., located in Istanbul, Turkey. His responsibilities include the coordination and the development of Conoco's entire range of energy interests in the EurAsia Region.

He has held various positions including General Manager of Marketing, Conoco Germany, Coordinator Worldwide Marketing, President of Conoco's US Retail Marketing Company, Managing Director of DuPont Scandinavia, and Executive Management Consultant for New Business in Asia. A multilingual native German, he completed his education in Mining Engineering and Business Administration in Germany, as well as at the Harvard Business School. His total career in the oil industry spans over 40 years.

Mr. Ehrhardt has been very actively involved in the world of Applied Creative Thinking. He served on Dupont's Advisory Board for Creativity and Innovation, he is a member of the board of the American Creativity Association, and he is a certified instructor of various creative and provocative thinking concepts. During his entire career, he has very successfully applied creative thinking techniques.

Additionally, he has a very close association with academia. This includes service on the development and advisory boards of a number of universities. Mr. Ehrhardt had various teaching assignments as executive in residence, visiting professor, and adjunct professor. His lecturing activities included many different countries.

Mr. Ehrhardt joined the IREX Board in fall 1999 and has been instrumental in working with staff on Caspian and Black Sea initiatives.

*2000au24:NOR, STAVANGER | Gazprom Flexible on European Pipeline Plans -- (Reuters) Russian giant Gazprom , which sits on approximately one quarter of the world's natural gas rzv~, is in no rush to build new ptpt~ to fill "overestimated" European demand, a company executive said on Thursday.

"If there will be bigger demand, we'll construct it. If not, we'll wait. We're not in a hurry," Gazprom board member Yuri Komarov told Reuters on the sidelines of the Offshore Northern Seas conference.

"It is not clear when the time will come. The market forecast for gas consumption in Europe was overestimated."

PIPELINE PLANS COMPETE

Gazprom has set several potential ptpt projects in motion in order to diversify its route of supplying gas to western Europe, which depends on Russia for about 25 percent of its demand.

Currently, 90 percent of deliveries are shipped through the Ukraine, but Kiev owes Russia billions in back energy debts. "Unfortunately they're not a reliable transporter," said Komarov.

The most distant planned alternative route crosses the Baltic Sea with help from Finland's Fortum at an estimated cost of about USD 10 billion. But it remains at least 10 years off, according to the Finnish company.

Poland offers good access and plans are underway to complete the Yamal ptpt, half of which was finished last year with a capacity of about 32 billion.

Another proposal is to extend the Yamal with a southern link to serve Slovak and Czech customers, an idea Poland has rejected, citing potential damage to its relations with Ukraine. But Komarov said that in the end, economics would dictate which plan prevails.

"There are competing projects. The one that gives us better conditions will be built. This is quite important to Poland as well, as they will get funds from the transport," he said.

One project that now seems certain is the so-called "Blue Stream" ptpt that will send gas beneath the Black Sea to Turkey. Gazprom is building the 16 billion cubic meter capacity pipe with Italy's ENI. "Next year we will start deliveries. We have already started construction."

NO SHAKE-UP SEEN

Komarov said he did not expect the Russian government to seek a major shake-up of one of its key cash cows, even as the Kremlin moves to rein in some of the oligarchs that control much of the nation's industry.

"I can't imagine any big changes... We bring in a lot of profits. For sure the government wants to keep the company in good health," he said. Gazprom is always seeking efficiency, but will remain a vertically integrated monopoly, he added.

Plans to end restrictions on foreign ownership of Moscow-listed Gazprom shares - tearing down the fence that separates them from the ADRs, considered a major touchstone - are under evaluation but depend on "many subjects", Komarov said.

He also sees no need to reevaluate the company's relationship with Itera, a transporter and distributor in many of the ex-Soviet states. Some analysts fear Gazprom value is being transferred to Itera.

"We have only a business relationship. They serve a very complicated client market, it's not a usual business from the Western point of view," said Komarov. "It's clear that Gazprom couldn't manage the market alone."

(C)2000 Copyright Reuters Limited. All rights reserved. Republication or redissemination of the contents of this screen are expressly prohibited without the prior written consent of Reuters Limited.

<>2000au28:DOLINSK, Russia, Aug 28, 2000 -- Soviet Dreams Shattered in Russia's Far East (Agence France Presse) Anger was palpable Sunday among the unemployed in this bare and forgotten town once meant to be the oil capital of Russia's Far East, but now a frightening show of Soviet miscalculation.

Forty kilometers (25 miles) north of [>YSXL] Yuzhno-Sakhalinsk, the capital of Russia's oil-rich SXL Island lies, many here agree, a dead zone which people would prefer to escape, if they could.

Unemployment is rife among the young, while many of those with any job at all are paid trivial salary months late -- if ever.

"1993 was the end, that was when they put a gravestone on this town," said 30-year-old army sergeant Alexander Mirnov, his lips trembling as he spoke.

"Ten years ago you could still get out of here, now we're stuck for good," he added despairingly.

In Communist times, wind-swept Dolinsk was actually an attractive place to live, drawing enthusiasts from all over the Soviet Union with promises of rich pay checks from a giant cellulose plant.

A small town nestling among olive-green hills, waves pleasantly lap against the shore at Dolinsk, on the Sea of Okhotsk coast.

But now its ugly concrete Soviet-era buildings are a prison for the unhappy 15,000 residents, desperately trying to make ends meet.

"We're not living, we're surviving," said Roman, 50, who spent two decades working together with his wife in the Celulosny Bumagny Kombinat.

Money from SXL's oil and mineral resources seems to flow into the coffers of Western multinationals and Russian oil majors in boomtown Moscow -- instead of being ploughed back into the impoverished island, locals insist.

"We could be another KWT. We have oil, gas, fish and coal, but what benefits do we ever see from this?" demanded Nina Ivanovna, 41, who held a senior post in the cellulose plant.

In 1991, just after the Soviet Union collapsed, a large Japanese firm offered to buy the factory, she said, but was turned down by the government in Moscow.

At the entrance to the abandoned site, a tired notice board still proudly proclaims how the plant, founded by a Japanese company in 1917, was reclaimed in 1945, when the Soviets seized SXL.

It then shows production plans being fulfilled as output rises inexorably, reaching 82,000 tons in 1990 from 14,000 tons in 1946, with exports going to China, Vietnam and North Korea.

But suddenly, the picture is subverted as graphs illustrating a steady rising line suddenly plunge towards zero -- a mere 2,100 tons by 1995.

An eerie silence envelops the chimneys and tall factory buildings where once nearly 2,000 workers congregated every day. "Peace. Work", the slogan written on a wall proclaims mockingly.

Ivanovna, a senior worker at the coal-fired power station that provides the town with heating, said she had not been paid properly for several years.

She is still owed RUR 35,000 (USD 1,250, EUR 1,400), about one year's pay.

"Last year I went to Moscow, I saw how they've spruced the place up. But living here I can't even buy a coat for winter," she said.

Valentina, a toothless 50-year-old still employed to guard the factory entrance, listlessly peeled potatoes as she boiled some tea in her tiny cabin.

Taken on at the plant when she was 18, she said she hadn't received any salary for the past three years. Instead she is given milk and bread.

Yet the worst anxiety for all is that the next generation will be trapped in this same life.

"Our 19-year-old son is coming back from his army service. What is he going to do? He wanted to be a computer programmer but we can't afford to pay for him to study," one mother said, betraying little hope. ((c) 2000 Agence France Presse)

<>2000de15:MVA -- (Agence France Presse) Russian President Vladimir Putin's representative for the CSP.S
, Viktor Kalyuzhny [Kaliuzhnyi,Viktor], held "amicable and constructive" talks with visiting IRNian counterpart Ali Akhani Thursday, Interfax reported.

Talks between the two men focused on next year's five-nation Caspian meeting of deputy foreign ministers from AZR, IRN, KZX, RUS and TKM to be held in Tehran.

"Today, we set a deadline for the summit," Kalyuzhny told the news agency, adding that the meeting would take place at the end of January or beginning of February [2001ja: or 2001fe:].

IRN had postponed the international summit several times citing disagreements between the five countries on the future status of the CSP.S
.

"Significant progress was made during our meeting and Akhani confirmed IRN's readiness to take part in multilateral consultations on the Caspian problem," said Kalyuzhny.

He also said that Tehran had supported Moscow's proposal to tie regulation of the CSP.S
 to shipping and the support of bio-resources.

The CSP.S
's hydrocarbon resources, considered the world's richest after those of the PER.G and SBR, are the object of fierce rivalry between the five states.

The division of the Caspian's waters has never been formally clarified, with the result that the rival nations continue to dispute the share-out and exploitation of its natural resources.

In the past, IRN has accused AZR of being too friendly to the United States and Israel because of its success in securing a number of major energy contracts with foreign firms since the breakup of the Soviet Union.

The planned summit could play "a major role in concluding efforts to define the (legal) status of the CSP.S
," Russian Foreign Minister Igor Ivanov said earlier.

The head of the Russian parliamentary defense committee, Andrei Nikolayev, said last week after a meeting with IRN's ambassador to Moscow, Mehdi Safari, that IRN was also considering allowing Russia access to the NDN.O, ITAR-TASS reported.

Russian Defense Minister Igor Sergeyev is planning to travel to Tehran in late December or early January to discuss military cooperation projects estimated at some seven billion dollars, the news agency said.

Moscow announced last month it was scrapping a five-year-old agreement with Washington that banned conventional arms sales to IRN, a decision that prompted a White House warning that trade ties could suffer as a result. ((c) 2000 Agence France Presse)

<>2000de15:KZX Almaty| See website favorite dms: Transcaspian Project. During his speech in the Kazakh parliament a few days ago, the president of the National petroleum company (NPC) "Kazakhoil" Nurlan Balgimbayev focused on questions of financial-economic activities concerning his company, particularly, on policy distributing NPC "Kazakhoil" dividends, pricing and sale of petroleum in the region with a preferential mode of taxation (offshore), and on problems of providing the home market with petroleum.

Taking into account, that the world market prices are variable, the company conducts a policy of maximum usage of favorable conjuncture for financing the programs for recovering the main production assets, increasing oil recovery, realizing indispensable volumes of hole cutting.

In case if oil extracting continues without investments (at withdrawal of the dividends), "Kazakhoil" forecasts that by 2005 the production of petroleum is to decrease from 5,7 million Tons in the current year down to 1,9 million Tons (more than in 3 times comparing to the level of 2000), has declared Nurlan Balgimbayev.

When the company was created, the production facilities of the oil producing enterprises were, to put it mildly, in a worn state. In conditions when the world prices on petroleum were falling down in 1998 and beginning of 1999, when the price has gone down to 9-10 dollars for barrel, the company was compelled to reduce the investments on major repairs of its basic funds. Therefore, "Kazakhoil" considers its primary objective to recover its industrial power.

The statement of official structures about short-reception of money due to sale of raw material undercharged to petroleum companies, among which "Kazakhoil", is not true in opinion of the NPC experts. Taking into account the transport costs, the difference between the adopted "world price" index and the true selling price of petroleum is around 40-50 dollars for ton.

Speaking about the sale of Kazakh petroleum to companies registered in Offshore zones, the experts mark that during the sale of petroleum for export, the sales contracts are concluded consist only with solvent companies capable to purchase hydrocarbon according to international price. The registration in offshore zones is determined by the fiscal policy of the buyer and has nothing to do with the fiscal structures of the exporting country, in this case - Kazakhstan.

Nurlan Balgimbayev is convinced, that NPC "Kazakhoil" completely manages its obligations on loading Kazakhstan refinery. The fulfilling of the obligations to deliver petroleum for the home market makes today about 107 percent from the plan affirmed by the Ministry of energy, industry and trade.

Being an operator of 18 percent of the petroleum, extracted in the republic, "Kazakhoil" plans to deliver Kazakhstan refinery 1.9 million tons of petroleum in by the end of this year. It makes approximately 28 percent from the total amount of deliveries to home market by all the oil producing enterprises in the republic.

 

<>2001ja:USA prx Bw2 [plt.irx] created special taskforce on USA energy policy as central component of foreign relations

<>2001se11:NYC World Trade Center, the WDC Ptg and other sites targeted for coordinated Al Qaeda terrorist attacks in the form of suicidal (and murderous) "kama kazi" aerial crashes
*--Bw2 administration officials diverted their attentions from this and quickly took up their long-term ambition = attacking IRQ [M.crn]

<>2001oc11: A subject that I hear has been on your mind. (email from Bob Arnold)

SOURCE=

MISSING THE OIL STORY | AUDIO and TEXT| Nina Burleigh has written for The Washington Post, The Chicago Tribune, and New York magazine. As a reporter for TIME, she was among the first American journalists to enter IRQ after the Gulf War. Her words =

Recently I attended one of those legendary Washington dinner parties, attended by British cosmopolites and Americans in the know. A few courses in, people were gossiping about the Bush family's close and enduring friendship with the SaA ambassador, Prince Bandar, dean of the diplomatic corps in Washington. By the end of the evening, everyone was talking about how the unfolding events were going to affect the flow of oil out of Central Asia.

I left wondering whether 6,000 Americans might prove to have died in New York for the royal family of Saud, or oil, or both. But I didn't have much more than insider dinner gossip to go on. I get my analysis from the standard all-American news outlets. And they've been too focused on a) anthrax and smallpox, or b) the intricacies of Muslim fanaticism, to throw any reporters at the murky ways in which international oil politics and its big players have a stake in what's unfolding.

A quick Nexis search brought up a raft of interesting leads that would keep me busy for 10 years if the economics of this war was my beat. But only two articles in the American media since September 11 have tried to describe how Big Oil might benefit from a cleanup of terrorists and other anti-American elements in the Central Asia region. One was by James Ridgeway of the Village Voice. The other was by a Hearst writer based in Paris and it was picked up only in the San Francisco Chronicle.

In other words, only the Left is connecting the dots of what the Russians have called "The Great Game" [?] -- how oil underneath the 'stans' fits into the new world order. Here's just a small slice of what ought to provoke deeper research by American reporters with resources and talent.

Start with father Bush. [ BshGH & Crl.grp] The former president and ex-CIA director is not unemployed these days. He's been globe trotting as a member of Washington's Carlyle Group, a $12 billion private equity firm which employs a motorcade of former ranking Republicans, including Frank Carlucci, Jim Baker and Richard Darman. BshGH senior and colleagues open doors overseasfor The Carlyle Group's "access capitalists."

Bush specializes in Asia and has been in and out of SaA and KWT (countries that revere him thanks to the Gulf War) often on business since his presidency. Baker, the pin-striped midwife of 'Election 2000' was working his network in the 'stans' before the ink was dry on Clinton's first inaugural address. The Bin Laden family (presumably the friendly wing) is also invested in Carlyle. Carlyle's portfolio is heavy in defense and telecommunications firms, although it has other holdings including food and bottling companies.

The Carlyle connection means that George Bush Senior is on the payroll from private interests that have defense business before the government, while his son is president. Hmmm. As Charles Lewis of the Washington-based Center for Public Integrity has put it, "in a really peculiar way, BshGW could, some day, benefit financially from his own administration's decisions, through his father's investments. And that to me is a jaw-dropper."

Why can we assume that global businessmen [tntn.ekn] like Bush Senior and

Jim Baker care about who runs AFG and NOT just because it's home base for lethal anti-Americans? Because it also happens to be situated in the middle of that perennial vital national interest -- a region with abundant oil. By 2050,Central Asia will account for more than 80 percent of our oil

2001se10:O&G, an industry publication,reported that Central Asia represents one of the world's last great frontiers for geological survey and analysis, "offering opportunities for investment in the discovery, production, transportation, and refining of enormous quantities of oil and gas resources."

It's assumed we need unimpeded access in the 'stans' for our geologists, construction workers and ptpt~ if we are going to realize the conservation-free [enx.c], fsl-fueled future outlined recently by Vice President Cheney. A number of ptpt projects to carry Central Asia's resources west are already under way or have been proposed. They would go through Russia,through the Caucasus or via Turkey and IRN. Each route will be within easy reach of the Taliban's thugs and could be made much safer by an American vanquishment of Muslim terrorism.

There's also lots of oil beneath the turf of our politically precarious newest best friend, Pakistan. "Massive untapped gas rzv~ are believed to be lying beneath Pakistan's remotest deserts, but they are being held hostage by armed tribal groups demanding a better deal from the central government," reported Agence France Presse just days before September 11.

So many business deals, so much oil, all those big players with powerful connections to the Bush administration. It doesn't add up to a conspiracy theory. But it does mean there is a significant MONEY subtext that the American public ought to know about as "Operation Enduring Freedom" blasts new holes where ptpt~ might someday be buried.

This is Nina Burleigh for TomPaine.com.
Web sites related to this article: Center for Public Integrity
Copyright 1999-2001 The Florence Fund

 

<>2002ja29:WDC| prx Bw2 "State of the Union" adx declared that IRQ, Iran & NKOR represented an "axis of evil"

<>2002fe27:RFE/RL Caucasus: Will Russia's LUKoil Join The Baku-CYN Pipeline Project? [CYN.ptpt.prj] By Michael Lelyveld

While Russia's LUKoil prepares to take a stake in the Baku-CYN.ptpt in March, the Russian government has yet to give its public approval for the deal. Moscow may have tacitly allowed negotiations to go ahead, but some officials are making it clear that they still oppose the move.

Boston, 27 February 2002 (RFE/RL) -- Even with a deal in the works, Russia continues to send mixed signals about whether it will join in sponsoring the Baku-CYN.ptpt, raising questions about Moscow's strategy for the U.S.-backed project.

Russian support for the ptpt from AZR's Caspian oil fields through Georgia to Turkey's Mediterranean port of CYN would mark a major turning point in cooperation between the two powers.

So far, there has been no official word from the Russian government about whether it will approve participation of Russian oil companies in the
$2.75b
project, which is due to start construction in June.

As the weeks pass and the deadline approaches, Moscow's silence may soon be taken for acquiescence that Russian companies are free to pursue their interests in a plan that it once fiercely opposed.

Talks with at least one Russian company appear to be in final stages. The president of AZR's state oil company SOCAR, Natik Aliev, said that LUKoil is likely to sign an agreement for a share in the ptpt in March.

The Interfax news agency quoted Aliev as saying, "We are satisfied with the pace of negotiations with Lukoil for the company to join the sponsorship group for the project to build the export ptpt."

On 25 February, the head of LUKoil operations in AZR, Fikrat Aliev, confirmed that Russia's largest oil company plans to buy a share of 7.5-8 percent of the project from SOCAR, the Turan news agency said. LUKoil's president, Vagit Alekperov, spoke in similar terms in January.

But the latest statement from a Russian government official still leaves room for uncertainty. Speaking recently in Moscow, Russia's Caspian envoy, Deputy Foreign Minister Viktor Kalyuzhny, said that he "personally, as a Russian citizen, is against the construction of this ptpt," according to Interfax.

On the one hand, the wording might mean that although the government has given its tacit assent, Kalyuzhny continues to oppose the ptpt as a private matter. It might also mean that the decision has yet to be made, and Kalyuzhny is arguing against it in the public interest.

Although the official position is unclear, Kalyuzhny seemed to leave no doubt where he stands on the question of any non-Russian development in the region. Interfax quoted him as saying, "The Caspian belongs to the Russian market."

Such sentiments were widespread when AZR announced its first offshore development with foreign partners in 1994, but they have slowly faded with the recognition that CIS nations have the right to pursue their own course.

Similarly, LUKoil … stress in the past that it would join the Baku-CYN.ptpt.prj only with approval from the government, which owns 15.5 percent of its shares. But in recent weeks, that cautionary note has also gradually vanished from reports on the talks.

Even so, Kalyuzhny's comment on Russian control of the Caspian may be a sign of the fallout that President Vladimir Putin will face if he formally announces support for Baku-CYN. The political resistance may account for the long lag in acknowledging that negotiations are well under way.

More curious is the resistance to the project on economic grounds. Since last year, Kalyuzhny and other Russian officials have argued that Baku-CYN is not "economically viable," instead of attacking it for political reasons.

The concerns include questions about whether the ptpt will attract enough oil to fill its capacity of 1 million barrels per day. Some of the arguments are self-fulfilling, in light of the fact that Russia can influence transport decisions, both with its own oil companies and those of neighboring Kazakhstan.

In December, LUKoil said a new study by Britain's BP oil company had found that the ptpt's profitability would be 24-24.5 percent, a margin that might be more than enough to silence the official critics. BP is the operator of the project and leader of the sponsorship group. Yet, the questions have not only come from officials.

Two weeks ago, the chief executive of Russia's second-biggest oil company, Yukos, sent his own mixed message on the ptpt project. Mikhail Khodorkovskii told the Reuters news agency: "Personally, I am for the Baku-CYN.ptpt. In recent times, the Russian government has looked somewhat more favorably on this project." Yukos has reportedly been considering a 12.5 percent stake in the project.

But Khodorkovskii added, "I am not convinced of the economic soundness of the Baku-CYN ptpt." In other words, unlike Kalyuzhny, Khodorkovskii favors the route personally and politically. But he has the same doubts about the economics. This appears to be where logic breaks down.

Despite the repeated questioning about economic viability, there is a more basic question that has yet to be addressed. Why would BP invest in a project if it was not economically viable? For that matter, why would LUKoil, or Yukos, or any oil company?

Khodorkovskii's public doubt about the economics could be nothing more than a bargaining tactic, or it may be a way to please officials like Kalyuzhny. But either way, the arguments about politics and economics will have to be settled in the next three months.

Copyright 2002 RFE/RL

 

<>2002ap:VNZ| Attempted coup vs-QavH
*--ExxM.crp.nrg mnger in VNZ= Cutt,Tim [Coll.Private:408-10,423-6]

<>2002ap09:WDC| USA.stt.dpt launched "Future of IRQ" prj| Earliest plans generated during "Deputies Lunches" at WhH by sr. ofcials of Ptg, CIA, stt.dpt, etc. [M.crn]

 

<>2002au18:Russia's northern port of Murmansk is the focus of the latest plans to increase oil supplies to the United States. The interest in an Arctic export route may also be a sign of continued opposition to the US-backed Baku-Tbilisi-CYN.ptpt, which offers access to a warm-weather port.

Russia's top oil companies may combine forces in the Arctic port of Murmansk to boost petroleum exports to the United States. Mikhail Khodorkovskii, CEO of Russia's second-largest oil giant Yukos, said in Moscow that the firm is considering a LUKoil plan for a new export terminal at Murmansk that could ship 1 mm bpd of crude to the West.

LUKoil, Russia's largest oil firm, first floated the port plan in May during a Moscow summit, where Presidents Vladimir Putin and George W. Bush signed a joint declaration on creating an energy partnership. Since then, analysts have been surprised at Russia's speed in promoting oil exports to the US market.
Shortly after Yukos' first oil delivery from the Black Sea port of NVR in early July, the company announced it would make regular monthly shipments. Critics had previously said that Russian routes to the United States would be too costly and too long. Russian oil companies see Murmansk as a possible way out.

LUKoil has already approached the state ptpt company Transneft about building a line to Murmansk on the Barents Sea and expanding facilities at the port, which is also home to the Northern Fleet. LUKoil has invited other companies to join in the project, and Khodorkovskii's statement is seen as a sign that rival Yukos may accept.
Khodorkovskii said on 14 August: "We have asked our colleagues from LUKoil to send us a Murmansk route project, which we are currently studying. So far it does not seem an unrealistic project." The Yukos endorsement could prove important to the project because of the high price of ptpt construction.

A line of some 1,000 km from SBRn oil fields at Ukhta has been in planning stages since at least 1998. Not all theRussian reaction to the plan has been positive. On 15 August, Transneft's vice president, Sergei Grigoriev, was comparing it to the US-backed Baku-Tbilisi-CYN.ptpt from the Caspian to the Mediterranean Sea.
Grigoriev said that the new oil export route "risks being the new Baku-CYN: It demands a lot of financing and is only oriented at the US market." Transneft is apparently concerned that it would not control exports from the Murmansk terminal.

It is unclear whether alternate schemes are being considered. By 2010, LUKoil plans to produce 22 mm tpy of oil from the Timan Pechora Basin bordering the Barents Sea, according to a May report. One advantage of Murmansk is that its deep water could handle 300,000-ton tankers, reducing shipping costs.
In May, LUKoil Vice President Leonid Fedun said that transport costs of $ 28 per ton could compete with oil from the PER.G. He noted that the outlet was considered the best for exports to the United States in Soviet times. The port itself is ice-free with berthing depths of 11.5 meters and potentially reaching 16 meters. Murmansk currently ships oil throughout the Arctic region, using supplies delivered by rail.

The plan is roughly in line with several Russian trends. In addition to the US energy partnership, Russia plans to raise its oil exports by more than 20 % in the next three years to 4.3mb/dy. The plan confirms Russia's intention to act independently, despite statements of cooperation with OPEC.
Russia is rapidly expanding port capacity for oil exports with the recent start of work on a terminal in the Gulf of Finland on the island of Vysotsk, after opening a new port at nearby Primorsk last year. Transneft is also trying to link Russia's D.ptpt to the Adria network so that it can export from Croatia's deepwater port at Omisalj into the Mediterranean. Like a planned project through Greece, the outlets could ease oil traffic through the Bosporus. Supporters of the Murmansk route have cited the same benefit.

But despite the US partnership, all the plans assume that Russia will continue to shun the Baku-Tbilisi-CYN ptpt, raising doubts about the limits of the policy. The project, which is due to be launched officially next month, also aims to increase oil exports to the West and bypass the Bosporus. But Russia has opposed the link through AZR and Georgia for the past eight years.
Moscow has reportedly barred LUKoil from joining the project, although the company has said it may use the line to ship oil once it is built, since it owns a share of the oil fields that will feed it. But the government's objections has apparently prompted plans for new northern routes like Murmansk instead of a warm-water port like Turkey's CYN.

In May, Russia and Georgia announced a joint venture to build a link to Baku-Tbilisi-CYN from NVR, to give it export access that would be unaffected by winter storms. Since then, there has been little sign of progress on the plan. Grigoriev's comment suggests that Russia's distaste for the route is continuing, along with moves to reach Western markets by other means. Source: RFE/RL

<>2002oc10:USA Cng passed resolution which was taken to give Bw2 the power to use force in IRQ

<>2002no08:UNO passed resolution#1441 warning IRQ of "serious consequences" if it did not comply w/ sanctions and arms inspections

<>2002no11:Ptg awarded KBR 1st rebuilding contract, to plan for postwrx repair of IRQ's nrg.p industry
*--USAID & other agencies developed frist detailed plans for providing emergency food, shelter, and mdx supplies
\\
*--M.crn

 

<>2002de:BP.crp.nrg fxx-INK-Sidanko (RUS’ fourth largest oil cmp)

 

 

<>2003ja03:USA prx Bw2 issued prx directive creating Office of Reconstruction and Humanitarian Assistance, otx gnr Jay Garner=1st head

<>2003ja27:UNO chief weapons inspector, Hans Blix, raised Q~ re.HsnSdm's compliance during briefing at the UN Security Council

<>2003fe05:USA scy.stt Colin Power before UNO to make case for wrx

<>2003mr08:USA Army Corps of Engineers [>mlt.CoE] awarded Hlb nrg.p contract "worth up to $7.0b to rehabilitate IRQ's oil industry" [M.crn]

<>2003mr17:USA prx Bw2 issued ultimatum to HsnSdm & ssn~: leave IRQ w/in 48hours

<>2003mr19:Suprise attack against possible HsnSdm hideouts, "shock and awe" attack on IRQ

<>2003mr20:USA/ENG full-scale assault under way

<>2003mr22:Hlb.bdg.crp oil engineers follow the troops

<>2003ap:Washington Report on Middle East Affairs#22,3:35| BAKU-CYN.ptpt Update--Oil and Water Don't Mix

Washington Report on Middle East Affairs, Apr 2003, Vol. 22 Issue 3, p35, 1/2p | By Andrew I. Killgore, publisher of this >WR.MEA.[TRK IST] [SOURCE]

*2000: [Three years ago,] to expel doubts, then President Bill Clinton made a special trip to Istanbul to countersign an earnest document that AZR and TRK build the BKU (AZR) and CYN (Turkey) oil ptpt. Last year the two countries laid the symbolic first section of pipe, near BKU, with Secretary of Energy Spencer Abraham reading the laudatory words of President George W. Bush.

A snag has been hit, however [ecx], because the ptpt would threaten the Republic of Georgia's highly prized mineral water in the Borjami Valley. Activists already have demonstrated outside the London offices of the European Bank of Reconstruction and Development [>ERD.bnk | W | Wki], which was to put up the financing for the project. This means that loans from the Bank might not be available until the second half of this year.

Israel — and thus the United States — are sedulously pushing the ptpt to prove to Turkey that its alliance with Israel pays off in Washington. British Petroleum (BP BP.crp.nrg), which heads the 11-member consortium to build the 1,100 mile, $3 billion BKU-CYN, faces difficulties in finalizing terms for external financing due to the project's high cost, technical challenges and security and environmental concerns.

The consortium's smaller members, including AZR, which has a 25 percent stake in the ptpt, would be “forced to find substantial sums of cash that it doesn't have,” according to the Feb. 6 Financial Times. That means the United States, or an international financial organization under American influence, will have to come up with the money.

Originally all the oil companies operating in the Caspian region, including BP opposed BKU-CYN. British Prime Minister Tony Blair — former Friend of Bill and current Friend of George — brought BP around to his “special relationship” with the United States. But just where the daily million barrels of oil will come from to make BKU-CYN viable remains a mystery.

[KZX] Given that AZR produces only “disappointingly small amounts,” the only source for the extra oil is Kashagan, Kazakhstan's very large offshore (in the CSP.S) oil find. But Kashagan's production will not come on line for six to 10 years. Moreover,

Kazakhstan favors an oil ptpt that runs through IRN to the PER.G.

 

<>2003ap09:BGD fell to USA led troops. Looting spreads across IRQ [M.crn]

<>2003ap12:USA Cng approved 1st installment of reconstruction aid to IRQ, $2.4b

<>2003ap17:USAID awarded B.bdg.crp (SF.CA) 2nd major reconstruction contract, $680m to rebuild scl~ and nrg.e grid, wtr & sewage treatment plants [M.crn]

<>2003ap21:gnr Garner gt-BGD after "weeks in KWT" & occupied "Green Zone"| He fnd most gvt bdg~ looted [M.crn]

<>2003ap22:Hlb.bdg.crp got IRQ nrg.p flowing [M.crn]

<>2003my01:USA aircraft carrier Abraham Lincoln site of Bw2 landing in pilot's uniform & announcing end of "major combat" and beginning of reconstruction [M.crn] "mission accomplished"

<>2003my12:2004je; USA >Coalition Provisional Authority [>CPA] for IRQ, headed by Paul Bremer, the viceroy [Muttitt.Fuel:ndx]
*--A time of (1) wild looting and (2) calmly calculated long-term & well-planned looting [Muttitt.Fuel:145-224]
*--B.bdg.crp bgn repair of IRQ nrg.e grid which produced only ca. 300 megawatts of nrg.e
*2003je15:IRQ Program Review Board [>PRB, under USA control] bgn to spend IRQ nrg.p revenues [M.crn] =

*2003jy03:Coalition reconstruction chief Rear-Admiral David J. Nash [You-Tube presentation at minute 26:30], and CFO Oliver,David created list of projected building project bdg.prj~

<>2003jy22:Mosul| HsnSdm's ssn~ Uday & Qsay killed in shootout at their hideout

<>2003au03:Jordon| carbombs vs- USA Emb.irx & UNO compound| USA allies fading in face of growing violence

<>2003se07:USA Bw2 asked $20b more for IRQ rebdg | sde USA would "spend what is necessary" to achieve victory [M.crn]

<>2003oc05:IRQ| B.bdg.crp reached USA goal of 4,400 megawatts & reset goal to 6,000 [M.crn]

<>2003oc05:Russian oil executive Mikhail Khodorkovskii arrested
\\
*--The full story and its deep significance more fully accounted in Sakwa.Quality

<>2003oc23:SPN| Madrid Cnf| irx donors pledged $14b more fr IRQ rebdg| "Most of the money is never delivered"| Donors backed out [M.crn]

 

 

<>2003oc,e:Lee Raymond, CEO of ExxonMobil corporation informed Russian Prime Minister Mikhail Kasianov that ExxonMobil and YUKOS have been holding negotiations on possibility of a merger. According to Wall Street Journal ExxonMobil was to acquire a forty-percent stake in YUKOS with a possible controlling share upon Khodorkovsky’s retirement.[1]

<>2003oc30:NYT| Hints in Russia of Crisis Over Tycoon Case| By STEVEN LEE MYERS

MOSCOW, Oct. 29 — Reports that President Vladimir V. Putin's powerful chief of staff resigned in protest over the arrest of the country's richest businessman heightened concern on Wednesday that the Kremlin had gone a step too far in cracking down on him and his oil company, risking capital flight and political instability.

Aleksandr S. Voloshin, a quiet but influential figure known as Mr. Putin's "gray cardinal," submitted his resignation on Saturday, the day that masked agents arrested the tycoon, Mikhail B. Khodorkovsky aboard his private jet in SBR, according to published reports and an analyst with ties to the Kremlin.

There were conflicting reports on whether Mr. Putin had accepted Mr. Voloshin's resignation. Mr. Putin did not address the question Wednesday, and a spokesman at the Kremlin declined to confirm or deny his departure, deepening a sense of turmoil around the Kremlin in the widening investigation of Mr. Khodorkovsky and his company, Yukos Oil.

The reports of Mr. Voloshin's resignation — and the possibility of a turnover in Mr. Putin's inner circle — swirled through Moscow like a winter snow. It contributed, analysts said, to a new drop in the country's stock markets, which wiped out the modest rebound the day before after a steep drop on Monday.

It also raised questions about whether a tactical move intended perhaps to strengthen Mr. Putin and his circle ahead of December's parliamentary elections could prove a strategic mistake that would weaken Russia as well as the president.

"This is not pleasant news for the president," said Andrei A. Piontovsky, a political analyst with the Center for Strategic Studies, who said he had learned of Mr. Voloshin's resignations from officials inside the Kremlin. "It indicates the depth of the political crisis he faces. I think the president was surprised and tried to convince him to stay, but actually I know that Mr. Voloshin is determined to leave."

Mr. Voloshin, who has been the Kremlin's strongest advocate for advancing pro-market policies, is the leader of one of the two factions widely believed to be struggling for political influence under Mr. Putin.

On Mr. Voloshin's side is a coterie of aides who favor greater freedom for the economy. On the other are those advisers who, like Mr. Putin himself, served in the K.G.B. or other security services and favor a stronger role for the state in business and other matters.

That faction, known collectively as the siloviki — or as Chekists, after the old Soviet-era word for intelligence operatives — is widely believed to have initiated or supported the prosecutorial assault on Yukos, though exactly why remains unclear.

Mr. Piontovsky, echoing commentaries in the Russian news media, said Mr. Putin had come down on its side when he strongly defended Mr. Khodorkovsky's arrest on Monday and rebuffed a request from business and industrial leaders to resolve the allegations in a less confrontational way.

"Philosophically, he was always close to this group," Mr. Piontovsky said. "He's Chekist. They're Chekist. All their philosophy — managed democracy, vertical power — is what he believes."

The investigation showed no signs of ebbing. The Prosecutor General's Office announced Wednesday that it would investigate the abrupt appointment on Monday of another senior Yukos executive, Vasily S. Shakhnovsky, to the upper house of Parliament representing Evenkia, a sprawling but sparsely populated region in SBR.

His seat gives him immunity from prosecution. Appointments to such political positions have become a well-worn path for prominent Russians facing criminal charges.

Earlier this month prosecutors accused Mr. Shakhnovsky, the head of the subsidiary Yukos Moscow, of filing falsely for tax breaks, but they did not arrest him. At the time, Mr. Shakhnovsky called the accusation — similar to one of those against Mr. Khodorkovsky — baffling.

After regaining some ground from Monday's steep drop, the company's stock fell another 2.2 percent, closing at $12.10 a share, while one of the main market indexes, the R.T.S., fell 3.7 percent.

If confirmed, Mr. Voloshin's resignation "may send a signal to the foreign investment community that this is not just about Khodorkovsky, and that other changes are taking place behind the doors of the Kremlin," said Alexander Z. Kazbegi, head of research at Renaissance Capital in Moscow.

Mr. Khodorkovsky, 40, faces seven accusations of fraud, tax evasion and forgery. In an unusual and lengthy statement, reprinted in Kommersant, the main business newspaper, on Wednesday, the Prosecutor General's Office outlined a convoluted web of what it described as shadowy financial dealings involving Mr. Khodorkovsky and his associates dating back to 1994.

The statement also accused him of committing embezzlement by transferring money to another tycoon who has faced the scrutiny of investigators, Vladimir A. Gusinsky, but it did not explain why the transfer was a crime. Mr. Gusinsky has lived in self-imposed exile since fleeing fraud charges in 2000.

Anton V. Drel, Mr. Khodorkovsky's lawyer, protested the statement's release and its tone of presumption of guilt. In an interview, he dismissed the charges as "absolutely groundless," saying that transactions cited as illegal had previously been approved by courts and government auditors. On Tuesday he appealed Mr. Khodorkovsky's detention, but he did not sound hopeful that he would be released anytime soon.

A court on Tuesday ordered Platon Lebedev, a major Yukos shareholder who was arrested in July, to remain in prison until Dec. 30. Courts can order a suspect held up to 18 months while investigators make their case.

Mr. Khodorkovsky is in a cell with two other prisoners, said Mr. Drel, who visited him again on Wednesday. Mr. Khodorkovsky, he said, had no complaints about his treatment there, but he has not yet received permission to see his wife or received books he had asked for.

Among other volumes, Mr. Drel said, he wanted a copy of the Constitution and the criminal code.

---

<>2003oc31:NYT| MOSCOW FREEZES BILLIONS IN STOCK OF OIL PRODUCER

By STEVEN LEE MYERS and ERIN E. ARVEDLUND (NYT) 1547 words

Late Edition - Final , Section A , Page 1 , Column 1

ABSTRACT -
Russian prosecutors freeze stock worth billions of dollars in country's richest company, Yukos Oil, raising stakes in their investigation of its imprisoned chief executive Mikhail B Khodorkovsky; Kremlin announces that Pres Vladimir V Putin has removed his chief of staff Aleksandr S Voloshin, who had already resigned to protest Khodorkovsky's arrest; Putin replaces Khodorkovsky with his deputy, Dmitri A Medvedev; these are most significant changes in Putin's inner circle since he took office four years ago, demonstrating wide political ramifications of Khodorkovsky's arrest; Yukos affair highlights central political struggle in Russia between reform-minded officials favoring market economy and others, many with security services background, who are determined to retain strong dose of state control; Putin has tried to steer course between two; he has reportedly criticized prosecutors who went after Khodorkovsky; he meets with major investors to try to reassure them and calm political and economic situation; freezing of Yukos shares sends country's already reeling stock prices plunging still further

IN THIS SAME ISSUE = 2003oc31:NYT BUSINESS/FINANCIAL DESK | Former Enron Executive Pleads Guilty

By KURT EICHENWALD (NYT) 1191 words

Late Edition - Final , Section C , Page 1 , Column 5

ABSTRACT - Former Enron executive David W Delainey pleads guilty to insider trading, admitting that he sold millions of dollars in company shares at time he knew its financial performance was being manipulated improperly; Delainey is highest-ranking Enron official to admit participating in crimes, and his plea signals new direction in government's criminal probe into Enron's collapse; Delainey, Canadian citizen, will pay about $8 million in penalties--$3.7 million in civil case and $4.3 million in criminal case; also faces maximum prison sentence of 10 years and additional $1 million fine; agrees to cooperate in continuing investigation

 

 

<>2003no02:USA Cng approved $18.4b for Iraqi Relief and Reconstruction Fund [IRQ rebdg,round 2] | Largest USA aid package since Marshall Plan [ID] [M.crn]

 

<>2003no05:NYT|How Russian Oil Tycoon Courted Friends in U.S. | By TIMOTHY L. O'BRIEN
In early 2001, as George W. Bush's administration moved into the White House, one of Russia's wealthiest men, Mikhail B. Khodorkovsky, sought a meeting with the new national security adviser, Condoleezza Rice. According to a former staff member, National Security Council analysts were asked to perform a background check.

Mr. Khodorkovsky did not get the meeting — part of the tycoon's efforts to secure approval from the American establishment — because of "allegations of past business improprieties," the former staff member said, also noting that Mr. Khodorkovsky spent heavily in Washington to court the Capitol's inner circle.

[Crl.grp] But Mr. Khodorkovsky's steady efforts to win access to other influential Americans have paid off. Last July, he met with Energy Secretary Spencer Abraham to discuss America's oil policy. Former President 2003se:George H. W. Bush traveled to Russia and spoke at a dinner attended by Mr. Khodorkovsky.

That event prompted Moscow newspapers to speculate that the visit was part of an effort by American companies to secure a merger with Yukos Oil, where Mr. Khodorkovsky was chief executive until he quit on Monday in a swirl of fraud and embezzlement charges. His replacement, a Russian-born American, was confirmed yesterday.

The Carlyle Group, an investment bank that retained the elder Mr. Bush as an adviser until a few weeks ago, has a close business relationship with Mr. Khodorkovsky. Although Mr. Bush was in Russia as a Carlyle representative, the bank said, his visit had nothing to do with oil deals and he did not meet privately with Mr. Khodorkovsky.

Last summer, too, Mr. Khodorkovsky traveled to a meeting of business leaders in Sun Valley, Idaho, as a guest of a former senator, Bill Bradley, a New Jersey Democrat. Mr. Bradley also advises the Open Russia Foundation, a Russian philanthropy based in Britain that is bankrolled by Mr. Khodorkovsky.

Henry Kissinger, secretary of state in the Nixon administration, is on the foundation's board, a position he said he accepted at the invitation of Lord Rothschild, another board member. Mr. Kissinger said he had only met Mr. Khodorkovsky twice, briefly and in a group.

"It is in no sense an endorsement of Mr. Khodorkovsky's business practices," Mr. Kissinger said of his board seat, adding that Mr. Khodorkovsky exercised "no particular influence" over the foundation's grants. He declined to comment further on Mr. Khodorkovsky.

In his efforts to carve out contacts and make his name, Mr. Khodorkovsky has also donated substantially to philanthropies in Russia and to American think tanks.

People close to him said he had three motives: improving his own reputation after surviving Russia's scandal-plagued privatizations; refashioning operations and perceptions of Yukos Oil in preparation for a merger with a Western company; and the furtherance of economic and political changes in Russia.

"He wanted to have ties to the United States and he had a goal of exporting oil to the United States," said Sarah Carey, a Washington lawyer who sits on Yukos's board and is a close adviser to Mr. Khodorkovsky. "In order to do that you need to develop constituencies here in Washington."

Philanthropy, she added, "is what smart guys do when they get rich."

Foreigners are not allowed to donate money to American politicians or political parties, and most of Mr. Khodorkovsky's charitable giving has centered in Russia, where Yukos reports philanthropic donations of more than $50 million annually across a broad range of causes.

Through Yukos, however, Mr. Khodorkovsky has given handsome sums to American organizations, including a $1 million donation to the Library of Congress and a $500,000 pledge to the Carnegie Endowment for International Peace, a think tank that is home to some of the most often quoted analysts of Russian affairs.

Carnegie notes that Yukos's contributions amount to less than 3 percent of its annual budget. Anders Aslund, a Russia expert at the foundation who has criticized the Russian government in its standoff with Mr. Khodorkovsky, said Yukos's backing is disclosed on the Carnegie Web site. He added that while the donations are significant, they do not affect his assessment of Mr. Khodorkovsky.

The American Enterprise Institute, another Washington think tank that has weighed in on Mr. Khodorkovsky's behalf, declined to address financial dealings with Yukos, citing the institute's policy not to comment on such matters.

Fiona Hill, a Russia analyst at the Brookings Institution, said many think tanks, needing money for Russia studies programs, had courted Mr. Khodorkovsky zealously. She said that Brookings, however, decided not to accept his donations.

"The think tanks were all joking about who wanted to take money to fund the Mikhail Khodorkovsky chair of good corporate governance," Ms. Hill said. "There were still questions about his business dealings and whether he really made the transition from being a robber baron and now wore a white hat."

Others in Washington said that influence is not so easily purchased and that Mr. Khodorkovsky had traction in the United States because of an authentic commitment to corporate and political change in Russia.

"What distinguishes Khodorkovsky is that he recognized that the rule of law was necessary to legitimize his company," said Steve Biegun, who is a national security specialist on the staff of Senator Bill Frist of Tennessee, the Republican leader, and has met several times with Mr. Khodorkovsky.

"Russian oligarchs have spread a lot of money around Washington over the last decade, but we're not stupid here," he added, noting that Mr. Khodorkovsky's qualities helped generate "a much deeper response than when other Russian businessmen have been hounded."

Correction:
Nov. 7, 2003, Friday | A front-page article on Wednesday about efforts by Mikhail B. Khodorkovsky, founder of the Russian oil company Yukos, to gain access to influential Americans misstated the relationship between former Senator Bill Bradley of New Jersey and the Open Russia Foundation, a Russian philanthropy based in Britain and financed by Mr. Khodorkovsky. Although Mr. Khodorkovsky asked Mr. Bradley to serve on the foundation's board, Mr. Bradley says he declined and is not advising the foundation.

<>2003de09:USA dep.scy.def WwzP barred cmp~ frm FRN GRM & other non-coalition ntn.stt~ frm major IRQ rebdg contracts
*--stt.dpt & Ptg squabbled over control of mny| Delays followed [M.crn]

<>2003de13:HsnSdm captured

<>2004:NefteRynok magazine on nrg tpt

<>2004mr04:First rebdg contracts up to $12b awarded to USA tntn crp~, EG=B.bdg.crp. Fluor bdg, Washington Group International, Perini.crp, Parsons, Lucent, and CH2M Hill [M.crn]

<>2004mr08:IRQ GCnc signed Transitional Admnistrative Law (vrm.cst) w/ time-line for new IRQ gvt [M.crn]

<>2004mr29:Russian nrg.p executive. prx of Yukos [Yuk.crp.nrg] Khodorkovskii,Mikhail [Michael Khodorkovsky] wrote "The Crisis of Russia's Liberalism" [TXT] | G/Sakwa.Quality

<>2004ap:IRQ insurgency in s-central and zpd (Fallujah and Ramadi)

<>2004oc:IRQ| Special Inspector General for Iraq Reconstruction [rvz.gnr fr IRQ.rebdg] created [W]
*--On IRQ.wrx [Coll.Private:227-37]
*--On IRQ nrg.p rzv~ [Wki]

<>2004ap09:Hlb.bdg.crp fuel convoy attacked outside BGD| 2 sld dth.w & 1 missing; 6 prv contractor drivers dth.w & 1 missing

<>2004ap28:Abu Ghraib prison scandal into open

<>2004je28:Bremer hands control to IRQ interim gvt picked by UNO & USA. Ayad Allawi (another pre-USA gte returned to IRQ) bcm Mnr1
*--Negroponte,John takes up post of USA Amb.urx
*--nrg.e at 4,700 megawatts/d = peak postwar level

<>2004se04:USA Amb.irx Taylor,Bill heads new rebdg agency, Iraqi Reconstruction Management Office [>IRMO] which apx USAID, the Project and Contracting Office [>P&CO, the 1st rebdg agency] and other agencies involved in rebdg
*--IRQ nrg.p production = 2.50mBd
*--IRQ Mnr.def ofcal Ziad Cattan, USA appointed, signed 1st weapons and equipment contracts worth ca. $1.30b, paid w/IRQ mny| IRQies accused Cattan of corruption ~~this [M.crn]

<>2004se14:USA.stt.dpt announced revised rebdg strategy = billions now redirected away from wtr hlt & nrg.e prj~ to security
*--Also USA religuished to IRA hands more responsibility ~~recently built infrastructure [M.crn]

<>2005ja30:First free and fair elx in modern ARB hst, transitional gvt to draft cst. United IRQi Alliance, coalilition of Shia grp~ wins narly 1/2 vtx~ [M.crn]
*--After elx, Bowen,Stuart, spc rvz.gnr for rebdg of IRQ, announced that audit of DFI cannot properly account for nearly $9b [M.crn]

<>2005ap28:IRQ National Assembly approved new cabinet, after difficult balancing of Sunni Shia and Kurdish fxnal INX~

<>2005my11:USA lwx provides 3rd major IRQ rebdg aid bjt= $5.40b, nearly all for training and equipping security forces [M.crn]

<>2005je22:China put in the highest bid for the purchase of Uno.crp.nrg, a 115-year-old USA energy firm
*--Eventually Republicans in US Congress blocked sale [Klare.Rising=1ff(Prologue)]

<>2005oc15:IRQ cst approved by popular vtx

<>2005de05:P&CO disolved into USA mlt.CoE

<>2005de15:IRQ exl 1st vqn gvt since HsnSdm, a PRL

<>2006my20:IRQ vqn cabinet Mnr~ names
*--Ca. 90% of rebdg mny contracted out [M.crn]

<>2006my24:Harper's |>Silverstein,Ken [ID#1 | ID#2 (EnergyBlogs)]| "The Professor of Repression"

[C.ASA UZB] A year ago this month [IE=In 2005my], security forces in Uzbekistan killed hundreds of protesters in the town of Andijan. Human rights groups and journalists reported that the crowd was overwhelmingly unarmed and had come out to protest corruption and poor economic conditions. “The scale of this killing was so extensive, and its nature was so indiscriminate and disproportionate, that it can best be described as a massacre,” Human Rights Watch said in a study of the events at Andijan.

The regime of Islam Karimov sought to justify the carnage by saying that the demonstration was organized by Islamic militants seeking to overthrow the government (an argument the Uzbek government knows is music to the ears of the Bw2 Administration). Last week the Karimov regime sought to prove its case by staging the U.S. debut of a short video on the Andijan crackdown. The event was sponsored by the Hudson Institute and the Central Asia Caucasus Institute (CACI [ID]) at Johns Hopkins University, and co-hosted by CACI director Professor S. Frederick Starr. An account at EurasiaNet.org said that Starr “sought to undermine the credibility of several independent news accounts . . . alleging journalists deliberately falsified their stories. ‘I think they were lying . . . of course they had an anti-government agenda,’” he said.

It was all in a day's work for Starr, who is perhaps the Karimov regime's most outspoken advocate in Washington—a regime that once tortured a political prisoner to death with methods that included the use of boiling water and then arrested his elderly mother when she complained. He also speaks fondly of several other despotic governments in central Asia, a region he views almost exclusively through the prism of American geopolitical interests and with little interest in issues like human rights and corruption.

Starr, an advisor on Soviet Affairs to Presidents Ronald Reagan and George H.W. Bw1, is described by those who know him as charming, erudite, and brilliant. His 1983 book, Red and Hot: The Fate of Jazz in the Soviet Union, is widely considered to be one of the most intellectually scintillating feats of Cold War scholarship. Starr is a past director of Sidanko, a Russian energy corporation, and Rector Pro Tem at the University of Central Asia.

Starr has led CACI since it was founded in 1996, and he has actively sought friendly relationships with Central Asian governments and leaders. He even wrote the preface to the 1998 English-language version of Karimov's page-turner, Uzbekistan on the Threshold of the Twenty-First Century. Starr wrote that Uzbekistan had “made impressive strides” since gaining independence in 1991, including putting “in place the main elements of a more consultative and responsive government,” and went on to approvingly cite Karimov's assertion that “social harmony and stability are the essential conditions for reform and not merely its consequences.” Translation: “Until the population stops complaining about my leadership, reform is impossible and political repression required.”

CACI has also worked closely with the Bw2 administration. Starr is especially tight with vice president Dick Cheney's office and is friendly with ex-Deputy Defense Secretary Paul Wolfowitz [>WwzP], now head of the World Bank [WoB]; Wolfowitz is also the former dean of John Hopkins's School of Advanced International Studies, where CACI is housed. The Ptg has long sought to justify its ties to Central Asian [C.ASA] regimes and Starr has been happy to deliver the requisite intellectual underpinnings. At the request of the Joint Chiefs of Staff he helped author a 2001 study, Strategic Assessment of Central Asia, which was produced by CACI and the Atlantic Council. “The U.S. government uses his institute as a bridge to deepening relationships with governments in the region,” said a person familiar with CACI and who asked to speak off the record.

CACI works closely with the local Uzbek embassy and Starr sometimes appears on Capitol Hill, where he offers testimony that invariably supports the regime. At one congressional hearing in 2004 he said that Uzbekistan was making important strides on democracy and attacked human rights groups, suggesting that they were exaggerating problems under Karimov.

Starr also is frequently cited in the press, where his close ties to the government go unnoted and he is identified merely as an independent academic expert. In a 2004 story in the Washington Times, he decried Congress's refusal to certify that Uzbekistan was making progress on human rights, which had led to a partial aid cutoff. "This is a shortsighted, poorly informed and self-defeating decision that contradicts the view of some of the best experts in the stt.dpt itself and of independent experts as well," he told the newspaper. “The decertification is a body blow to many known reformers in the Uzbek government.”

On May 16, 2005, just days after the Andijan massacre, Starr was already peddling the Karimov regime's line in an interview on NPR. He generally blamed problems in the country on Islamic militants, described the country as a “linchpin of the region,” and said a revolution there "could be a disaster." The United States, said Starr, has “a very serious interest there, not jut a security one but a large regional one because it borders all the countries in the region.”

Starr doesn't just do Uzbekistan. He served as an election observer to Kazakhstan's 2004 parliamentary vote, a trip sponsored by a group called the International Tax and Investment Center (ITIC). Starr and an “independent” observer team that included ITIC's president, Daniel Witt, said that while much of the Western media “judged the election a failure,” it had concluded that the balloting marked “a real and even notable step forward.”

Starr and Witt were back to “monitor” the following year's presidential vote in Kazakhstan and they again disagreed with the majority of observers who denounced the election as badly flawed. “While there were shortcomings compared to international standards, it was a genuine competition and represented an important step forward, not only for Kazakhstan but the entire region,” they wrote. As with the 2004 ITIC report, the Kazakh embassy in Washington posted the assessment on its web site.

So what exactly is the ITIC? According to the group's web site, it is a non-profit organization “that is helping to lower barriers to tax, trade and investment in transition economies by facilitating the exchange of information and know-how between Western executives and government officials in these countries.” Witt emphasized in an email to me that ITIC receives no funding from the Kazakh government. That's correct—but he does get cash from a host of companies and organizations with interests in Kazakhstan, including the American Chamber of Commerce in Kazakhstan, ChevronTexaco, China National Petroleum Corporation, ExxonMobil, Halliburton, the Kazakhstan Petroleum Association, Marathon Oil Corporation, and Occidental Petroleum.

I emailed back to ask Witt if such funding undermined ITIC's claim of independence. “ITIC does NOT do election related work,” he replied. “These two election related missions were more my personal desire to further promote economic reforms and show the positive correlation with political reforms. Thus, there was NO influence on the above mission reports and related op-ed/articles from any of our sponsors or board members.”

Right. I'm sure Witt would deem as impartial an election observer team sent to Cuba by a group that was funded by companies with billions invested on the island. His assertion that ITIC does no election work seems equally bizarre, especially as a statement by his team of observers was put out on ITIC letterhead and both reports are on the group's web site.

Starr has also lent a helping hand to the regime in Azerbaijan. In October of 2002, Ilham Aliyev – who has since succeeded his father as president but was then First Vice-President of the state oil company, a member of parliament, Vice-Chairman of the ruling New Azerbaijan Party, and head of the national Olympic Committee—visited Washington for meetings with Bw2 administration officials and with “prominent policy thinkers,” according to a statement from the Azeri government, which listed Starr in the latter category.

During that visit, Aliyev also spoke at Johns Hopkins, an event sponsored by Starr's CACI and Harvard University's Caspian Studies Program, the latter which has converted itself into the Azeri government's unofficial press agency. The Caspian Studies Program was launched in 1999 with a $1 million grant from the United States-Azerbaijan Chamber of Commerce—whose past and present advisors and directors include Dick Cheney, Henry Kissinger, James Baker III, and Brent Scowcroft—and a consortium of companies led by ExxonMobil and Chevron. Its inaugural program was a panel discussion featuring Ilham Aliyev.

Unlike Harvard, Starr apparently doesn't charge for his services. He told me that CACI receives no funding from Central Asian governments or oil companies other than $25,000 annually from Chevron during the Institute's first few years of existence, which Starr said was cut off because the company disagreed with certain positions taken by CACI. Given Starr's record, that's true ingratitude.

 

<>2006de21:ASHGABAT (Reuters report by Marat Gurt) - Turkmenistan President-for-life Saparmurat Niyazov died suddenly on Thursday after 21 years of iron rule in which he crushed all dissent, raising fears of instability in the isolated but energy-rich C.ASAn state.

He was 66.

Niyazov, who fostered a bizarre personality cult as absolute ruler of a country with huge natural gas rzv~, died overnight of cardiac arrest, state television said.

His funeral was set for December 24 and the government fixed December 26 for the desert nation's highest representative body to meet to decide on the succession and name a date for elections.

Turkmenistan has never held an election judged fair by Western monitors. Until the new polls, which have to take place within two months, Deputy Prime Minister Kurbanguly Berdymukhamedov, 49, will be acting head of state.

Niyazov, who held all top posts, left no designated heir and his death raised concerns about the transfer of power in the ex-Soviet nation of 5 million, where foreign oil and gas companies are keen to invest.

Turkmenistan is a vital link in the supply chain between former Soviet gas fields and European Union consumers since it meets the demands of the huge Ukrainian market, freeing up Russian gas for Europe.

Once a Soviet apparatchik, Niyazov took the title of "Turkmenbashi (Head of the Turkmen) the Great" and had thousands of portraits and statues of him set up throughout the country.

They include a statue in gold leaf that rotates to face the sun in the capital Ashgabat. He renamed the month of January after himself and his name was also given to a sea port and even a meteorite.

Niyazov's health had long been the subject of speculation among Turkmenistan-watchers and foreign investors. After heart surgery in 1997, he quit smoking and ordered all his ministers to follow suit. He had publicly admitted to heart problems.

Flags flew at half-mast on Thursday from public buildings in Ashgabat, a Soviet city grandly reconstructed to showcase Niyazov's power.

Workers removed all New Year decorations from the streets and television ran still images of a national flag in a black-bordered frame as an orchestra played solemn tunes.

The public mood appeared calm but, given Niyazov's long, unchallenged rule, some expressed concerns for the future.

"I'm worried that a power struggle will start now. I just hope there will be no civil war," Rumina, a school teacher who declined to give her last name, told Reuters at a local market.

FIGHT FOR POWER?

Under the constitution, Parliament head Ovezgeldy Atayev should have automatically become acting head of state. But, in a sign of political tensions, justice officials immediately opened a criminal probe into his activities, blocking his appointment.

"I expect there will be a massive fight for power now in Turkmenistan and it's likely to take place between pro-U.S. and pro-Russian forces," said a Russian gas industry source, who declined to be named. "Gas will become the main coin of exchange and the key asset to get hold of."

Although others doubted any successor would want to put vital gas contracts at risk, one EU diplomat in Moscow said: "If there is a change in gas policy, that would have an impact on Ukraine and then on the European supplies. It's a domino game."

Niyazov brooked no dissent and was criticized by human rights groups for flouting basic freedoms and allowing torture.

International rights campaigners urged Turkmenistan to release hundreds of jailed political prisoners.

"We can only hope that his successors will ... honor the fundamental rights and freedoms the people have been cynically denied," said the International Helsinki Federation for Human Rights.

In a statement, the U.S. embassy in Ashgabat said Washington hoped "for a peaceful, smooth, constitutional succession". The Kremlin urged Ashgabat to continue good ties with Russia.

Berdymukhamedov, the new acting president, is said by the opposition to be related to Niyazov. He was earlier named to head a commission handling the funeral.

But the country's constitution appears to rule out an acting president standing as candidate for election as head of state.

Exiled Turkmen opposition activists said they intended to immediately try to return home.

"Our first task is to return to Turkmenistan within hours ... In Turkmenistan there is no opposition, they all sit in prisons or under home arrest. But outside the country opposition exists and it is coming back," one activist, Parakhad Yklymov, told Reuters by telephone from Sweden.

(Additional reporting by Gleb Bryanski, Dmitry Zhdannikov, Tom Miles and Elif Kaban in Moscow)

<>2007:IRQ Oil.lwx, decisive year|
(1) Decisive debate (among IRQ fxn~ in USA-shaped parliament [>IRQ.PRL]) and
(2) decisive imposition (by Big Oil and US officials) [Muttitt.Fuel:208-44]

 <>2007ja:GOOGLE Larry Korb and Peter Singer, and also search warnewsradio.org for info on private contractors in USA mlt, very active in IRQ & AFG, including foreign cmp~. As many as 60 thousand US soldiers are not USA citizens.

<>2007mr12:Financial Times (London)|>Hoyos,Corola|>7ssN| "The New Seven Sisters: Oil and Gas Giants Dwarf Western Rivals" [E-TXT]| ((The old "Seven Sisters" appeared to be eclipsed by emerging, largely state-owned companies. Financial Times consulted with industry executives to produce this list of new seven sisters =

Saudi Aramco (SaA)
Gazprom (RUS)
CNPC (CHN)
NIOC (IRN)
PDVSA (VNZ)
Petrobras (BRZ)
Petronas (MLZ)

In the 1990s the 7ss shrank to 4ss [=7ss.lgc (BP.crp.nrg | Chv.crp.nrg (having absorbed Gulf and Socal) | ExxM.crp.nrg (having absorbed Mobil) | Shell.crp.nrg)]. Now the 4ss produced ca. 10% of global oil and gas and held just over 3% of rzv~. Because the 4ss are so highly integrated [u&d], they still earned much higher profits than the new 7ssN abv))

<>2007je05:Reuters dispatch|>Roberts,Kristin| "U.S. needs Kyrgyz base to fight Taliban: Gates"| BISHKEK (Reuters) - U.S. Defense Secretary Robert Gates said on Tuesday Washington's agreement to use a military air base in Kyrgyzstan was necessary to support the war in Afghanistan.

Last month Kyrgyz lawmakers urged the government to evict U.S. troops from the base which is an important hard currency earner for the impoverished C.ASAn state.

"I think what's important for the people of Kyrgyzstan to understand is that our use of Manas (Air Force Base) is in support of a larger war on terrorism in which Kyrgyzstan is an ally of virtually every other nation on earth," Gates said.

"We are all working to try and prevent a resurgence of the Taliban in Afghanistan and our use of Manas is one way in which Kyrgyzstan can play a very important and constructive role in cooperation with many other nations, just not the United States," he told reporters after meeting Kyrgyzstan's minister of defense.

The United States has about 1,200 U.S. troops in Kyrgyzstan. Kyrgyz officials have demanded Washington pay more for the use of the base.

Gates defended the 2001 military agreement that allows the United States to use the base in the former Soviet nation.

"The arrangements that we have at Manas are similar to those that other nations have who have military forces here in Kyrgyzstan," Gates said, in a veiled reference to Russia.

"I think that seems appropriate."

The U.S. military presence in C.ASA suffered a blow in 2005 when Uzbekistan expelled U.S. troops from a base following Western condemnation of the use of force to quash a revolt in the town of Andizhan.

<>2007au15:Reuters dispatch|>Doyle,Alister [ecx ggr.plt] Environment Correspondent| "Russia's seabed flag heralds global ocean carve-up"| OSLO (Reuters) - A Russian flag on the seabed beneath the ice of the North Pole is among the few signs that states are waking up to a 2009 deadline for what may be the last big carve-up of maritime territory in history.

By some estimates, about 7 million sq km (2.7 million sq miles) -- the size of Australia -- could be divided up around the world with so far unknown riches ranging from oil and gas to seabed marine organisms at stake.

Only eight claims have been made although about 50 coastal states are bound by a May 13, 2009, deadline for submissions under a U.N. drive to set the now vague outer limits of each country's sea floor rights under a 1982 convention.

"We are clearly behind schedule," said Peter Croker, a senior Irish official who is the outgoing chair of the U.N. Commission on the Limits of the Continental Shelf, which examines coastal states' submissions.

"There's quite a lot at stake. But there has been a bit of inertia," he said.

Russia, Australia, France and Brazil are among the few to have made claims. Most spectacularly, Moscow announced this month that explorers had planted a rust-free Russian tricolor beneath the North Pole in waters 4,261 meters (13,980) deep.

Under the 1982 Law of the Sea Convention, coastal states own the seabed beyond existing 200 nautical mile zones if it is part of a continental shelf of shallower waters.

Some shelves stretch hundreds of miles before reaching the deep ocean floor, which is owned by no state. The rules aim to fix clear geological limits for shelves' outer limits but are likely to lead to a tangle of overlapping claims.

LAST SHIFT

"This will probably be the last big shift in ownership of territory in the history of the earth," said Lars Kullerud, who advises developing states on submissions at the GRID-Arendal foundation, run by the U.N. Environment Programme and Norway.

"Many countries don't realize how serious it is."

Yannick Beaudoin, who also works at GRID-Arendal, said: "2009 is a final and binding deadline. This allows you to secure sovereignty without having to fight for it."

The biggest controversies look likely to occur in regions where countries ring water, such as the South China Sea or the Arctic Ocean.

Isolated specks on the map, such as Easter Island or Ascension Island, could end up owning vast tracts of seabed. Off Africa, Madagascar may have a strong claim to a shelf stretching far south towards Antarctica.

Sorting out rights to minerals, geothermal energy or marine organisms far from the coast is becoming ever less academic as technology a dvances -- modern oil rigs can drill in water 10,000 feet deep.

Moscow's North Pole stunt, with explorers planting a flag with a mechanical arm from a submersible, was denounced by some other Arctic countries as a crude land grab.

Russia says a ridge under the Arctic Ocean makes the pole Russian, even though the coast of Siberia is 2,000 km (1,200 miles) away. Greenland, administered by Denmark which also says the pole is Danish, and Canada are at the other end of the same ridge.

"Other coastal states have as good a case as the Russians," said Lindsay Parson, an expert on continental shelf law at the University of Southampton in England.

OPEN QUESTION

Croker said it was an "open question" whether any state could back up a case for claiming the North Pole.

The polar dispute is about more than bragging rights to ownership of what many reckon is Santa Claus's home -- by some official U.S. estimates, the Arctic may hold a quarter of the world's undiscovered oil and gas [u&d#1].

"Companies can now exploit oil and gas in deeper and deeper waters," Parson said. "The more you know about resources the harder it is to be friendly i n sharing the seabed."

No firm is able to drill anywhere near the North Pole, but global warming may make the region more accessible.

Drilling group Transocean says its Discoverer Deep Seas holds the world depth record for oil and gas drilling, set in 2003 at 10,011 feet of water in the Gulf of Mexico.

"We are building four new enhanced Enterprise-class drill ships (in South Korea) that will be able to work in water depths of 12,000 feet and drill wells 40,000 feet deep," said Guy Cantwell, spokesman for Transocean.

Any state missing the 2009 deadline risks losing U.N. recognition of the claim. Countries that have not yet ratified the Law of the Sea Convention, including the United States, are not bound by the 2009 deadline.

The U.N. Commission cannot decide on overlapping claims, merely refer them back to governments to sort out -- a process likely to take years, or decades. Any extended rights will apply only to the seabed, not to fish stocks.

Experts say an extension of fishing limits to 200 nautical miles in the 1970s, the last big change of the ocean map, caused barely any conflicts. Britain and Iceland fought "cod wars", but with few casualties in clashes between frigates and trawlers.

Offshore disputes between neighbors such as Iran and Iraq are generally about resources closer to land.

Croker said the deadline might even promote cooperation.

"It could be a trigger for states to sit down and try to sort out these issues," he said, noting that Spain, France, Ireland and Britain had made a joint submission covering the Bay of Biscay. "It can work in a positive way."

Norway, one of the few countries to have made a submission, said it cooperated closely with neighbors such as Russia and Iceland. "We have shared our data at expert levels," said Rolf Einar Fife of the Norwegian Foreign Ministry.

 

 

 

 

<>2008ja26:ERG| “Russia expands energy empire with two distribution deals” The deals fuel worries about Russia’s control over energy supplies” [!!]| Douglas Birch (AP)| Russia “already” supplies

¼ of EUR gzz & nrg.p needs, and possesses

“almost 1/3” of wrl proven rzv~ and exports more gzz than anywhere else, and is

2nd largest nrg.o exporter after SaA| RUS “is the main conduit for oil and gas shipped from the former Soviet republics of C.ASA”| BUT= rtl claims that RUS may b e unable to meet customere’s demands by about 2010

Some “Western leaders” [later in rtl more specific ID but now evasive abt “leaders” = “Skeptics in Washington and some European capitals”] worry re. “growing dependence” granting “the Kremlin a powerful geopolitical weapon”| And now 2 agreements worth $2.2b w/SRB will make “the poor Balkan nation” an important distribution hub for RUS gzz| RUS has been “rushing” to build or buy EUG ptpt, storage facilities, ports and nrg cmp~| Skeptics say RUS uses nrg as “coercive tool of diplomacy”. Then !! = “The United States has led an effort to limit [Russia’s] inroads -- in part by planning new energy ptpt~ that would bypass Russian territory”| These alternative ptpt~ are not working out| !!= the EU’s “quest for energy independence has fizzled”| Chris Weafer, chief strategist at UralSib, a RUS investment bnk, sd, “You can now say that Russia has either won the war or is very close to winning the war” [reference, apparently, to competitive race (war) to create delivery routes to EUR]. EU sought non-RUS gezz supply routes “but failed to achieve anything. [...] The Kremlin moved much more quickly and much more decisively.”

 

<>2008jy08:BBC| Article on Blood oil in Nigeria
*2008jy27:BBC| " 'Blood Oil' Dripping from Nigeria"
*2012ja12:Nairaland Forum| re-"Bunkering" in Nigeria
*2012my22:BusinessDay| "Nigerian oil and thievery" In article, F/Shell/ F/international/
*2012oc:Consultancy Africa Intelligence [CAI] on illegal Nigerian oil
*2009au24:" 'Flaring' Gas for Want of a Pipeline"| ((ecx ptpt| CF=pix in 09de11:Reuters blw))
*2009de11:IRQ| "Iraq holds oil auction, Shell wins giant field"| Shell.crp.nrg.p.ggr

 

 

2010+:FOLLOWING ARTICLES ARE CONCENTRATED ON WEBPAGE nrg&plt.BYD =

*2011:Facts and Details| "China, Russia, Oil and Natural Gas" [E-TXT]
*2011ja27: "Oil Companies are Lured by Russian Petroleum" [E-TXT]
*2011no16:Centre for European Reform| "Russ, China and the Geopolitics of Energy in Central Asia" [C.ASA] [E-TXT]
*2011no18:China in Central Asia|"Russia, China and the Geopolitics of Energy in Central Asia" [E-TXT]
*2011de28:WoP| "A Would-be Energy Axis Between Russia and China" [E-TXT]
*2011je:Platts spc rpt on RUS nrg.p xpt
*2011oc11:BEIJING| Reuters dispatch by Gleb Bryanski on final RUS&CHN deal trade agreement
*2011se27:Bloomberg essay on Russian grain-trade ports
*2012:YouTube documentary, vs-frk = "Unearthed: the fracking facade" YouTube] ecx
*2012:Harvard Business School "Case Study" on Russian-Chinese energy relations
*2012mr13:EurActiv rpt on RUS xpt strategies
*2012sp: >Greenwald,Robert| "Iraq for Sale: The War Profiteers" YouTube | ((MIC IRQ))
*2012je01:LND & MVA, Reuters Tom Bergin & Douglas Busvine| “Russia offers to buy BP's $30 billion JV stake
*2012oc28:SourceWatch on nrg.c
*2012no01:George Hajjar, "Gulf states to invest $100 bn on 6000 km railway link" | ((rrd))
*2012de10:Natural Gas Europe| "The Gas Triangle: China, Russia and Europe" [E-TXT]
*2013:Panjiva| mpt/xpt xtx RUS/USA
*2013ja:Chesapeake CEO McClendon steps down after a year of tumult
*2013ja07:JRL| "NEWSLINK: Russia's Syria Support said to be a Losing Proposition"
*2013ja09:JRL|>Travin,Dmitrii| "Whatever happened to Russia's economic miricle?"
*2013ja18:JRL|>Medetskii,Anatolii|"BP Says U.S. to Outpace Russia for Oil Production"
*2013ja21:JRL| "Russian Energy Review in 2012: Consolidating State Control in an Uncertain Market"| Many other JRL rtl~ "Tags" | Re.gzz | | Re.GazProm | Re.Oil| Re.Rsn.crp.nrg| Twitter "tweets" re.nrg
*2013ja24:TTL| "Chevron increases stake in Iraqi Kurdistan Oil" w/MAP  IRQ
*2013ja24: "Iraq oil tensions rise as BP enters Kirkuk fray" BP.crp.nrg
*2013ja25:TTL| "Exxon enters the political fray ExxM.crp.nrg
*2013fe04:ArN| IRQ nrg.p xpt rise
*2013fe07:BBC| Ukraine rejeccts Gazprom bill
*2013fe13:MarketWatch| "Russia Could Double Oil Supply to China"
*2013fe13:Reuters| struggles of G20 host Russia ((stt&ekn Rsn.crp.nrg))
*2013fe13:LensBlog (NYT)| "Money for the Taking in the Niger Delta Swamps
*2013mr01:US issues Keystone pipeline report
*2013mr06:VNZ prx Hugo Chávez [>QavH] (1954-2013) died, obits
*2013my09:NYR:59-60|>McKibben,Bill| “Some Like it Hot”| ((ecx| Review of (1) Climate and Social stress, (2) Turn Down the Heat, (3) Collapse of Western Civ
*2013jy16:Forbes| "Rosneft at it Again, To Sink Billions More in New Oil Fields"
*2013fa:MXO| Labor unx~ join debates on [stt.fxx.vs-prv.fxx=] de-stt.fxx then prv.fxx energy sector of economy

*2013my+:ARTICLES ARE CONCENTRATED ON WEBPAGE nrg&plt.news

*2014je24:WDC Kennan Institute planned program on clash of energy dependence with concepts of ntn.stt.ndp, spc reference to ptpt

Bibliography
Many entries are organized according to a KIMBALL FILES data template =

<>Delimits an "entry", usually an author
For a given author, F/>Family-name,Given-name/ (NB! no space after comma) OR just F/>Family-name/
For a given book, F/|_Book Title/
For a given article, F/| "/
Hypertext hop from any blue & underlined title allows a survey of all that author's titles accessed in the UO Library
Briefly here is a guide to five frequent delimiters within <>Entries =
}m{ Opens field containing professional associations of the author
}r{ Opens field containing texts written by the author ("primary sources")
(( Double-parentheses delimit quotes and annotations -- often coded ))
}s{ Opens field of texts and other "secondary sources" about the author

<>Adelman,Morris Albert| a{}n{x cxx mlf}o{
}r{
*1972:B.MD,JHUP|_The_World Petroleum Market| ((>AWM| Greene.Strategies|

 [Following pgf frm Kaufman.Oil:3-15] As early as 1946 P. H. Frankel argued [l&r=] the economic logic of large integrated firms working closely together to control the various processes of the oil industry. According to Frankel, the high costs and risks of investment, combined with the lack of a self-adjusting market mechanism, resulted in centralized control of planning and the ultimate domination of the industry by a small group of integrated firms. Other economists have since expressed similar views and oil company executives have stressed the efficiencies allegedly inherent in integrated operations, a point Frankel also conceded. [P. H. Frankel, Essentials of Petroleum: A Key to Oil Economics, 2nd ed. (London, 1969), especially pp. 1-9 and 175-83. For a somewhat different analysis G/Hartshorn.Politics and G/1961au:JPE || In direct contradiction to Frankel, M. A. Adelman of the Massachusetts Institute of Technology has commented, "The nrg.pc oil industry, contrary to common belief, is inherently self-adjusting. Under competition, the level of output, and its divisions among various sources of supply, are set by the price acting upon the cost of bringing up more output. This incremental cost, for every individual unit and for the system as a whole, increases rather than decreases with greater output. It therefore serves as the governor of the producing mechanism in general and in any particular place." [AWM:13]. See also Edith T. Penrose, The Large International Firm in Developing Countries: The International Petroleum Industry (London, 1968), pp. 46-49 and 165-71
))

*1995:C.MA,MIT|>Adelman.Genie|_The_Genie out of the Bottle: World Oil since 1870| ((8x11=xerpt| Link is to on-line txt ; get detailed ToC [ix-xvi] | ch#3=41-68 "World Market to 1970" | ch#4&#5=60-140 1970-74:Oil prices in OPEC embargo era| ch#6=141-186 "OPEC at High Noon"| ch#7=187-242 1981-1986:"Cartel in Retreat| ch#8=243-426 1986[-1995] Stagnation

The "invisible hand" is not gentle. It slaps and cuffs sellers to stay in line and keep moving where they do not want to go, "to promote an end which was no part of his intention" (Adam Smith) [ID]. Sometimes it hits hard enough to kill. Sellers think they are entitled to a "fair'' price. Entitled or not, they can get it only by some kind of arrangement to evade or reduce competition. || The narrative theme of chapters 3 through 8 is how the owners of most of the world's oil resources have restrained production from an abundant oil supply to raise the price. To restrain output, they must first restrain one another. They feel the threat of a war of all against all. [...] What I once called "the clumsy cartel" tried to fine tune with coarse instruments. Hence the "energy crises" we examine. [Adelman.Genie:xxiii]
The political benefits of a lower oil price might be much greater than the economic. The flow of oil wealth makes some producing countries worth invading and gives others the means to invade or to threaten a shutdown around the Per.G. The smaller the oil revenues are, the less is the chance of aggression and of the producing governments' buying nuclear and other weapons. They are undemocratic, and there is no change of regime except by violence or conspiracy. Many of their inhabitants are in a pious rage. Those who disagree with them serve the Great Satan and deserve only death and the Fire. The less hard currency there is in such hands, the better off is the rest of the world. [Adelman.Genie:328]

))
}s{}t{}8{}

<>Ahrari,Mohammed E| a{}n{}o{
}r{
*1980:NYC,Arno Press|_The_Dynamics of Oil Diplomacy: Conflicts and Consensus| ((UO| 8x11:xerpt|trx & specific EGs of "alliances" among large tntn crp~ and among ntn.stt~))
}s{}t{}8{}

<>Al Arabiya| On-line journal devoted to news of the Arabic world| ((SaA))

<>American Economic Review|>AER|

<>Alternative Energy Sources| v#1=Sources, v#2=Current Controversies|>Gunkel,Darrin,ed| ((noUO| nrg.new))


<>Ames,Mark| a{
}r{
*2013my31: TXT re. puzzling US "neocon" affection for Chechen terrorists and its relationship to oil politics
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<>Aljazeera (news agency)|>Alj|


<>Anderson,Irvine H, Jr|*1975:NJ.PUP|_The Standard-Vacuum Oil Company and United States East Asian Policy, 1933-1941| (( Kaufman.Oil=195-200 sd Anderson emphasizes [that] oil and the federal government often followed the same course for different reasons. [CHN=] In the early 1930s the Standard-Vacuum Oil Company (StanVac) and Royal Dutch Shell were mostly concerned with protecting their marketing interests in Japan, Manchuria, and China, while American diplomats were more worried by Japanese violations of the Open Door treaty system. Similarly, toward the end of the decade, while StanVac and Shell were interested primarily in protecting their sources of supply and investment in the East Indies, policy makers were concerned mostly with matters of security and defense. Because institutional interests intersected, teamwork developed between the stt.dpt and the oil companies, as for example, when both in 1940 worked out a temporizing agreement to maintain limited oil supplies to Japan. But as relations between the United States and Japan deteriorated increasingly after 1940, control of oil policy centralized more and more in Washington. In the summer of 1941 the Roosevelt administration finally made the fateful decision to cut off all oil to Japan, thereby endangering Stanvac's (and Shell's) investments in the Indies. By this time Stanvac had become an agent rather than a participant in policy formulation. As Anderson concludes:

During August 1941 administration made policy. ... Since Stanvac was actually responding to requests of the Assistant Secretary of State and since [Secretary of State Cordell] Hull subsequently ratified the de facto embargo, it would be difficult to characterize Stanvac as anything other than an implementor in this phase also. Certainly the company suggested no new departures.17

<>Anderson,J.R.L|
*1969:LND|_East of Suez, A Study of Britain's Greatest Trading Enterprise


<>Arab News|>ArN


<>Bassiry,Reze|_Power vs. Profit: Multinational Corporation-Nation State Interaction|>Bassiry.Power| ((UO|stt&crp tntn.crp| 1977 Binghamton SUNY PhD Dissertation))

<>Beeby-Thompson,Arthur| n{}o{
}r{
*1908:LND|_The oil fields of Russia and the Russian petroleum industry : a practical handbook on the exploration, exploitation, and management of Russian oil properties, including notes on the origin of petroleum in Russia, a description of the theory and practice of liquid fuel| ((SMT| UO has other more gnr B-T pbc~ on nrg.p))
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}t{NO Wki
}8{}


<>Black,Edwin| a{}n{x nrg.new}o{
}r{
HOMEPAGE (with links to extended material on Black's publications)
*2006:NYC:St.Martin's|>Black.Internal|_Internal Combustion: How Corporations and Governments Addicted the World to Oil and Derailed the Alternatives| ((E-TXT excerpts| CF=0.pdg/wrl| Brd frm Powells| SMT| autos))
*2011:WDC,Dialog Press|>Black.Redline|_British Petroleum and the Redline Agreement: The West's Secret Pact to Get Mideast Oil| ((E-TXT excerpts |SMT AfroAsia))
*2008:WDC,Dialog Press|>Black.Plan|_The_Plan: How to Rescue Society the Day the Oil Stops -- Or the Day Before| ((E-TXT excerpts| SMT (Portland CC bbt, but no nrg.e link) ))
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<>Blair,John M| a{}e{1976}n{x}o{
}m{
Federal Trade Commission economist
Senate Subcommittee on Antitrust and Monopoly [SA&M]  chief economist
More Blair ID
}r{
*1952:WDC|_International Petrolelum Cartel| ((E-TXT excerpt))
*1969:1970; |_Government Intervention in the Market Mechanism
*1976:|>Blair.Control|_Control of Oil| ((OWN 78:NYC,Vintage pb| mpy cxx
Here is what Kaufman.Oil sd abt Blair.Control =

More recently, John M. Blair [...] has attacked the oil industry from a somewhat different perspective. Without denying Engler's assertions about oil's power over the public weal, Blair's emphasis has been on the industry's internal structure. A former economist for the Federal Trade Commission and the chief economist for the [SA&M] Senate Subcommittee on Antitrust and Monopoly, Blair has spent his career attacking the aggregation and concentration of economic and political power within the oil industry. Operating before WW2 on the basis of formal monopolistic arrangements [EG], including local and national cxx~, and after the war through a form of noncollusive oligopolistic interdependence, seven major oil companies [ID], Blair argues, have been able for the most part to control the flow of foreign and domestic oil, excluding outsiders. Thus, they have been gaining preferential tax treatment, limiting supply to demand, arbitrarily determining profit ratios, and, in general, making large profits at the public expense and with little concern for the national welfare. "Through the planned and systematic restriction of output at home and abroad," Blair concludes about the postwar period, "the oil companies directed their energies... toward maintaining domestic and world prices at or above the then unprecedented levels. And until the mid-1960s, these efforts met with a remarkable degree of success."6

[More Kaufman.Oil=] The Control of Oil has been rightfully acclaimed by many reviewers as the most incisive and damaging account yet published [as of 1978] on the oil industry. It is based on the wealth of information and expertise that Blair acquired over his career of almost forty years as an economist on vs-fdu and oil matters, including, in the 1950s, the preparation for the Federal Trade Commission of a now-famous report on the International Petroleum Cartel [ID]. The Control of Oil combines statistical analysis, elaborate documentation, and well-reasoned argument to expose the dimensions of power accrued within one industry controlling the arteries of national existence. Written from the perspective of the present energy crisis [1978], it also remains a cogent argument for the breakup of the oil industry [u&d=] into a system of independent, nonintegrated companies and for the development of new energy sources, most notably the oil shale deposits of the Rocky Mountain states.

[And yet more Kaufman.Oil=] ...accepting another author's analysis of the oil industry as "the greatest aggregation of effective economic and political industrial power which the world and nations have ever known," [Blair] concludes that "the historical role of the federal government has been not to restrain the industry but to make more effective its exploitation of the public interest."

[And still more Kaufman.Oil-= Other writers have stressed this point even more strongly. Indeed, John Blair, whose book The Control of Oil has been so widely hailed as the best account of domestic and international operations of the oil industry, dismisses almost entirely considerations of national INX~ in determining federal policy toward the multinational oil corporations. Illustrative of this fact is Blair's analysis of the import-quota legislation of the 1950s, the justification for which was national security but the results of which were sharp limitations on imports of cheap foreign oil, the maintenance of high domestic prices, and the hastened depletion of domestic rzv~. Rejecting the national-security concern as unlikely by itself to have brought about "such a far reaching change in national policy," Blair emphasizes instead a journalistic account of an alleged $1 million deal made by Treasury Secretary Robert Anderson just before he took office, the payment of almost half of which depended on the price of oil after Anderson assumed his post.14

[And finally 2 pgf~ frm Kaufman.Oil = ] Indeed, considering the rapid growth of oil demand during and after the 1950s and the fact that the refining and distribution of oil has been dominated since the 1880s by a small group of larger integrated firms, it is even possible to argue that the United States had no choice but to work through the major firms. This argument I reject for reasons outlined by John Blair who makes a convincing case for breaking up the large integrated corporations.25 Yet, Truman and Eisenhower believed it was necessary to rely on the major firms [,] and understandably so [,] considering that these firms were the only ones in the 1950s with established facilities for refining and distributing Mideast oil.

Therefore, although I remain fully cognizant of the oil-power thesis, with its emphasis on the control of government by oil, I reject its implication that foreign oil policy was largely a response to the private interests of oil. This seriously underestimates the corrosive impact of the Cold War and is, consequently, historically inaccurate.

Kaufman.Oil Intro ftn#25 = Blair.Control argues essentially against the natural-monopoly theory of oil, maintaining that the "competitive approach offers four fundamental theoretical advantages: prices are set at an economically desirable level, the level needed to bring forth the supply required to meet the existing level of demand; there is a constant downward pressure on costs, as less efficient producers must either modernize to meet the competition of their lower-cost rivals or go out of business; a constant stimulus is provided for [u&d#1] the discovery and development of new products and processes; and resources automatically move out of industries where they have become redundant and into those where they are needed." At the same time he dismisses such arguments against divestiture as the alleged competitive nature of the oil industry, its modest long-term profit showings, the practical problems of divestiture (such as the cost and mechanics of assets distribution, the drain on capital markets, and the effect on investors), and, most importantly, the supposed damaging effects on industrial efficiency. All these points, he shows, are subject to serious challenge. Finally, Blair concludes, the restoration (or, at least, the increase) of competition in the oil industry would minimize "the harm that can be done by any small group of individuals, thereby making influence and corruption more cumbersome, expensive, and of most importance, ineffective." Blair.Control:371-400

Here is Bert Ruiz's review of Blair.Control =

...a brilliant look at how the price of crude oil was determined by giant petroleum companies (the seven sisters) and a dozen members of the Organization of Petroleum Exporting Countries (OPEC). Blair traces the history of these controls and explains how they recklessly triggered the 1970's global energy crisis || ...Blair spent thirty-two years in the federal government. He started in 1938 as an author of monographs for pre-World War II investigations. Early on, he made his name focusing on the sizable concentrations of economic power in the oil industry by the Rockefeller family and family foundation. Afterwards he spent nearly a decade with the Federal Trade Commission as an Assistant Chief Economist and finally Blair spent fourteen years as Chief Economist of the Senate Subcommittee on Anti-trust and Monopoly. What makes this book truly special is the author's enormous access to critical government information || Blair [Blair.Control] describes the oil industry's principal tax preferences, which worked to the advantage of the major companies and against smaller nonintegrated companies that could have favorably altered the availability and price of oil to consumers. The author also goes into great detail to reveal how the "Arab Embargo" that set the stage for the massive oil price explosion of October 1973 - January 1974 had little impact on supply and that in reality there was no crude oil shortfall. Ultimately, Blair emphasizes the need for developing alternate energy sources in the future || This book had its genesis in a special 1973 Ford Foundation Energy Policy Project [EG]. The final result is a groundbreaking examination of the dramatic profits of oil companies.

Here is a very solid review by John P. Jones, III =

...the seminal account of the methods utilized to explore for, produce, and market one of the world's most important physical resources, petroleum. His account dates from the mid-70's, shortly after the loosely termed "Arab Oil embargo" [ID] At the time he was a professor at the University of South Florida, but he drew on his experience, and the data obtained through 32 years of work in the Federal government. In many ways, he was uniquely placed to write such a book. Overall, [Blair.Control] is written in textbook-style, with flat prose, and lots of charts and graphs. The account though is sprinkled with acerbic passages that underscore his central thesis that a small group of individuals, working for the major oil companies ("The Seven Sisters"), devote their efforts to determining, as they see it, an orderly manner in which this resource is sold to the general public, on highly lucrative and beneficial terms to the "guys in the backroom." Yes, Virginia, there really is a "free-market," but you see it exists in the minds of these guys, and their PR minions, as the most effective mechanism for diverting a glaring light from their decisions || Blair starts with the "energy crisis" of 1973, and proves rather convincingly that overall there was no restriction in supply, yet nonetheless, the price quadrupled, and even after the purported boycott was ended, the price remained at these elevated levels. The author devotes two chapters to the evolution of the control mechanism, both in terms of supply and marketing, and the concerted effort to exclude the "outsiders," those not in the club, and who would truly represent an aspect of a "free market." One of his most astonishing assertions concerns the establishment of a predetermined growth rate. Get ready for a little math, Virginia, but it is worth it. The math involves a regression line by least squares to the logarithms of the data... stick with it...and calculating a "coefficient of determination." His data involves the production from 11 quite different countries, over a 22 year period (1950-72). That coefficient is 99.9%(!) which means: "In other words, an assumption that oil production would increase at an average annual rate of 9.55 percent explains all but one-tenth of 1 percent of the actual change (p100-101) || The author is rich in details and anecdotes on the machinations that promote and maintain beneficial control. For example: "...the `Brownsville turnaround' scheme, by which imports were brought via tanker from Mexico and unloaded into trucks at Brownsville, Texas. The trucks would then transport the oil under bond 10 mile south across the Mexican border, where they would immediately turn around and reenter the United States carrying what was now transformed into `exempt overland imports.'" The "Majors", with large integrated operation, from exploration through the corner gas station, would be active politically, "buy some politicians", obtain very favorable tax preferences (ah, those "incentives,") and use them to punish the independents, a thesis told well, in one chapter entitled "The evisceration of the Libyan independents," followed by another entitled "The Crippling of the Private Branders." His conclusion at the end of the latter chapter: "Whether the product of a carefully engineered, precisely executed plan or the coincidental result of a series of adroit improvisations, problems that only three years earlier had appeared insoluble were now resolved. Their resolution set the stage for a virtual explosion of prices" || OPEC features prominently in Blair's account, but it is not the universal "bad boy" of the media. The author also looks at the strategic advantages of a higher oil price to the United State vis-à-vis Europe || It's not all whine and complain. The last part of the book outlines serious public policy objectives, and the mechanisms to achieve them, from conservation [enx.c] and technology to law, whereby this vital resource can be more equitable and strategically used in the national interest as opposed to the interest of the few. Written over 35 years ago, he covers shale oil, the use of lighter materials, and even electric cars. But he is hardly a Pollyanna, and although rationale alternatives are offered, he presciently describes the most likely scenario, the one that really has been followed: "If a regulatory agency were to propose any action strongly opposed by the industry, the probable subsequent sequence of event is not too difficult to predict. On the one side the agency's few overworked lawyers and economists would try to make a case based on limited amount of publicly available data, supplemented by such fragmentary information as could be pried out of the companies. On the other side, a veritable army of industry lawyers would not only contest the substance of the case by delay interminably... Based on `accepted' accounting principles, leading accounting firms would testify to the oil companies' financial impoverishment, while outstanding economists would emphasize the need for `adequate' earnings to support the industry's growth. Meanwhile, highly skilled public relations firms would be drumming up `grassroots' campaigns against harassment of the industry...Attacks, criticisms, and various forms of sabotage are also to be expected from other government agencies, many of which have long ago been infiltrated by the industry" || And verily, it has come to pass, in these intervening 35 years. "The Free Market" reigns, despite the 2008 "hiccup," and the quality of the brandy and cigars in the backroom has improved at least a magnitude. A depressing but essential read, that should be taken down from the back shelf.
))
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<>Bower,Tom| a{}n{x hst.gph.wrl}o{
}r{
*2009:L.ENG,Harper|>Bower.Squeeze|_The Squeeze: Oil, Money and Greed in the Twenty-First Century| ((Brd frm Powells))
*2010:NYC,Grand Central|_Oil: Money, Politics, and Power in the 21st Century| ((Brd frm Powells gnr| US ed of Squeeze abv| "A groundbreaking, in-depth, and authoritative twenty-year history of the hunt and speculation for our most vital natural resource...The story of oil is a story of high stakes and extreme risk. It is the story of the crushing rivalries between men and women exploring for oil five miles beneath the sea, battling for control of the world's biggest corporations, and gambling billions of dollars twenty-four hours every day on oil's prices. It is the story of corporate chieftains in Dallas and London, traders in New York, oil-oligarchs in Moscow, and globe-trotting politicians--all maneuvering for power..."--Dust jacket flap))
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<>Brackel,Oswald|*1903:BRL|_Der dreissigjährige petroleumkrieg: Eine handelswissenschaftliche studie| ((GRM ~~Nobels?))


<>Briody,Dan| a{}n{ mlf}o{
}r{
*2003:Hoboken.NJ,Wiley|>Briody.Iron|_The Iron Triangle: Inside the Secret World of the Carlyle Group| ((YouTube exposé featuring Dan Briody))
*2004:Hoboken.NJ,Wiley|>Briody.Halliberton|_The_Halliburton Agenda: The Politics of Oil and Money| ((OWN| Brd frm Powells| SMT Hlb.cmp| Hlb.bdg.crp| Brown.crp.bdg unx busting & devising slogan in TX = "Right to work" [88-91 w/quote from unx lwxer Nat Wells [ID] =

I say it's unfair to get the most public work of any contractor in the [89/90] state, and on every hour of that work for every man ... taking fifty cents and hour and adding it to his own millions.... You know, I'm pretty tired of that socialzied millionaire, who is sucking at the public teat, if you please, who has made his millions from your pocket and mine in tax money, starting with a dam down herfe by Austin, most of the highway work in the state, political connectdions that gets him lots of ederal work; that's your moneyh and my moneyh, our tax money....

WW2 gvt fxxership of bzn [97] Investment oportunities in post-WW2 war surplus [97f] gvt bdg of ptpt [98f] Petroleum Administration for War [99f G/PAW] E. Holley Poe [99f G/TX.E.ptpt] War Assets Administration [WAA] [100f] | Lyndon Johnson vs-CMN campaign vs- Leland Olds [ID] | 1965:1972; VTNam KBR contracts worth $390m| Deep water piers in Da Nang ~~Moris-Knutson & J.A.Jones acronymically RMK-BRJ [164f | W#1] | 1966:Evidence of thievery, mismanagement, false accounting, graft, etc = criminal "war profiteering"))
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<>Bronson,Rachel| a{}n{ SaA plt.irx}o{
}r{
*2006:OUP|>Bronson.Thicker|_Thicker than Oil: America's Uneasy Partnership with Saudi Arabia| ((Brd frm Powells| ndx| nrg.irx USA-SaA| Another foolish ToC))


<>Brown,Harrison| a{}n{}o{
}r{
_Challenge of Man’s Future: An inquiry concerning the condition of man during the years that lie ahead| ((Kmb| ecx ch5 "Energy":149-86))
}s{}t{}8{}

 

<>Brune,Michael| a{}n{ecx}o{
}m{
Rainforest Action Network, Executive Director
}r{
*2008:SFC, Sierra Club Books|_Coming Clean: Breaking America's Addiction to Oil and Coal| ((>2008:Brune| Exortation and encouragement to action))
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<>Burtis,David; Lavipour,Farid; Ricciardi,Steven; Sauvant,Karl P; eds|Σ|_Multinational Corporation-Nation-State Interaction| ((UO stt&crp stt&ekn))


<>Business History Review|>BH.rvw| n{}o{jrn}

 

<>Caroe,Olaf| a{}}n{}o{
}m{
*1939-1947: ENG [United Kingdom] Secretary of the Foreign Department of the Government of India, then Governor of NW Frontier Province
}r{
*1949mr:Round Table| rtl on menace of SSR,described by jrn edt as "...common interests which link the nations round the North Atlantic Ocean converge again upon the Persian Gulf; and ... there also they find themselves in proximity and rivalry with the same Soviet power whose menace confgronts them in Europe" [Lionel Curtis intro to Caroe.Wells:v]
*1951:LND,Macmillan|_Wells of Power: The Oilfields of South-Western Asia, a Regional and Global Study| ((UO| CWX 1950ja:MAP of ptpt~ of near east:94))

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<>Chandler,Alfred D., Jr| a{}n{Greene.Strategies cites}o{
}r{
"Standard Oil and the Early Development of the American Oil Industry"| Inter-Collegiate Case Clearing House, Harvard Business School (BH120)| ((Std.crp.nrg))
*1962:MA.C MIT|_Strategy and Structure: Chapters in the History of Industrial Enterprise| (())
*1965:NYC, Harcourt...World|_The_Railroads: The Nation's First Big Business: Sources and Readings| ((prm rrd))
*1969au:BH.rvw| “The Structure of American Industry in the Twentieth Century: A Historical Overview”|
*1988:B.MA,HarBusSchP|>Chandler.Essential|_The_Essential Alfred Chandler: Essays Toward a Historical Theory of Big Business|
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<>Chisholm,Archibald Hugh Tennant| a{}n{}o{
}r{
*1975:LND,Frank Cass|>Chisholm.First|_The_First Kuwait Oil Concession: A Record of the Negotiations, 1911-1934| ((SMT| CF=0.pdg/wrl| KWT crn!:xi-xv ))
}s{
Howard.Hunters:167-76 &ff
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<>Clark,Gregory and >Jacks,David| n{x fnc}o{}| “Coal and the Industrial Revolution, 1700-1869”|>Clark.Coal| pdf online| ((nrg.c mfgR| Compare with Freese.Coal:43-69 ))


<>Clark,William R| a{}n{fnc plt.irx SaA}o{
}r{
*2005:BC Gabriola Isl.,New Society Publishers|>Clark.Petrodollar|_Petrodollar warfare: Oil, Iraq and the future of the dollar| ((SMT| [Wki summary =] The petrodollar system originated in the early 1970s in the wake [?quarter century = "in the wake"?] of the Bretton Woods [ID] collapse. President Richard Nixon and his Secretary of State, Henry Kissinger, feared that the abandonment of the international gold standard under the Bretton Woods arrangement (combined with a growing US trade deficit, and massive debt associated with the ongoing Vietnam War) would cause a decline in the relative global demand of the U.S. dollar. [2007:You-Tube interview w/Kissinger on "New World Order"] In a series of meetings, the United States — represented by then U.S. Secretary of State Henry Kissinger — and the Saudi royal family made an agreement. The United States would offer military protection for Saudi Arabia’s oil fields, and in return the Saudi's would price their oil sales exclusively in United States dollars (in other words, the Saudis were to refuse all other currencies, except the U.S. dollar, as payment for their oil exports). || By 1975, all of the oil-producing nations of OPEC had agreed to price their oil in dollars and to invest surplus oil proceeds in U.S. government debt securities in exchange for similar offers by the U.S.

"the crucial shift in US monetary policy during the 1970s away from the gold standard to becoming the monopoly currency for worldwide oil sales, effectively enabling the US to dominate world trade. It then analyses global Peak Oil as an additional driver of US foreign policy and the parallel growth of political fundamentalism in the current US administration. Tracking the emergence of the euro as an important challenger to dollar supremacy, the book pinpoints Hussein's November 2000 switch to selling oil for euros as the defining moment for Iraq and, perhaps -- without an immediate change in governance -- for the noble American experiment."--Jacket.))
}s{}t{}8{}


<>Clarke,Duncan| a{}n{Σ}o{
}r{
*2007:LND|_The Battle for Barrels: Peak Oil Myths and World Oil Futures| ((SMT))
*2007:LND|_Empires of oil: Corporate Oil in Barbarian Worlds| ((SMT))
*2008:LND|_Crude Continent: The Struggle for Africa's Oil Prize| ((SMT| AFR))
}s{}t{}8{}


<>Coll,Steve| a{}n{x}o{
}r{
*1987:N.NY,Atheneum|>Coll.Taking|_The_Taking of Getty Oil: The Full Story of the Most Spectacular -- and Catastrophic -- Takeover of All Time| ((hst.gph= Early in book = "Cast of Characters" & that says a lot about the conceptual foundations of Coll's work -- powerful personalities at center))
*2004:N.NY,Penguin|>Coll.Ghost|_Ghost Wars: The Secret History of the CIA, Afghanistan, and bin Laden, from the Soviet Invasion to September 10, 2001| (())
*2012:N.NY,Penguin|>Coll.Private|_Private Empire: ExxonMobil and American Power| ((ExxM.crp.nrg| Has Coll matured since 1987?))
}s{
Wki
}t{}8{}


<>Cooper,Andrew Scott| a{}n{ plt.irx SaA OPEC IRN mideast}o{
}m{
Middle East Institute bio
}r{
*2008oc16:Middle East Journal | Andrew Scott Cooper interview (and other articles in that journal) [W]
*2011:NYC,Simon&Schuster|>Cooper.Oil|_The_Oil Kings: How the U.S., Iran, and Saudi Arabia Changed the Balance of Power in the Middle East| ((noUO SMT| CF=0.pdg/wrl| Brd frm Powells| An account of how the USA decision in the mid-1970s to choose Saudi Arabia as the dominant oil power in the Mideast ultimately led to the Islamic revolution in Iran, and how oil came to dominate USA domestic and international affairs. The author draws on newly declassified documents and interviews with some key figures of the time to show how Nixon, Ford, Kissinger, the CIA, and the State and Treasury departments, as well as the Shah of Iran and the Saudi royal family, maneuvered to control events in the Mideast. He details the secret USA-Saudi plan to circumvent OPEC that destabilized the Shah; reveals how close USA came to sending troops into the Persian Gulf to break the Arab oil embargo; and shows how the Ford Administration barely averted a European debt crisis that could have triggered a financial catastrophe in the USA. Cooper's Intro [TXT] ))

*2011se10:YouTube interview with Cooper
}s{}t{}8{}


<>Coopersmith,Jonathan| a{}
*1992:I.NY,CUP|_The_Electrification of Russia,1880-1926| ((>CER| nrg.e mfgR tkh R&A4.ekn RUS2|288p))


<>Croissant,Michael,et al.,eds|_Oil and Geo-Politics in the Caspian Sea Region| *1999:Praeger| ((SMT CSP.S ptpt ecx AZR RUS IRN KZX TKM TRK USA GRZ
Bülent Gökay|     "History of oil development in the Caspian Basin"
Cynthia M. Croissant and Michael P. Croissant| "The legal status of the Caspian Sea: conflict and compromise"
Jennifer DeLay|      "The Caspian oil pipeline tangle: a steel web of confusion"
Levent Hekimoǧlu|  "Caspian oil and the environment: curse or cure?"
Nasib Nassibli|        "Azerbiajan: oil and politics in the country's future"
Andrei Shoumikhin| "Russia: developing cooperation on the Caspian"
Nader Entessar|      "Iran: geopolitical challenges and the Caspian region"
Vladimir Babak|      "Kazakhstan]: big politics around big oil"
Vladimir Mesamed| "Turkmenistan: oil, gas, and Caspian politics"
Bülent Aras and George Foster| "Turkey: looking for light at the end of the Caspian pipeline"
Stephen J. Blank| "The United States: Washington's new frontier in the Transcaspian"
Michael P. Croissant| "Georgia: bridge or barrier for Caspian oil?"
))

<>Crosby,Alfred W| a{}n{nrg.gnr nrg.new}o{
}r{
*2006:NYC,Norton|_Children of the Sun: A History of Humanity's Unappeasable Appetite for Energy| ((good bbl))
((
*2006jy:Technology and Culture#47,3:638-639|>Pasqualetti,Martin J| Review of Children + "...Alfred Crosby plows old ground, but with the skill of an expert farmer who, although using the same seeds as everybody else, is able to coax bigger and better plants to take root and flourish. In fewer than 200 pages, he retells the magnetic story of humanity's progression from energy slave to energy king—starting with the simplest use of direct sunlight to the control of fire, from the domestication of plants and animals to the dominance of fossil fuels and the taming of the atom. Along the way, he offers morsels that stimulate the appetite for more and more helpings. While others might plant the same seeds, they have never ripened so attractively for the general consumer.

Crosby calls himself a cultural historian who focuses on ideas—especially those of technology—that change and influence the track of humanity. Tracing energy use over millennia, he deftly illustrates the relationships between new resources and each upward leap in civilization and population. In the process, he explains our evolving command of energy as the most important chain of events ever assembled for human benefit, and he is enthralled with the progress fashioned at each step. His words reveal a sense of personal astonishment and a tone of disbelief that humans have actually managed to be as clever as they have. He sees humanity's adoption of the forms and latitudes of energy as a series of miraculous achievements that assisted the exploration of the world and the development of lifestyles that everyone either has already or desperately wants.

To the scientist, the unadorned interplay of humanity and energy holds endless fascination, but Crosby's intended audience is wider than the academy. In this, as in many earlier books such as Ecological Imperialism (1986), he injects anecdotes while refraining from jargon and scientific parlance. This will not please everyone, of course. Readers may raise an eyebrow when he points out that, while oil resources could last another couple of generations, "that, dear reader, is well short of forever" (p. 139). They could be jarred into rereading the passage in which he acknowledges the difficulty of maintaining a fusion reaction in a laboratory by comparing it to "a man burning wet wood with a blowtorch" (p. 156). Might this style put off the more serious student of energy? Perhaps, but it will also attract readers, and they will marvel at how much they can learn even about complicated matters. Besides John McPhee, few other writers who address technical themes have the dexterity to be clear and appealing at the same time.

Thomas Jefferson [?! sic] once said that if he had had more time he would have written less. In a pithiness that gives testament to Jefferson, Crosby exhibits the confidence of someone whohas done a lot of thinking about technology and culture over decades of research and writing. One suspects that while he was in the midst of preparing earlier books he would periodically have flashes of insight about energy, and jot these down and file them away until they amassed enough bulk to merit this book.

Any shortcomings must be considered minor. [nrg.new=] Although Children of the Sun is a catchy title, it could mislead people into expecting a book entirely about the use of solar power. While Crosby's more expansive theme is found in the subtitle, the book may nevertheless surprise some readers. Alternative-energy enthusiasts could be caught up short when they read that nuclear energy is waiting "at our elbow like a superb butler" (p. 126). They might be further dismayed when Crosby suggests that we do not really have much choice about embracing nuclear energy because we cannot meet our needs without it.

Children of the Sun is impressive not because it touches on every facet of energy history, but because it does not. Its most attractive feature is its brevity.
}s{
Wki
}t{}8{}


<>Delaise,Francis|_Oil: Its Influence on Politics| *1922:LND,Labour Publishing Co| FRN lng ed = 1920:PRS|_Le Petrole| ((SMT (C.WA.U) ))


<>D’iakonova,Irina Alekseevna ∑| a{}n{R&A}o{}
*1980:MVA,Mysl|_Nobelevskaia korporatsiia v Rossii|
*1999:MVA,ROSSPEN|_Neft’ i ugol’ v ėnergetike tsarskoĭ Rossii v mezhdunarodnykh sopostavleniiakh| ((>DN&U| nrg.c))


<>DeNovo,John A| a{}n{}o{
}r{
*1956jy:AHR#61: 854-76|"The Movement for an Aggressive American Oil Policy Abroad, 1918-1920"| ((Kaufman.Oil cites))
*1963:Minneapolis|_American Interests and Policies in the Middle East, 1900-1939| ((UO| Kaufman.Oil cites| Mideast))
*1977mr:JAH#63:913-36| "The Culbertson Economic Mission and Anglo-American Tensions in the Middle East, 1944-1945"| ((Kaufman.Oil cites))
}s{}t{}8{}


<>DiGeorgia,James| a{}n{fnc (+) }o{
}r{
*2005:FL.Boca Raton,21st Century Investor Publishing|>DiGeorgia.Global|_The_Global War for Oil: A Survival Guide to the Coming Energy Shock| ((OWN frm Powells| Essentially a guide for investors = When crisis hits, be well positioned in gold| pro-bzn & vs-ntn.ndp among oilfield nations| See ch on IRN:113-23 -- no doubt, IRN will loose nuclear weapons on The West ))


<>Dixon,CJ >Drakakis-Smith,D and >Watts,HD,eds| n{plt.irx Σ}o{}
*1986:LND,Croom Helm|_Multinational Corporations and the Third World|>tntn&Twrl| ((ndx~! (crp.ndx) nrg.o MIC))


<>Duruigbo,Emeka A| a{}n{ mlf irx.lwx}o{
}r{
*2003:NY.ArdseyPark,Transnational Publishers|>Duruigbo.tntn|_Multinational Corporations and International Law: Accountability and Compliance Issues in the Petroelum Industry| ((ndx tntn.lwx irx.lwx))
}s{}t{}8{}


<>Ebel,Robert E|_Petroleum Industry of the Soviet Union| ((OWN| 1960au:USA delegation of nrg.p folks gt-SSR sponsored by Am.Petrol.Institute [API] Good detail))


<>Elwell-Sutton,Laurence P| a{1912je02}b{IRE}e{1984se02 }n{x plt.irx nrg.irx stt&ekn stt&crp }o{
}r{
*1975:W.CN,Greenwood|>Elwell.Persian|_Persian Oil: A Study in Power Politics| ((IRN))
}s{
Encyc.Iranica
}t{}8{}


<>Engdahl,F.William| a{}n{x}o{
}r{
*1992:Böttiger Verlags-GmbH|_A_Century of War: Anglo-American Oil Politics and the New World Order|
((SMT|>Engdahl.War1 contains >Ecrn:255-264 = Important dates in hst of Anglo-American oil politics, seen as an important facet of the "Round-Table" style global conspiracy| F/Ecrn/a ))
*2004:LND,Pluto|_A_Century of War...|>Engdahl.War2| Revised ed| ((SMT w/o Ecrn))
*2011:Wiesbaden,edition.engdahl|>Engdahl.War3|_A_Century of War: Anglo-American Oil Politics and the New World Order| ed#3 w/new final ch & NO Ecrn| ((Kmb frm Powells))
}s{
*--Wki bxo of "eccentric" CF=1968my:USA
}t{}8{}

 

<>Engler,Robert| a{1922jy12}e{2007fe23}n{x Σ plt.dms stt&crp cvc.pbl ekn.mlf}o{
}m{
City Unv. of NY PoliSci professor
}r{
*1961:N.NY,Macmillan|>Engler.Politics||_The_Politics of Oil: A Study of Private Power and Democratic Directions|
((F/Engler/ ndx| [Kaufman.Oil:3-15 Introduction=] Engler.Politics based on an exhaustive investigation of extant materials, including congressional hearings, government reports, and the oil industry's own publications, Engler.Politics remains an essential introduction into the oil industry's operations, including its internal machinations and efforts at public duplicity. Its principal theme, however, is oil's ability -- through its unique industrial structure, its inordinate wealth and influence, and its control over an essential commodity -- to subvert public policy for its own profit and power. Said Robert Engler:

The documentation . . . shows how the petroleum industry has harnessed public law, governmental machinery, and opinion to ends that directly challenge public rule. In the name of prosperity and technology, the industry has been able to destroy competition and limit abundance. In the name of national interest it has received privileges beyond those accorded to other industries.... In the name of freedom, the oil industry has received substantial immunity from public accountability [Engler.Politics:9] ))

*1977:C.IL:UCP|>Engler.Brotherhood|_The Brotherhood of Oil: Energy Policy and the Public Interest| ((ndx|
[Kaufman.Oil:3-15 Introduction=] Engler.Brotherhood continues his earlier line of argument except in harsher terms| Kaufman.Oil links Engler.Brotherhood w/ O'Connor
Here is a later Kaufman.Oil 2-pgf crt = [Engler.Brotherhood]...portrays the oil industry in an especially sinister fashion, suggesting it is corrupting public officials as high as the White House itself, being corrupted in return ("was there an extortion racket being run out of 1600 Pennsylvania Avenue?" Engler asks finally with regard to the Nixon administration), and generally resorting to whatever measures are necessary to maintain its "private government" of power. Perhaps more than any other writer, Engler accepts a conspiratorial analysis of oil-government relations, although typically this is never stated forthrightly.19

Yet, although Engler's work is characterized by elaborate documentation and extensive expository footnotes and much of what he says is persuasive (as is his earlier and, in my opinion, more compelling work, Engler.Politics), his "evidence" frequently amounts to nothing more than the type of polemical devices to which I have already referred. Accepting a corporatist (or revisionist) analysis of foreign policy, for example, he comments on a "symbiosis between the objectives of the government of oil and the governments of the United States and South Vietnam" VNM with respect to the Vwrx, even though he states earlier, "One cannot show that the oil corporations were central to decision-making about Vietnam."20 It is the type of innuendo implicit in the use of such a term as "symbiosis," which can imply anything from an intersection of interests to outright collusion, that I find particularly worrisome, especially when it results in such a mistatement of fact as Engler's earlier remark that, "As always, the State and Justice Departments were predictably supportive of corporate needs for cooperation."21))

*1980:N.NY,Pantheon|>AmE|_America's Energy: Reports from The Nation on 100 Years of Struggles for the Democratic Control of Our Resources| Engler= edt| ((cvc.pbl stt&ekn| pt1=nrg.c:3-51| nrg.e hydro:55-124| nrg.p:127-300| nrg.x:303-363| nrg.new:367-395))
}s{
Wki
}t{}8{}


<>Everest,Larry| a{}n{}o{
}r{
*2004:Monroe,Maine, Common Courage Press|_Oil, Power and Empire: Iraq and the U.S. Global Agenda|>Everest.Oil ((SMT| CF=0.pdg/wrl| Brd frm Powells| Excerpt from Everest.Oil Introduction:4-17 [TXT]))
}s{}t{}8{}

 

<>Fatemi,Faramarz S| a{}
*1980:South Brunswick.NJ,A.J.Barnes|_The_USSR in Iran: The Background History of Russian and Anglo-American Conflict in Iran,Its Effects on Iranian Nationalism and the Fall of the Shah| ((>FUiI| irx ENG R&A5.CWX Twrl Iran nrg.p))

 

<>Ferguson,Niall|
*1999:NYC,Viking|>Ferguson.House||_The_House of Rothschild: The World's Banker, 1849-1999| ((bnk wrl.fnc|RUS:184-6| RTwrx era:305-8| RUS.nrg.p:355| nrg.p & other Wtt era fnc:378-84| RUS MIC in WW1 era:413-36| RUS in WW1:431-49))

<>Feis,Herbert| a{}n{}o{
}r{
*1947:NYC|>Feis.Seen|_Seen from EA: Three International Episodes| (())


<>Ferrier,Ronald W. and >Bamberg,James H|_The_History of the British Petroleum Company| [E-TXT] ((BP BP.crp.nrg CF=Fursenko.Oil))


<>Fine,Ben| a{}n{}o{
}r{
*1990:LND,Routledge|>Fine.Coal|_The_Coal Question...| ((nrg.c F/.Coal/| Complex technical ekn account, but Intro:xi-xiv lays out main issues (EG=privatization) ))
}s{
Univ. of LND vita
}t{}8{}


<>Fischer,Louis| a{}n{}o{
}r{
*1926:NYC,Internaitonal Publishers|_Oil Imperialism: The International Struggle for Petroleum|
}s{
Spartacus Educational (biography) [TXT]
Wki
}t{}8{}


<>Freese,Barbara| a{}n{}o{
}r{
*2003:NYC,Penguin|>Freese.Coal|_Coal: A Human History| ((Kmb frm Powells| nrg.c| Personal and summary intro:1-14| Coal & mfgR:43-69 [compare with Clark.Coal]| coal,politics,society:77-81, 129-42| tpt= ships & trains:84-101| WW1:156-57| CHN:199-231| ecx issues:148-56, 163-97, 233-48 ))
}s{}t{}8{}


<>Frehner,Brian| a{}n{plt.dms USA}o{
}m{
Oklahoma State University History Department webpage
}r{
*2010:Santa Fe NM,School for Advanced Research Press|Frehner and >Smith,Sherry, eds|_Indians and energy: Exploitation and opportunity in the American Southwest|
*2011:Lincoln,University of Nebraska Press|_Finding Oil: The Nature of Petroleum Geology, 1859-1920| ((E-TXT excerpt| u&d#1))
}s{}t{}8{}


<>Fursenko,Aleksandr Axr*| a{}n{x}o{
}g{NB! ssn big plt pzn in new RUS
}r{

|“Pervyi neftianoi eksportnyi sindikat v Rossii (1893-1897)”|>Fursenko.Pervyi| In Monopolii i inostrannyi kapital v Rossii| ((|))
*1961:MVA-LGR,AkN|>MKvN,1| _Monopolisticheskii kapital v neftianoi promyshlennosti Rossii, 1883-1914: Dokumenty i materialy| F. = edt, w/Shepelev,LE & Gefter,MYa | Guliev,AN | (())
*1973:MVA-LGR,AkN|>MKvN,2|_Monopolisticheskii kapital v neftianoi promyshlennosti Rossii, 1914-1917: Dokumenty i materialy| F. = edt, w/ Shepelev,LE & Gefter,MYa | Guliev,AN | and now Volobuev,PV| (())
*1965:MVA|_Neftianye tresty i mirovaia politika 1880-e gg)| ((>Fursenko.tresty| [G/876:Baku] [Greene.Strategies]))
*1985:LGR,Nauka|_Neftianye voiny (konets XIX -- nachalo XX v.)| ((>Fursenko.voiny))

*1989:N.NY,Routledge|_Oil in the World Economy| F.= edt w/ Ferrier,Ronald W| ((>Fursenko.Oil))
*:|MANY pbc~ [EG=Xrw's CWX]
}s{}t{}8{}


<>Ghosh,Pradip K,ed|_Multi-national Corporations and Third World Development| ((>Ghosh.tntn| tntn.crp~ & Twrl| "High-level managerial skills may reduce the probability of explosive political developments but they will not entirely remove it. This is especially so where economic development brings about extreme levels of inequality, as it has in Brazil. Indeed, the history of nations since World War II suggests that the more open the political system, the greater the probability of economic turmoil, political fragmentation, and political repression (military or otherwise)" [!!] [25] ))


<>Goldman,Marshall|_Petrostate: Putin, Power and the New Russia| *2008:Ox,OUP| ((>GPP| RUS plt.dms stt&crp))


<>Greene,William N| a{}n{x plt.irx plt.dms (+) }o{}
*1985:MI.AnnArbor,UMI Research Press|>Greene.Strategies|_Strategies of the Major Oil Companies| ((In this dtf much Greene.Strategies txt has been integrated with main crn abv and labeled "Greene.Strategies", often including  Greene.Strategies codes in parenthesis that label Greene's interpretive major categories of oil company strategy. You can F/ [ID] the following Greene.Strategies categories of strategy =
F/(EC/ for Environmental conditions (ecx)| EG= F/(EC02)/
F/(R/ for Resources| EG= F/(R0/ F/(R1/ F/(R2/ F/(R3/ F/(R4/ F/(R5/ F/(R6/ F/(R7/ F/(R8/ F/(R9/
F/(H/ for Handicaps | EG= F/(H02)/
F/(SR/ for Social responsibilities| EG= F/(SR04)/
F/(PV/ for Personal values| EG= F/(PV05)/ & F/(PV06)/
F/(PL/ for Policies| EG= F/(PL/

Some periodicals cited in Greene.Strategies
1930:API.Facts (3d ed.)
Europe Documents
Europe Energy
*1912de15:NYT
*1952:FTC
*1961no25:Business Week
*1975mr24:Barron's
*1975oc06:Business Week
*1975de08:Business Week
*1976jy26:Business Week
*1977ja31:Business Week
*1977mr15:Forbes
*1977je13:Business Week
*1977oc15:Forbes
*1978my26:Forbes
))


<>Gulishambarov,Stepan| a{}n{}o{
}r{
*1882: kng~ on Baku and nrg.p industry
*1883:| on heating [wtpt & rtpt=] steamers and locomotives with nrg.p
*:|_The_Petroleum Heating of Room, Kitchen, Bakery, and Other Ranges| ((*2006:Oil of Russia#1|>Troshin,Anatolyi| "Another Face of Kerosene"|,”the Russian engineer and technician Stepan Gulishambarov wrote: “Thanks to the simplicity of kerosene ranges' construction, the substantial concentration of a great quantity of heat in a small space, the low cost of the fuel, and a large number of other minor conveniences, these ranges have rapidly become popular around the world and have penetrated wherever kerosene has done so. At present, one can find a multitude of kerosene kitchen ranges offered for sale: in every European country, and particularly in Great Britain, several hundred patents have been issued for them; in the United States of America, the number is probably several thousand” [SOURCE]
}s{ (BSE3) }t{}8{}


<>Gustov,SV |>Sokolov,AR |>Miriurin,DV|>2VRG|_Dva veka rossiiskogo gaza: v 3 tomakh| 3vv| Tom 1: Peterburg - kolybel' rossiiskogo gaza. 1811-1917| *2010:SPB,Liki Rossii| ((304pp, lxt nrg.g Dvesti let nazad v Sankt-Peterburge vydayuwwimsya russkim injenerom Petrom Sobolevskim byl sozdan apparat po vyrabotke iskusstvennogo gaza, qto oznamenovalo rojdenie gazovoi otrasli v Rossii. Izdatel'skii proekt "Dva veka rossiiskogo gaza" vpervye daet vozmojnost' wag za wagom prosledit' vsyu istoriyu otrasli. Pervyi tom izdaniya, "Peterburg - kolybel' rossiiskogo gaza", posvyawwen samomu neissledovannomu periodu - sobytiyam XIX - naqala XX vekov. Udivitel'no, no dolgoe vremya istoriya zarojdeniya gazovogo xozyaistva byla nezaslujenno zabyta
))


<>Harrington,EI| a{}n{}o{no easy GOOGLE}
*1937jy05:+3 further issues; California World and Petroleum Industry| "General Petroleum Corporation"| (())


<>Hartshorn,JE| a{}n{x nrg&ekn nrg&plt.irx (+) }o{
}m{
Economist jrnist
}r{
*1962:NY,Praeger|>Hartshorn.Politics1|_Politics and World Oil Economics: An Account of the International Oil Industry in its Political Environment| ed#1| ((>Hartshorn.Politics1| Kaufman.Oil:15f sd H  stresses the competitive nature of the oil industry notwithstanding its oligopolistic character [Kaufman.Oil has book title in error =  "Oil Companies and Governments"] Intro ftn in Kaufman.Oil:15f says H [misnamed in Kaufman.Oil] stresses the competitive nature of the oil industry notwithstanding its oligopolistic character = "Hartshorne emphasizes especially the differences in the various agreements among the companies for the production of oil, which, he believes, may give one company a decided advantage over the others." Hartshorn.Politics1:182-3 says=] "To me, this presents itself as a technique of 'non-price competition,' or at any rate of competition not necessarily affecting prices to customers, that nobody could call imaginary." Kaufman.Oil sd H believes that because of vs-fdu pressures, the major companies have been forced to "lean over backwards in order to maintain postures of exaggerated apparent competition, and to refrain from overt consultation in many issues upon which it would be logical to crystallize through open agreement." H concludes, ". . . it might be better for all concerned if this industry ... were not judged, and had not always to explain its practice, in the terms of an early nineteenth-century produce market." [H:222-23 See also ... [G/1961au:JPE]
))

*1967:LND|_Politics and World Oil Economics: An Account of the International Oil Industry and Its Political Environment| ((>Hartshorn.Politics2|noUO| Preface to ed#2 = things brought "up to date" but also "I have modified and attempted to clarify my views" EG=oil pricing has been wholly rewritten; and I have revised my views on the way that oil cns formulae might evolve to take account of the way that [OPEC] has to date been able to hasten their evolution"| Back in Hartshorn.Politics1 days I was ndp jrnist: now I am an "energy consultant" with "a somewhat closer, profession relationship with a number of oil companies and governments" [14]

CHAPTER 12 "Self-sufficiency in Oil: I. The United States" especially clear but gentle on the question of dependence of nrg.p cmp~ on gvt regulation, EG=TX Railroad Commission [TX.rrd.kmm] & H quotes the old saw about how much depends on "whose ox is gored" [IE= gvt off their backs but glad to have it on someone else's back] [Hartshorn.Politics2:211-29 | ed#1=192-209]

CHAPTER 13 "Self-sufficiency in Oil: II. The Soviet Bloc" [Hartshorn.Politics2:230-41 | ed#1=210-22] brought up to date in ed#2, but no substantial changes
))
*1993:C.ENG,CUP|_Oil Trade: Politics and Prospects| ((>Hartshorn.Oil| ch#1=gnr assessment of wrl nrg.p in 1990s| ch#7:138-68 "Governments in the Oil business"| ch#9:169-94 "The Opec performance"))
}s{}t{}8{}


<>Hefner,Robert A,III|_Grand Energy Transition: The Bridge Fuel to Our Sustainable Future| ((ecx EEE| H is Founder and Owner of GHK (a private nrg.gas company headquartered in Oklahoma City). He pioneered ultra-deep natural gas exploration and production. GHK led the development of innovative technology needed to successfully drill and produce many of the world's deepest and highest pressure natural gas wells - setting many industry world records along the way. In the 1970s, Hefner was a leader in the industry's successful efforts to deregulate the price of natural gas. These technological and political accomplishments led to the development of vast new domestic natural gas resources))


<>Heinberg,Richard| a{}n{ecx EEE lcl.ddd}o{
}m{
Core faculty mmb at New College of California in Santa Rosa CA
}r{
7 kng~ urging action for a sustainable future
*2005:Canada(BCGabriola Island),New Society Publishers|>Heinberg.Party|_The Party's Over: Oil War and the Fate of Industrial Societies| ed#2| 2003:ed#1| ((OWN| nrg&plt.irx nrg&plt.dms "industrial civilization is based on the consumption of energy resources that are inherently limited in quantity, and that are about to become scarce. When they do [and even before they do], competition for what remains will trigger dramatic economic [?and domestic political?] and geo-political events; in the end, it may be impossible for even a single nation to sustain industrialism as we have know it during the twentieth century" [1]| Alternatives [137-84] plt prognosis = "If the Right gains the upper hand, the result willl probably be the undermining of civil liberties; the scapegoating of leftists, minorities, and foreigners; and the expansion of military and police powers. Democracy will become a ritualized sham at best. If the Left gains the upper hand, the result might be a kin d of modern peasant revolt, in which the wealthy will be demonized and punished." [209] Neither of these paths offers any solution to the problems of energy depletion. Large-scale national life will deteriorate in the direction of decentralized, localized solutions = you and your family at home))
}s{}t{}8}


<>Henriques,Robert| a{1905}e{1967}n{}o{pst re.SamM
}r{
*1960:LND,Barrie and Rockliff|>HSW|_Marcus Samuel: First Viscout Bearsted and Founder of The 'Shell' Transport and Trading Company, 1853-1927| ((noUO noSMT?))
}s{
Wki
}t{}8{}


<>Hoffman,David E| a{}n{ plt.dms stt&ekn stt&crp RUS}o{
}r{
*2002:N.NY,Public Affairs|_The_Oligarchs: Wealth and Power in the New Russia|
}s{
Wki
}t{}8{}


<>Howard,Roger| a{1966 }n{Mideast }o{ jrnist
}r{
*2006:LND,Tauris|>Howard.Iran|_Iran Oil: The New Middle East Challenge to America| ((E-TXT| 8x11| IRN plt.irx AfroAsia))
*2008:LND,Continuum|>Howard.Hunters|_The_Oil Hunters: Exploration and Espionage in the Middle East, 1880-1939| ((Kmb frm Powells| chatty and novelic| u&d#1= D'Arcy [35-44] Gulbenkian [95-106] George Bernard Reynolds [45-56 & 71-82] Archibald Chisholm & KWT [167-76] A tribute to the great swashbuckling oil discoverers in the early "heroic" years of the petroleum phase of the ongoing industrial revolution ))
}s{}t{}8{}


<>Huber,Peter, and >Mills,Mark P| A series of creative publications, ca. 2005, on the energy crisis of the 21st c| [EG]


<>Hughes,T. P| a{}
*1983:|_Networks of Power: Electrification in Western Society,1880-1930| ((>Hughes.Networks| nrg.e tkh mfg CIV))


<>Ise,John| a{}n{}o{
}r{
*1926:C.NH,YUP|_The_United States Oil Policy|>Ise.Oil| (( enx.c of limited resource| lxt gushers))
}s{}t{}8{}

<>Inventory of Conflict and Environment|>ICE| ((ICE Search Engine| rvs ecx| American University hosts this site in a very irregular and unreliable way))


<>Jevons,W.Stanley| a{}b{}c{}d{}e{}n{x nrg.c}o{
}r{
*1906:|>Jevons.Coal|_The_Coal Question: An Inquiry Concerning the Progress of the Nation, and the Probable Exhaustion of our Coal-mines| ((F/.Coal/ for other titles| nrg.c.ggr))
}s{
Wki
}t{}8{}


<>Josephson,Emanuel M| a{}n{}o{
}r{
 *1952:NYC,Chedney Press|_Rockefeller “Internationalist”: The Man Who Misrules the World | ((Kmb| CWX vs-CMN prp = Rkf & his cmp~ are commie orx~| ch10:183-203 ("The Rockefeller 'Crusades' and the 'Oil War' " -- ITL Mussolini in Ethiopia)| ch11:204-26 ("The Rockefeller-Soviet Axis")| J. also pst Nearsightedness Is Preventable, and he wrote Breathe Deeply and Avoid Colds))
}s{}t{}8{}


<>Johnson,Arthur M| a{}n{}o{}
*1967:MA.C,HUP|>Johnson.ptpt|_Petroleum Pipelines and Public Policy, 1906-1959| ((pbl.tpt|))

 

<>Johnson's Russia List|>JRL


<>Journal of Political Economy|>JPE


<>Juhasz,Antonia| a{}n{x plm plt.dms nrg&wrx}o{
}r{
*2008:N.NY etc,Harper|>Juhasz.Tyranny|_The Tyranny of Oil: The World's Most Powerful Industry -- And what we must do to Stop It| ((Brd frm Powells))
}s{
Wki
}t{}8{}

 

<>Karl,Terry Lynn, et al. eds| n{}o{
}r{
*2007:LND|_Oil Wars| ((sbr| plt.irx wrx stt&crp NGR AGO QQN AZR(NaK) NDN(Aceh) (AMC=)CLM | ToC=
Nigeria: political violence, governance and corporate responsibility in a petro-state / Okey Ibeaunu and Robin Luckham
Drilling in deep water: oil, business and war in Angola / Philippe Le Billon
Greed and grievance in Chechnya / Yahia Said
Oil and conflict: the case of Nagorno Karabakh / Mary Kaldor
The conflict in Aceh: struggle over oil? / Kiersten E. Schulze
Oil and armed conflict in Casanare, Colombia: complex contexts and contingent moments / Jenny Pearce

What part does oil play in war? It's easy to conclude that Western intervention in countries such as Iraq and Afghanistan is primarily motivated by the West's desire to control precious oil resources. Is this also true of other conflicts around the world? The contributors argue that there is an essential problem in the way that recent "oil wars" have been conducted. When a country's infrastructure is destroyed and it is plunged into political chaos, as in Iraq, this provides neither security nor stability. Wars over oil further destabilize faltering regimes---with disastrous consequences
))

 

<>Kaufman,Burton I| a{}n{x plt.irx vs-fdu cxx}o{}
*1977sp:BH.rvw:35-56| "Oil and Antitrust: The Oil Cartel and the Cold War"| ((CWX))
*1978:CN.Westport & LND,Greenwood Press|>Kaufman.Oil|_The_Oil Cartel Case: A Documentary Study of Antitrust Activity in the Cold War Era| Contributions in American History, Number 72|

((
[Kaufman.Oil:3-15 Introduction hst.gph=] Since the oil embargo of 1973 and the mounting evidence of a world energy crisis that followed, the oil industry has become the subject of a rapidly expanding and, for the most part, highly critical body of literature. [EG=G/SNT.MC/ for plt.dms] Other factors having a similar effect have been the recent revelations of enormous gifts and campaign contributions by the oil industry to members of both major political parties and to foreign governments [pgf on mlf]. Several books suggest the tone and much of the substance of these recent investigations into what many regard as not only the world's largest and most important industry, but also its most powerful and autonomous industry.... Indeed, many of these new works on the oil industry have portrayed it as a sovereign entity with its own form of government and with sources of revenue and influence that have allowed it until recently to dictate pretty much the terms and conditions under which oil would be produced and sold throughout the world [G/Sampson.Seven | G/Solberg.Oil | G/Rand.dmk | G/Blair.Control | G/Engler.Brotherhood

Extended E-TXT, Kaufman.Oil=3-15 discussion of hst.gph specifically on governments and corporations [stt&crp] & more generally on governments and economies [stt&ekn]
G/OPEC
))

 

<>Kayal,Alawi D| a{}b{}n{}o{
}m{
*1975:1995; Saudi Arabia| Minister of Posts, Telephones and Telegraphs
}r{
*2002:|_The_Control of Oil: East-West Rivalry in the Persian Gulf| ((>Kayal.Control| SMT| CF=0.pdg/wrl| Brd frm Powells| Good gnr account pbd 30 years after written| w/hst past| Reprints 1968je24-25:OPEC Resolution XVI.90| Important statement of OPEC objectives and policies [176-81] Here is excerpt TXT of intro and conclusion ))
}s{
}t{}8{}

 

<>Keating,Aileen|>Keating.Mirage|_Mirage: Power, Politics, and the Hidden Histoy of Arabian Oil| ((Berdahl frm Powells))


<>Kimball,Alan| a{}n{}o{}
*1996: “Russia and Natural Gas in a New Era of International Commerce: How orderly is the New World Order?”| Paper presented to the Western Regional Slavic Association then later at a 1998 scholarly conference hosted by OSU| ((Incorporated, dusted or “dissolved” into this dtf| *1998mr18:Arthur Hanhardt email-Alan Kimball—“How refreshing it is to read of an academic paper that has natural gas as its subject rather than as either its product or medium”))


<>Kinzer,Stephen| a{ }n{ stt&ekn irx&nrg }o{ jrnist
}m{
Foreign correspondent for The New York Times who has reported from more than fifty countries on four continents
Served as the NYT’s bureau chief in Turkey, Germany, and Nicaragua
Columnist for The Guardian [EG]
}r{
*2003:|>Kinzer.Shah|_All the Shah's Men: An American Coup and the Roots of Middle East Terror| ((E-TXT| CWX IRN CIA trr))
*2006:|>Kinzer.Overthrow|_Overthrow: America's Century of Regime Change from Hawaii to Iraq| (())
*2013:|>Kinzer.Brothers|_The_Brothers: John Foster Dulles, Allen Dulles, and Their Secret World War| ((CWX NYT rvw E-TXT| Excerpts frm NYT rvw =

John Foster Dulles and his brother, Allen, were scions of the American establishment. Their grandfather John Watson Foster served as secretary of state, as had their uncle Robert Lansing. Both brothers were lawyers, partners in the immensely powerful firm of Sullivan & Cromwell [Wki], whose New York offices were for decades an important link between big business and American policy making.

Kinzer highlights John Foster Dulles’s central role in channeling funds from the United States to Nazi Germany in the 1930s. Indeed, his friendship with Hjalmar Schacht, the Reichsbank president and Hitler’s minister of economics, was crucial to the rebuilding of the German economy. Sullivan & Cromwell floated bonds for Krupp A. G., the arms manufacturer, and also worked for I. G. Farben, the chemicals conglomerate that later manufactured Zyklon B, the gas used to murder millions of Jews. Of course, the Dulles brothers’ law firm was hardly alone in its eagerness to do business with the Nazis — many on Wall Street and numerous American corporations, including Standard Oil and General Electric, had “interests” in Berlin. And Allen Dulles at least had qualms about operating in Nazi Germany, pushing through the closure of the Sullivan & Cromwell office there in 1935, a move his brother opposed.

Allen Dulles spent much of World War II working for the Office of Strategic Services [OSS], running the American intelligence operation out of the United States Embassy in Bern, Switzerland. His shadowy networks extended across Europe, and his assets included his old friend Thomas McKittrick, the American president of the Bank for International Settlements in Basel, a key point in the transnational money network that helped keep Germany in business during the war.

The OSS was dissolved in 1945 by President Truman, but was soon reborn as the CIA Kinzer notes that Truman did not support plots against foreign leaders but his successor, Dwight Eisenhower, had no such scruples. By 1953, with Allen Dulles running the CIA and his brother in charge of the State Department, the interventionists’ dreams could come to fruition. Kinzer lists what he calls the “six monsters” that the Dulles brothers believed had to be brought down: Mohammed Mossadegh in Iran, Jacobo Arbenz in Guatemala, Ho Chi Minh in Vietnam, Sukarno in Indonesia, Patrice Lumumba in the Congo and Fidel Castro in Cuba. Only two of these, Ho Chi Minh and Castro, were hard-core Communists. The rest were nationalist leaders seeking independence for their countries and a measure of control over their natural resources.

Ironically, Ho Chi Minh and Castro, strengthened perhaps by their Marxist faith, proved the most resilient. But the world still lives with the consequences of bringing down Mossadegh, who might have guided Iran, and thus world history, along a very different path. The 1953 CIA-sponsored coup that brought Shah Mohammed Reza Pahlavi to power was seared into Iran’s national consciousness, fueling a reservoir of fury that was released with the Islamic revolution of 1979.

The Iranian section of Kinzer’s book is especially strong. Here he calls attention to the cancellation by the Iranian Parliament of a contract for what was said to be “the largest overseas development project in modern history” with Overseas Consultants Inc., an American engineering conglomerate. But it seems likely that it was the Iranian Parliament’s vote to nationalize the oil industry that sealed Mossadegh’s fate. (Allen Dulles represented the J. Henry Schroder Banking Corporation, one of whose clients was the Anglo-­Iranian Oil Company.)

The brothers’ Manichaean worldview proved to be a poor tool for dealing with the complexities of the postcolonial era. Leaders like Lumumba and Mossadegh might well have been open to cooperation with the United States, seeing it as a natural ally for enemies of colonialism. However, for the Dulles brothers, and for much of the American government, threats to corporate interests were categorized as support for communism. “For us,” John Foster Dulles once explained, “there are two kinds of people in the world. There are those who are Christians and support free enterprise, and there are the others.” Rejected by the United States, the new leaders turned to Moscow.
))

}s{
Wki
}t{}8{}


<>Kiselyova,Emma, Manuel Castells and Alexander Granberg| a{}n{x}o{}
*1996:B:UP, Institute of Urban and Regional Development|>KML|_The_missing link : Siberian oil and gas and the Pacific economy| ((Ironic UO bbt rpt= "MISSING"| SBR nrg.p nrg.g PaR))


<>Klare,Michael T| a{}n{ nrg&wrx wtr}o{
}r{
*2002:N.NY,Holt|_Resource Wars: The New Landscape of Global Conflict| ((>Klare.Resource|OWN|nrg.p nrg.g & wtr etc, IE=Vital "resources"))
*2008:NYC,Metropolitan Books|_Rising Powers, Shrinking Planet: The New Geopolitics of Energy| ((>Klare.Rising| G/2005je22/ for major thesis statement|Janus description|ch5=CSP.S ch6=AFR|ch9:measured optimism abt future of nrg&irx| Brd frm Powells| re-RUS [Klare.Rising:88-114] ))
*2008:|>Klare.Blood|_Blood and Oil: The Dangers and Consequences of America's Growing Dependency on Imported Petroleum|
(( Brd frm Powells| Janus Video w/description| Blurb for video says this =
The notion that oil motivates America's military engagements in the Middle East has long been dismissed as nonsense or mere conspiracy theory. Blood and Oil, a new documentary based on the critically-acclaimed work of Nation magazine defense correspondent Michael T. Klare, challenges this conventional wisdom to correct the historical record. The film unearths declassified documents and highlights forgotten passages in prominent presidential doctrines to show how concerns about oil have been at the core of American foreign policy for more than 60 years – rendering our contemporary energy and military policies virtually indistinguishable. In the end, Blood and Oil calls for a radical re-thinking of US energy policy, warning that unless we change direction, we stand to be drawn into one oil war after another as the global hunt for diminishing world petroleum supplies accelerates.

))
*2012ja31:TomDispatch| ""| [E-TXT]
*2012mr13:TomDispatch| "Why High Gas Prices Are Here to Stay "| [E-TXT]
}s{
*2010je06:Slate Magazine|>Gross,Daniel| "Fracking, Oil Sands, and Deep-Water Drilling: The dangerous new era of "extreme energy"| [E-TXT]
Wki
}t{}8{}


<>Klebanoff,Shoshana|
*1974:NYC,Praeger|>Klebanoff.Mideast|_Middle East Oil and U.S. Foreign Policy; With Special Reference to the U.S. Energy Crisis| (( AfroAsia))


<>Klebnikov,Paul|>Khlebnikov,Pavel| a{}e{2004jy09}n{}o{
}m{
Chief editor of RUS Forbes [W]
RUS TV interview [YouTube, skip first minute]
*2004jy09:Assassinated [W]
}s{
Wki with its unfortunate opening phrase "historian of Russian history"
W#1 | W#2 | W#3
t{}8{}


<>Klinghoffer,Arthur Jay| a{}n{ RUS plt.irx}o{
}r{
*1976:|_Soviet Oil Politics ... and Soviet-Am| ((>KOP| nrg.p ~~R&A5.nrg ekn.plt))
*1977:|_Soviet Union and International Oil Politics| ((>KS&P| nrg.p))
*1985:Westview|_Israel and the Soviet Union: Alienation or Reconciliation?| ((ISR irx Jwx))
*1996:UPress of Am|_Red Apocalypse: The Religious Evoluton of Soviet Communism| ((mnt IDL SSR CMN as rlg))
}s{
}t{}8{}


<>Landeau,J.F. "Strategies of the Independent Oil Companies"| *1977:Harvard Business School DBA Thesis


<>LeVine,Steve| a{}n{}o{
}r{
*1995se09:NYT on "Western" effort to get ptpt from CSP.S to PAC.O [TXT]
*2007:N.NY,Random House|>LeVine.Glory|_The_Oil and the Glory: The Pursuit of Empire and Fortune on the Caspian Sea| ((CSP.S MPR| good gnr))
}s{
Wki
}t{}8{}


<>Lloyd,Henry Demarest| a{}n{}o{
}r{
*1894:NYC,Harper|_Wealth against the Commonwealth|>Lloyd.Wealth| G/1894:USA R&A [Full E-TXT] ((Progressive Era| Standard Oil))
}s{
Wki
}t{}8{}


<>Loftus,John A| a{}n{}o{
}r{
*1948:|>Loftus.Mideast|_Middle East Oil: The Pattern of Control| ((AfroAsia| CF: 1953se10:MEMO))
}s{}t{}8{}

 

<>Longhurst,Henry| a{}n{}o{}
*1959:LND,Sidgwick and Jackson|_Adventure in Oil: The Story of British Petroleum|With a foreword by The Rt. Hon. Sir Winston Churchill| ((BP.crp.nrg| Churchill= "I myself was closely associated with it in its early days in 1913 and 1914"| BP continues great story of "merchant venturers of Britain" [unnumbered p.5] ))


<>Longrigg,Stephen Hemsley (S.H.)| a{}n{}o{
}r{
*1968:LND,Ox,OUP|_Oil in the Middle East, Its Discovery and Development| ed#3| ((u&d#1| Favorable account of irx.bzn in AfroAsia, benefits to host territories and peoples))
}s{
Wki
}t{}8{}

 

<>Maass,Peter| a{}n{}o{
}r{
*2009:N.NY,Knopf|>Maass.Crude|_Crude World: The Violent Twilight of Oil| (( Official blurb = An examination of oil’s indelible impact on [NB! = ntn.stt~ that pmp & nsx~ w/nrg.p.ggr] the countries that produce it and the people who possess it. || Every unhappy oil-producing nation is unhappy in its own way, but all are touched by oil’s unfortunate power to worsen existing problems and create new ones. Crude World explores the troubled world oil has created—from SaA to IRQ, RUS, NGR, VNZ and beyond. The book features warlords in the oil-rich Niger Delta, petro-billionaires in Moscow, American soldiers and oilmen in Baghdad, the gesticulations and politics of [QavH] Hugo Chavez, as well as officials in Riyadh who avoid uncomfortable questions about Saudi rzv~. [CHN=] Crude World also ventures into Equatorial Guinea, the setting for misrule and corruption as well as a race for oil between American and Chinese firms. || Rebels, royalty, middlemen, environmentalists, indigenous activists, CEOs—their stories tell the larger story of petroleum in our time. Crude World is a journey into the violent twilight of oil that answers the questions of what we do for oil and what oil does to us.))
}s{
Personal webpage
}t{}8{}


<>Magner,Mike|_Poisoned Legacy: The Human Cost of BP's Rise to Power Σ|


<>Mann,Charles C| n{nrg.new frk}o{jrnist
}m{
Atlantic Monthly contributing edt
}r{
*2013my:The Atlantic Monthly|"What if We Never Run Out of Oil"| ((>Mann.Never| E-TXT))
}s{}t{}8{}


<>Margonelli,Lisa|_Oil on the Brain: Adventures from the Pump to the Pipeline| ((Kmb frm Powells| Pleasant but light-weight essays))


<>Marvin,Charles Thomas| a{854}e(990)n{RUS.nrg.p CSP.S MPR ENG.vs-RUS }o{ jrn & srv.irx
}m{
*1870:1876; Neva.R region (SPB) ngn.works, joined father who worked there| Learned RUS.lng
*1877jy16:LND| Joined GBR ENG.FO
*1878je26:jy16; axx-bcs "leaked" txt of "secret" RUS/ENG trt frm memory to gzt Globe| Released bcs no lwx vs-such an act
*1882:Joseph Cowen [Wki], brick zvd fxxer, famous rdx or left-lbx in Parliament, but pro-MPR, sent Marvin to RUS to get the low-down on RUS ddd in CSP.S rgn
}r{
*1880: First publication about RUS/IND question [so-called "Great Game"], after battle of Geok Tepe [Wki] Widely read in RUS, esp. among mlt.scl~
*1884:|>Marvin.Region|_The_Region of the Eternal Fire:An account of a journey to the petroleum region of the Caspian in 1883| ((E-TXT=1992 ed#2 (1887=signed new preface) with new final ch| ed#1 intro IDs "Kerosine factor of the Central Asian problem"| Especially acknowledges contribution of pst by Gulishambarov,Stepan [G] ))
*1885:NYC|_The_Russians at the Gates of Herat| ((RUS as purposeful and direct military threat to Brt.MPR, focussed on Herat, the gateway to IND))
*188?:LND|_The_Petroleum Question: England as a Petroleum Power, or, The Petroleum Fields of the British Empire| ((E-TXT via ILL))
*1887:LND|_The_Coming deluge of Russian petroleum and its bearing on British trade|
*1889:LND|_The_Coming Oil Age|
}s{
*--Wki
}t{}8{}


<>Matveichuk,AA and Fuks,IG|_Istoki rossiiskoi nefti: Istoricheskie ocherki| *2008:MVA,Drevlekhranilishche| ((>MIsN|SMT| 416pp| V istoriqeskix oqerkax na obwirnoi dokumental'noi osnove osvewwayutsya klyuqevye etapy zarojdeniya, stanovleniya i razvitiya rossiiskoi neftyanoi promywlennosti do 1917 goda))


<>Maugeri,Leonardo| a{}n{}o{}
*:Belfer Center, Geopolitics of Energy prj|_Oil: The Next Revolution|))


<>Mayer,Jane| a{}n{}o{ jrnist
}r{
Bio sketch and New Yorker |>NYer bibliography
*2010au30:NYer| “Covert Operations: The billionaire brothers [Kochs] who are waging a war against Obama” [TXT]
}s{
Wki
}t{}8{}


<>McCaffray,Susan Purves| a{}n{RS2 RREV1 mfg obx nrg.c tkh ntg, cptists w/RUS face}o{
}m{
Vita
}r{
*1996:D.IL:NIUP|>McCaffray.Politics|_The_politics of industrialization in tsarist Russia : the Association of Southern Coal and Steel Producers, 1874-1914| ((RUS2 874:Association represented nearly 60 firms responsible for nearly whole RUS nrg.c and steel production in south))
}s{
}t{}8{}

<>McKay re.RUS ptpt *1984:SlR:604-23|

<>McLean,JohnG and >Haigh,RW| a{}n{x u&d l&r}o{}
*1954:Harvard Univ. Division of Research, Grad. Sch. of Bus.Admin|>M&H|_The_Growth of Integrated Oil Companies| ((crp.nrg by crp.nrg analysis of various forms of u&d/l&r| CF=Greene.Strategies))


<>Mikdashi,Zuhayr| a{}n{x fnc}o{
}m{
SWZ|Lausanne.unv, prf-emeritus
Founding-director of Lausanne.unv Graduate School Institute of Banking and Finance
}r{
*1966:N.NY,Praeger|>Mikdashi.Financial|_A_Financial Analysis of Middle Eastern Oil Concessions: 1901-65| ((SMT| AfroAsia NOndx pdx=prm~))
}s{}t{}8{}


<>Miller,T.Christian| a{}n{x}o{
}r{
*2006:N.NY,Little,Brown&Co|>Miller.Blood|_Blood Money: Wasted Billions, Lost Lives, and Corporate Greed in Iraq|

((SMT IRQ.wrx|>M.crn:xiii-xviii G/M.crn/ for 25 sig.moments| ch4 = "The Halliburton Gang" = "As vice president, he [Cheney,Dick] pushed forward the war that brought the company [Halliburton] billions in new revenue. The federal [72/73] government awarded Halliburton half the value of all contracts issued in Iraq, an astonishing sum potentitally worth nearly $22 billion. The company's stock price rose from $20 to $83 a share over the Iraq war -- a stunning 300 percent increase." Waxman,Henry(CA HoR), and Lautenberg,Frank(NJ SNT) led plt fight vs- oil&war nexus. No wrx in USA hst has been as dependent on one cmp [72] USA mlt "depended on Halliburton for its existence". & it "made sure the country's petroleum flowed" [72]| KBR rose ~~LBJ & flx w/gvt contracts in WW2. 1965:1972; B&R bdg $2b worth of airfields, hospitals, & mlt bases. 1969:B&R=largest bng cmp in USA. But protesters called B&R "Burn and Loot". Defense scy Cheney pioneered "outsourcing" B&R = first sig. beneficiary. Cost+ contracts. LOGCAP turned over quartermaster mlt function to prv cmp~| Balkans wrx brought #2.2b in revenue to Hlb. B&R merged w/Kellogg,MW to create KBR.bdg.crp| Greenhouse,Bunnatine [84-87,90-1] ))
}s{
Wki
}t{}8{}


<>Mitchell,Timothy|| a{}n{x mdn}o{
}r{
WWWW.HOMEPAGE
*2011:LND/NYC|_Carbon Democracy: Political Power in the Age of Oil| ((Kmb frm Powells| SMT| dmk.plt.dms| Intro thoughtful trx disc. of dmk & energy [1-11]| nrg.c up to nrg.p age [12-31]| origins of AfroAsia oil [43-65]| WW1 & Versailles [66-85]| Versailles and era of League & of "Red Line Agreement" (IE=Achnacarry [ID])) [86-108]| ch5:107-43 "Fuel Economy", rise of idl "The Economy"|Twrl= vs-MPR & ntn.stt.ndp in "Third World" overturned early 20th-c EUR consensus (IE=global metropol "sabbotaged" by peripheries) [144-72]| OPEC era [173=99]| Jihad era = nrg & MIC became entwined [200-30]| Conclusion reflects on "end" of nrg.p era [231-54} BUT [EEE=] "Afterword" to pb ed has to assess new "fracking" era of nrg, including the "unsustainability" of continued carbon nrg [255-67] ))
}s{
Wki
}t{}8{}


<>Mohr,Anton| a{}n{}o{

}m{
}r{
*1926:NYC,Harcourt,Brace & Co|_The_Oil War| ((CF=Yergin.Prize))
}s{
*--Wki (Norwegian)
{}t{}8{}


<>Muttitt,Greg| a{}n{x}o{
}m{
Former co-director of campaigning charity Platform
Served as campaigns and policy director for the antipoverty organization War on Want
Lives in London
}r{
Articles in The Guardian, Financial Times, and The Independent
*2005no:"Crude Designs: The Rip-off of Iraq's Oil Wealth" [E-TXT]
*2008jy: "Iraqi Oil on the Block" [E-TXT]
*2012:|>Muttitt.Fuel|_Fuel on the Fire: Oil and Politics in Occupied Iraq| ((SMT IRQ.wrx| KIRKUS REVIEW [E-TXT] | Media Freedom International review [E-TXT] Story has 4 pt~ [1] & [2] Setting up CPA & crafting new IRQ.crp.nrg.p.lwx (G) [3] 2006sp:2007; al-Maliki gvt struggles w/zpd.crp.nrg~ & native IRQ nrg.p INX~ [4] 2007:2011; Big crp.nrg cmp~ take over| Oil.lwx [pt3,ch##13-19:145-227| ))
*?:YouTube
*2012jy16:Democracy Now YouTube
*2012jy26:YouTube interview
*?:Podcast interview
*2013fe14:Independent interview [E-TXT]
}s{}t{}8{}


<>Nash,Gerald D| a{}n{stt&crp}o{
}r{
*1968:Pittsburgh|>Nash.United|_United States Oil Policy, 1890-1964: Business and Government in Twentieth Century America| (( SMT| stt&ekn stt&cmp = central theme| "the need for government to cooperate with business and to assume the function of an arbiter in the new, highly industrialized society was emerging in America. [...] it became clear that the United States had undergone a silent revolution in adjusting its eighteenth-century political institutions to the exigencies of twentieth-century industrialism" [vi]. Cites Ise.Oil and Johnson.ptpt
*--Kaufman.Oil says Nash emphasizes the development of an economy characterized by a mixture of private and public enterprise, Nash stresses the development of cooperation as the prime characteristic of public policy in the petroleum industry. His book provides the type of balance lacking in many of the recent [1978] works on the oil industry, although his view of Eisenhower's oil policy does not agree entirely with my [Kaufman's] own [Nash=201-8]))


<>Nef,JU|_The Rise of the British Coal Industry| (1966) ((nrg.c| E-TXT))

 

<>Noreng,Oystein|_Oil Politics in the 1980s: Patterns of International Cooperation| *1978:NYC,etc, Council on Foreign Relations| ((UO))


<>Norman,James R| a{}n{x fnc}o{
}r{
*2008:OR.Walterville,Trine Day|>Norman.Oil|_The_Oil Card: Global Economic Warfare in the 21st Century| ((Kmb| Use of President Reagan's National Security Directive))
*2009fe:Jim Norman and George Noory 11-part YouTube interview (re.price manipulation to damage economies of rival states and companies [an old Std.crp.nrg policy now applied to plt.irx & irx.fnc]| Bank spying)
*2011ja:YouTube interview
*2012de20:Geopoliticus interviewed Norman [E-TXT]
}s{}t{}8{}


<>O’Connor,Harvey| n{ u&d}o{
}r{
*1955:NYC,Monthly Review P|_The_Empire of Oil|| ((>OConnor.Empire| Kmb frm Powells bzn.MPR| Intro ch=good gnr hst))
}s{}t{}8{}


<>O'Sullivan,MeghanL| a{}n{ IRQ plt.dms plt.irx}o{
}m{
 Jeane Kirkpatrick Professor of the Practice of International Affairs, Harvard Kennedy School
}r{
*2011jy:Belfer Center|"Iraqi Politics and Implications for Oil and Energy"| ((E-TXT))
}s{
ID
}t{}8{}


<>Oil and Gas International: World Industry News (Directory)| E-JRN|


<>Owen,Thomas on Imperial Russian capitalism| ((RUS MPR cptism))


<>Paniushkin,V and Zygar',M|_Gazprom: Novoe russkoe oruzhie| *2008:,Zakharov| ((256pp| Ggzz.crp Kniga pro Gazprom poluqilas' knigoi pro Rossiyu. Avtory smotreli na stranu qerez izvilistuyu gazpromovskuyu trubu i ponimali, qto esli by eta truba na kakom-to uqastke svoei istorii povernula inaqe, strana byla by drugoi))


<>Parkhomenko,VE| a{}n{

}r{
*1957:MVA,AkN|_D.I._Mendeleev i russkoe neftianoe delo| ((noUO,IA.State Unv.ILL| MndDI scs RUS.nrg.p))
}s{}t{}8{}


<>Pinelo,Adalberto J| a{}b{}n{ Peru stt.fxx xfxx}o{
}r{
*1973:NYC,Praeger|>Pinelo.Multinational|_The_Multinational Corporation as a Force in Latin American Politics: A Case Study of the International Petroleum Company in Peru| ((NOndx| tntn.crp AMC LAM CWX| 1922-1968 = "After fifty years of involvement in Peru, Std.NJ.crp nrg, one of the world's largest corporations with enormous annual profits and assets [in Peru via its International Petroleum Company (IPC)], was humiliated by the Peruvian government, as it had once humiliated Peru by threatening to shut off the fuel supplies" [145] ))
}s{
Northern Kentucky PoliSci dpt webpage
}t{}8{}


<>Potolov,SS|
G/Monopolistichesk
*:|_Khlebnaia torgovlia in 1890s


<>Rand,Christopher T| a{}n{ AfroAsia ISL plt.dms}o{
}r{
*1974ja:Harper's#248,1484:41-54 [E-TXT]
*1975:B.MA & Toronto,Atlantic Monthly Press|>Rand.dmk|_Making Democracy Safe for Oil: Oilmen and the Islamic East| (frontispiece (sp?) maps, first of N.AFR and second of middle east| Good intro on crp.nrg~ changing names and on chaos of tlng Arabic)
}s{
}t{}8{}


<>Randall,Stephen J| n{x fnc}o{
}r{
*1985:CAN Kingston|_United States Foreign Oil Policy, 1919-1948: For Profits and Security| ((plt.irx good gnr| USA plt.irx based on ensring adequate suppl of oil & ol products to meet mfg & mlt needs. Has projected USA into regions of INX~ defined solely by nrg.p & by no other broader irx INX))
*2005:CAN, McGill unv.Press|_United States Foreign Oil Policy Since World War I|ed#2 of similar title above| ((Brd frm Powells))
}s{
Wki
}t{}8{}


<>Rifkin,Jeremy| a{}n{ nrg.new ecx}o{
}m{
ca.2000-2011, 40% of his time ~~ EUnion “working with governments, the business community, and civil society organizations to advance the Third Industrial Revolution" [intro to Rifkin.Third]
}r{
*2002:NYC,Putnam|>Rifkin.Hydrogen|_The_Hydrogen Economy: The Creation of the World-Wide Energy Web and the Redistribution of Power on Earth| (("Two developments, in particular, are likely to figure prominently in the coming oil equation. || First, while the experts disagree about when global oil producton is likely to peak, they agree that when it does, virually all of the remaining untapped rzv~ will be left in the Muslim countries of the [AfroAsia] Middle East, potentially changing the current power balance in the world. The juxtaposition of dwindling oil rzv~ and growing militancy among many of the world's younger Muslim population could threaten the economic and political stabilitiy of every nation on Earth. Political leaders and policy analysists are particularly worried about the ... possibility that, in the future, Islamic fundamentalists might pressure their governments to use oil as  weapon against the United States and other Western nationals for supporting the Israelis. || Second, if global oil and natural-gas production peaks, catching the world unprepared, countries and energy companies are likely to look to the dirtier fossil fuels -- coal, heavy oil, and tar sand -- as submstitutes. With Earth's temperature already projected to rise by 2.52 to 10.44 F degrees between now and the 22nd century, the switch to dirtier fuels would mean an increase of CO2 emissions, a greater temperature rise than is now being forecast, and even more devastating effects on the Earth's biosphere than have already been envisioned. || Ours is not the first great civilization in history to face an energy [5/6] crisis. Energy has played an important role in the rise and fall of civilizations. [...] || The United States, and every other country, is vulnerable to mounting internal and external threats and disruptions as we move inot the last stages of the oil era. Our vulnerability is even more pronounced because of the highly centralized, hierarchical energy infrastructure, and the accompaning economic infrastructure, that we created to manage a fossil-fuel energy regime. The fossil-fuel era is characterized by a top-down organizational scheme made necessary by the difficulty of harnessing and exploiting hard-to-find forms of energy. The extraordinary costs associated with the processing of coal, oil, and natural gas required vast amounts of investment capital and led to the formation of giant energy enterprises. Currently [2002], ten to twelve mega-companies, both commerical and stateowned, dictate the terms by which energy flows through the whole world. By centralizing power over the Earth's energy resource, the energy companies created the conditions that rewarded economies of scale, and centralization of economic activity in every other industry." Rifkin's solution? World-wide Hydrogen Energy Web [HEW]. Decentralized, abundant, cheap...| See his next publication for more on this =))
*2011:NYC,Palgrave|>Rifkin.Third|_The_Third Industrial Revolution: How Lateral Power is Transforming Energy, the Economy, and the World| ((SMT| mfgR#3 in Rfk sense = "The Third Industrial Revolution is the last of the great Industrial Revolutions and will lay the foundational infrastructure for an emerging collaborative age. The forty-year build-out of the TIR infrastructure will create hundreds of thousands of new businesses and hundreds of millions of new jobs. Its completion will signal the end of a two-hundred-year commercial saga characterized by industrious thinking, entrepreneurial markets, and mass labor workforcs and the beginning of a new era marked by collaborative behaviour, social networks, and boutique professional and technical workforces. In the coming half century [2011-2061], the conventional, centralized business operations of the First and Second Industrial Revolutions will increasingly be subsumed by the distributed business practices of the Third Industrial Revolution; and the traditional, hierarchical organization of eeconomic and political power will give way to lateral power organized nodally across society". Notice how this visionary almost utopian narrative of a coming future is the nearly polar opposite of the SAC interpretation of a "third" industrial revolution [ID] ))


<>Roderick,Jack| a{}n{}o{
}r{
*1997:Fairbanks.AK,Epicenter|>RCD|_Crude Dreams: A Personal History of Oil and Politics in Alaska| ((SMT USA AK))
}s{
Bio
}t{}8{}

 


<>Ross,Michael Lewin| a{}n{x plt.dms Twrl mdn cvc.pbl tkh.xtx}o{
}r{
*2012:P.NJ,PUP|>Ross.Oil|_The_Oil Curse: how petroleum wealth shapes the development of nations| ((E-TXT| Kmb frm Powells| ToC =
ToC = List of Illustrations [ix]| List of Tables [xi]| Preface [xiii] Abbreviations [xvii]| Country Abbreviations [xix]
1   = ch1| The Paradoxical Wealth of Nations
14  = Appendix (pdx) 1.1| A Note on Methods and Measurements
27  = ch2| The Trouble with Oil Revenues
63  = ch3| More Petroleum, Less Democracy
93  = pdx3.1| A Statistical Analysis of Oil and Democracy
111 = ch4| Petroleum Perpetuates Patriarchy
132 = pdx4.1| A Statistical Analysis of Oil and the Status of Women
145 = ch5| Oil-Based Violence
178 = pdx5.1| A Statistical Analysis of Oil and Civil Conflict
189 = ch6| Oil, Economic Growth, and Political Institutions
223 = ch7| Good News and Bad News about Oil
255 = References

[Ross compares what he learned writing this book with what he had concluded earlier=] Things I assumed were true—that petroleum wealth was linked to slow economic growth and weak government institutions—were probably wrong. Other findings held up, although in modified forms. Patterns that I thought I understood, like the relationship between oil and authoritarianism, and oil and civil war, were incomplete. Petroleum seemed to have a stronger and more harmful effect than other kinds of minerals. And I started to appreciate the role of factors I had overlooked—like the impact of petroleum wealth on economic opportunities for women, which had far-reaching consequences for women’s political rights, population growth, and long-term economic growth. Perhaps the biggest surprise was that the resource curse, as we know it today, is a new phenomenon. The oil-rich countries have long been distinctive; yet before 1980, there were relatively few political differences between oil-producing countries and non-oil-producing countries. The upheaval in global energy markets in the 1970s appears to have triggered the resource curse, by producing a drastic increase in the volume and volatility of government revenues in the oil-producing states. [xiii-xiv]

Since 1980, the developing world has become wealthier, more democratic, and more peaceful. Yet this is only true for countries without oil. The oil states -— scattered across the Middle East, Africa, Latin America, and Asia -— are no wealthier, or more democratic or peaceful, than they were three decades ago. Some are worse off. From 1980 to 2006, per capita incomes fell 6 percent in Venezuela, 45 percent in Gabon, and 85 percent in Iraq. Many oil producers -- like [ALG AGO CLM NGR SDN IRQ] Algeria, Angola, Colombia, Nigeria, Sudan, and again, Iraq -- have been scarred by decades of civil war. These political and economic ailments constitute what is called the resource curse. It is more accurately a mineral curse, since these maladies are not caused by other kinds of natural resources, like forests, fresh water, or fertile cropland. Among minerals, petroleum -- which accounts for more than 90 percent of the world’s minerals trade -- produces the largest problems for the greatest number of countries. The resource curse is overwhelmingly an oil curse. [Ross.Oil:1]

According to modernization theory -- the prevailing view in the 1950s and 1960s of political development, later revived in the 1990s and 2000s -- increases in a country’s income per capita would lead to improvements in virtually every dimension of its political well-being, including the effectiveness of its government, the government’s accountability to its people, and the enfranchisement of women. In the 1950s, 1960s, and 1970s, the conventional wisdom was more or less correct. But in the 1970s, something went wrong in the oil states. [Ross.Oil:2]

The goals of this book are to explain why oil is typically a curse, why some countries have escaped the curse, and how more countries can turn their natural resource wealth from a curse to a blessing. [Ross.Oil:4]

Chapter 3 indicates that oil income is tied to authoritarianism through two pathways: by causing a high ratio of government spending to perceived government revenues, and by leading to greater government secrecy, including a lack of budget transparency and restrictions on the media. [Ross.Oil:105]

Since the oil nationalizations of the 1970s, oil-producing countries have had less democracy, fewer opportunities for women, more frequent civil wars, and more volatile economic growth than the rest of the world, especially in the developing world. But geology is not destiny. Oil has become a curse because the revenues that it generates for governments are abnormally large, do not come from taxing citizens, fluctuate unpredictably, and are easy to conceal from public scrutiny. Most of these qualities can be changed—by citizens, governments, international institutions, and even consumers in oil-importing countries. The consequences of petroleum wealth are different today than they were in the past, and they can change again in the future—perhaps for the better. [Ross.Oil:253, final paragraph]
))
}s{
UCLA ID
}t{}8{}

 

<>Rusco,Frant|>Rusco.Coal|_Coal combustion residue [electronic resource]: Status of EPA's efforts to regulate disposal| ((E-TXT| ecx nrg.c))


<>Russian Federation|>Ministry of Fuel and Energy,International Fuel and Power Association,International Energy Agency| a{}
*1992:PRS [WDC:OECD Publications and Information Centre,distributor] |_International Energy Conference on Natural Resource Management--Crude Oil Sector: Proceedings, Moscow,23-25 November 1992| ((418p nrg.pc))


<>Sakwa,Richard| a{}n{x plt.dms RUS}o{}
*2009:O,OUP|_The_Quality of Freedom: Khodorkovsky, Putin and the Yukos Affair| ((>Sakwa.Quality|

Sakwa.Quality ToC=
Acknowledgements
Preface
1. Introduction: freedom and property| ch1:1-29=Sets out main issues
2. The birth and transformation of Yukos
3. The state and the oligarchs| ch3:74-107=From "equidistance" to "statism"
4. Why Yukos?| What was essence of Putin-Khodorkovskii conflict? [108-112]
5. The assault against Yukos
6. Khodorkovsky goes to jail|| ??ch#?? lwx & stt.power [262-3]
7. There will be blood
8. From oligarch to 'dissident'
9. Propaganda and public opinion
10. Political and moral economy| Meaning of Yukos affair [332-4, 344-56]
11. Polity and power| ch11:357-79, with final sentence, "As in the Soviet period, economic modernization without political modernity was an unstable construct"
12. Conclusion: a question of interpretation? [380-96]
Bibliography
Index
}s{
}t{}8{}


<>Sampson,Anthony| a{1926au03}e{2004de18}n{x}o{
}r{
*:|_The_Sovereign State of ITT| ((OWN ndr crp as stt.ndp CPT ekn.tUt| ch#13:294-313. "The Sovereign State". expands on quote from 1972 Jean-Jacques Servan-Schreiber [ID] = "The multinational corporation [tntn.crp] will be disruptive if a political power does not develop ot put the economy at the service of man, and not put man at its service"))

*1975:NYC,Viking|>Sampson.Seven|_The_Seven Sisters: The Great Oil Companies and the World They Shaped|| ((The *1976:Bantam pb ed. has different pagination| 7ss| Kaufman.Oil quotes on stt&crp

The failure of the Western governments to keep track of the companies and control them has marked their history since RkfJD. [stt.cxx vs-fdu] It was never clear who was using who. As the business became more global in the 'forties and 'fifties, so governments thought they were using their companies by encouraging them abroad, with antitrust clearances, tax advantages and diplomatic support, while the companies were in fact far better at using them in ways that were often against their government's interest

))


*1988 second edition?
*1977:N.NY|_The_Arms Bazaar: From Lebanon to Lockheed| ((OWN ndr mlt.mfg CIV))
*1982:N.NY|_The_Money Lenders: Bankers and a World in Turmoil| ((OWN ndr ekn mfg bnk CIV))
}s{
*--Wki
}t{}8{}


<>Sil,Rudra| a{1967}n{ mdnization wrl.hst G/1880s:JPN }o{
}m{
ID#1
}r{
ID#2
*2002:A.MI,UMP|_Managing "Modernity": Work, Community, and Authority in Late Industrializing Japan and Russia| ((JPN/RUS ~~hst wrk prl pbl gvt stt| sparce JPN & RUS lng sources| "Comparisons and Implications" ch#5:277-85| trx discussion of mdn:xi-xvi, 1-53, 287-321 ))
*2010:|_Beyond Paradigms....| ((hst.gph trx irx "analytic eclecticism))
}s{
}t{}8{}


<>Solberg,Carl| a{1915}n{}o{}
*1976:N.NY,Mason/Charter|>Solberg.Oil|_Oil Power: The Rise and Imminent Fall of an American Empire| ((

Kaufman quotes = Solberg's critical view of the oil depletion allowance and tidelands question in Congress in the 1940s and 1950s|| By 1950 "cooperation between government and big oil had grown so close that the industry operated in every sense as an insider."| "Texas oil millionaires buzzed around General Eisenhower" during the 1952 campaign|| "The new administration's ties with members of the oil industry were soon disclosed. Less than a week after taking office [G/1953ja:/] it moved to kill a Justice Department criminal vs-fdu suit against the seven majors for controlling Middle East output." [AfroAsia] [Solberg.Oil:174] || "...the stt.dpt works hand in glove with the big oil interests. Sixty years after his grandfather monopolized the business, a Rockefeller is vice-president of the United States." [Solberg.Oil:8]
))

*1979:S.CA,SUP|_Oil and Nationalism in Argentina| ((??SAME SOLBERG?? "Carl E."= [ID] ))


<>Stearns,Peter| a{}n{}o{}
*2007:B.CO,Westview|>SmfgR3|>SmfgR4|_The_Industrial Revolution in World History| ed#3| *2013:ed#4| ((mfgR wrl.hst))


<>Stegner,Wallace| *1971:Beirut, Middle East Export Press,Inc|_Discovery! The Search for Arabian Oil| ((nxd AfroAsia))


<>Tanzer,Michael| a{}n{x}o{}
*1969:B.MA,Beacon|_The_political economy of international oil and the underdeveloped countries| ((>Tanzer.Political| 435p nrg.p plt.ekn irx.ekn Twrl| Internet Archive digitized edition of abv = E-TXT ))
*1974:NYC,Monthly Review Pr|_The_Energy Crisis : World Struggle for Power and Wealth| ((>Tanzer.Energy|ndx| nrg.p irx.plt))


<>Tarbell,Ida| a{}n{}o{
*1905jy:1906|McClure’s Magazine| “John D. Rockefeller: A Character Study” [E-TXT#1(both parts) | E-TXT#2(pt1 only)
*1905:|_The_History of Standard Oil|>TStd|[E-TXT]

((F/Cleveland Conquest/ [ID]
F/crushings/
F/sweatings/
F/syphon codes/
F/drawbacks/ & F/rebates/ [ID]))
}s{
Allegheny College website
Wki
}t{}8{}

 

<>Tolf,Robert W| n{ RUS BrN}o{}
*1976:S.CA,SUP|_The_Russian Rockefellers: The Saga of the Nobel Family and the Russian Oil Industry|>Tolf.Nob.crp|


<>Turner,Louis| a{}n{x plt.irx}o{
}r{
*1973:NYC,|_Multinational Companies and the Third World| ((OWN| Twrl tntn.crp|
nrg.p=
3-9
31-40
76-80
91-96
256-60
))
*1983:LND,Allen&Unwin|>Turner.Oil|_Oil Companies in the International System| ed#3| ((CF=8x11))
*:|_Politics And The Multi National Company| ((noUO))
*--More in Janus
}s{}t{}8{}

 

<>United States.... G/Institutions/

 

<>Urquhart,Alvin| a{}n{ecx EEE }o{
}m{
Ex-Director of the University of Oregon Environmental Studies Program
Emeritus Professor of geography
}r{
*2013:,Eco-Justice Press|_Nature and Culture — A Personal Crisis|
*2013au20:ERG| "Transition to sustainability hard but essential"| [TXT]

<>Venturi,Jesse| *2014my07:YouTube assault on Koch brothers

<>Weaver,Bobby| a{}n{prl}o{
}r{
*:|_OILFIELD TRASH: LIFE AND LABOR IN THE OIL PATCH| ((noUO| Synoposis =

When the first gusher blew in at Spindletop, near Beaumont, Texas, in 1901, petroleum began to supplant cotton and cattle as the economic engine of the state and region. Very soon, much of the workforce migrated from the cotton field to the oilfield, following the lure of the wealth being created by black gold. || The early decades of the twentieth century witnessed the development of an oilfield culture, as these workers defined and solidified their position within the region's social fabric. Over time, the work force grew more professionalized, and technological change attracted a different type of laborer. || Bobby D. Weaver grew up and worked in the oil patch. Now, drawing on oral histories supplemented and confirmed by other research, he tells the colorful stories of the workers who actually brought oil wealth to Texas. Drillers, shooters, toolies, pipeliners, teamsters, roustabouts, tank builders, roughnecks . . . each of them played a role in the frenzied, hard-driving lifestyle of the boomtowns that sprouted overnight in association with each major oil discovery. || Weaver tracks the differences between company workers and contract workers. He details the work itself and the ethos that surrounds it. He highlights the similarities and differences from one field to another and traces changing aspects of the work over time. Above all, _Oilfield Trash _captures the unique voices of the laboring people who worked long, hard hours, often risking life and limb to keep the drilling rigs "turning to the right." || BOBBY D. WEAVER earned his PhD in history from Texas Tech University. From 1979 to 2002 he was a museum professional, serving variously as curator, archivist, and assistant director. Prior to that he worked for more than twenty years in the oilfield and petrochemical industries. Weaver is also the author of the award-winning _Castro's Colony_, published in 1985 by Texas AandM University Press. || WHAT READERS ARE SAYING: "Given the hundreds of thousands of persons who worked in the upstream sector of the American petroleum industry (1901-1960), it is remarkable and lamentable that to this point there has been relatively little written on the history of oilfield labor in general, let alone in Texas. For that reason, Weaver's study of oilfield labor during the first half centry of Texas is indeed welcome . . . will make a substantial contribution to both labor history and the history of the American petroleum industry."--Diana Hinton, J. Conrad Dunagan Chair in Regional and Business History, University of Texas of the Permian Basin
))

*:|OK.state digital.library| "Oil Field Culture"
}s{}t{}8{}


 

<>Wilkins,Mira| a{}n{x tntn.crp plt.irx}o{}
*1970:C.MA,HUP|>Wilkins.tntn1|_The_Emergence of Multinational Enterprise: American Business Abroad from Colonial Era to 1914| (())
*1974:C.MA,HUP|>Wilkins.tntn2|_The_Maturing of Multinational Enterprise: American Business Abroad from 1914 to 1970| (())

 

 

<>Williamson,Harold F, and >Daum,AR| a{}n{}o{}
*1959-1963:E.IL,NUP|_The_American Petroleum Industry| v1= Age of Illumination, 1859-1889|>W&D,1 (( R&A:509ff and 630ff| ndx has no "Government" or "Politics", but G/1878ap/| Also NB! "Legislation, regulatory" |>rgl.lwx| 8 sig. discussions, esp=316-18 405-412 431-37 558-62 702-22| & NB! "Litigation" |>lwx.sud 405-12 558-62 602-4))
*1963:E.IL,NUP    |_The_American Petroleum Industry| v2= Age of Energy, 1899-1959|>W&D,2| (())

*1961au:JPE#69[LXIX]: 381-85|>Williamson,Harold F and >Andreano,Ralph Louis| "Integration and Competition in the Oil Industry: A Review Article"| ((Kaufman.Oil associates point of view here w/Hartshorn.Politics))

NB! = *1916:Same title & also 2vv, pst=>Bacon,Raymond Foss and >Hamor,William Allen

 


<>Yergin,Daniel|>YrgD| a{}n{x}o{
}r{
*1977:B.MA|_Shattered Peace: The Origins of the Cold War and the National Security State| ((>YSP| USA5.CWX mlt))
*1991:NYC|_The_Prize: Epic Quest for Oil, Money and Power| ((|>Yergin.Prize| OWN| VIDEO))
*2011:NYC|_The_Quest: Energy, Security and the Remaking of the Modern World| ((>Yergin.Quest| Brd frm Powells))
}s{
Wki
}t{}8{}


<>Yizraeli,Sarah|_Politics and Society in Saudi Arabia: The Crucial Years of Development, 1960-1982| *2012:N.NY,CUP| ((Aramco in 1970s [37f] SaA debates on "ekn.development"[120f] SaA 5yp~ [ID][142f] ))

 

<>Zartman,William, ed| a{}
*1976:GC.NY,Anchor|_The_50% solution: How to bargain successfully with hijackers, strikers ,bosses, oil magnates, Arabs ,Russians, and other worthy opponents in this modern world| ((|549p nrg.p))

 

<>Zaslavsky,Victor| a{}
*1982:|_Neo-Stalinist State: Class,Ethnicity, and Consensus in Soviet Society|Armonk NY:M.E. Sharpe,?|
*1993su:Telos#96:26-52| “Russia and the Problem of Democratic Transition”| ((NWO YlcB|RUS attitudes -lwx different from “nsx of a zpd country”:RUS distrust them and think they serve interest of powers [28!? different]|Z presents plt struggle as rfm vs-defenders of old order [28] 93sp:”old order” provoked crisis,hoping to cause cvl.wrx|YlcB “belatedly” and in response to attack frm “hard-liners” [45] dissoved Ncng [29] Links Rts and Xbl w/fools coup [29] YlcB “remained the country’s undisputed leader,despite the uncstionality of his dkr” [30] Ncng attracted “eerie coalition of raving nationalists,neo-Bolsheviks,fundamentalists,paranoiacs and thugs--Russia’s lunatic fringe,known locally as the redbrown crowd”[30here Z cites Remnick in Int.HerTrib] On one p.[31] claims Gaidar successful w/mkt.rfm and expresses confidence in zpd help,such as monitoring developments “by independent international organizations”[37] BUT quotes 93ja28:Dolgolaptev|rtl settles down to less sweeping and more focussed discussion of ekn foundations of recent events [33f] MIC a drag (5000 cmp~ in MIC,only 12 bcm cvl) [33] BUT NB!?,MIC “suffered the highest decline following the disintegration of the Soviet Union [39] MIC has collapsed [40] Good on prv EG=in grn and nrg.p [34-7] and small plots fxx lnd for grd nsx|But “inertia of state-dependency continues to hound Russian society [37] esp. “state-dependent” ntg [41-2quotes Gudkov] Good on gbx revanche,quotes 93my14:MNe [PRL ntn=] Z’s initial enthusiasm for YlcB all but evaporates as rtl hits 2/3 point:dangers of prx model of cst “total lack of the parliamentary tradition” [44!?] ntn unrest,etc,but YlcB prx-ism perhaps still best:elx and creation of pty~ sufficient C&B [45 No mention of KST] YlcB cst squelched “ethno-territorial power-sharing arrangements” (no reference to stt.ndp of ethno-territorial (ntn-ggr) rgn~ and rpx~;double ctzip expunged)|Z feels ntn revival “extremely dangerous”|Odd opening of conclusion which contrasts RUS w/other x-SSR rpx~:”in Russia representative dmky appears to have won its first battles” in form of pcxul trans frm parliament to prxno “iron hand rule” [46;cites Berard and Telos,84 debate,and thus invokes Kliamkin-Popov,G contrast] Shifts to citations frm Di Palma,To Craft:3-8|Lists RUS resources for dmk which might be like Gerschenkron,ekn.Backw called “specific substitutions” for typical zpd elements of mfgR =

  1. natural resources(esp.grn-nrg.p)
  2. clx2 weak,but universal grm and ntg (cites Drucker,Post-C)
  3. mxx and zpd.clt popular w/chd
  4. even sttist tradition cld help ekn development [50]
  5. 0-nsx growth
  6. gbx.gvt (almost seems to mean clv.pbl as in citation of Bystritskii,Kholod)
  7. zpd assistance and interest

Ill-tempered but useful reply by Gabor Rittersporn(53-60):YlcB didn’t really “win” referendum by wide margin;other interpretations closer to reality|which zpd values? What of IND or Peru|Why support prx vs-Ncng? cst of YlcB not so hot [cites Lefitinskii”Dva]
))

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