THE WHITE HOUSE Office of the Press Secretary
(Istanbul, Turkey)
_______________________________________________
For Immediate Release
November 17, 1999
FACT SHEET

Background on U.S. Caspian Energy Policy Caspian energy policy: 

The Clinton Administration has actively supported the development of oil and gas resources of the Caspian Basin since 1994, when the U.S. Government established a special inter-agency working group to focus on the President's Caspian energy policy. This working group ensures incorporation of commercial, technical, diplomatic, and other perspectives in forming U.S. policy on Caspian energy development.

Starting in 1995, the United States has specifically advocated the establishment of multiple energy export pipelines, traveling along an "east-west" axis from the Caspian region. This policy is intended to:

- underscore our commitment to the sovereignty and independence of the new states of the Caspian region and enhance their economic prospects;

- improve the energy security of the U.S., Turkey, and other allies by ensuring the free flow of Caspian energy to the world market, without interference from Iran or dependence on any single route;

- enhance commercial opportunities for U.S. and other companies;

- create incentives to resolve regional conflicts by re-establishing economic linkages among the new Caspian states; and

- promote and protect the environmental safety of the Bosporus Strait.

Milestones: 

The Clinton Administration's multiple pipelines policy has achieved the following milestones:

- In 1995, international energy companies decided to build two "early oil" pipelines from Azerbaijan, a northern line to Novorossisysk in Russia and a western line to Supsa, on the Black Sea coast of Georgia. The western line opened in April 1999 and is operating at its capacity of 115,000 barrels per day. The northern line opened in November 1997, with a capacity of 130,000 barrels per day, although it has since been periodically out of service due to the instability in Dagestan and Chechnya.

- In 1996, Vice President Gore reached agreement with Russian Prime Minister Chernomyrdin that broke a longstanding logjam barring construction of the Caspian Pipeline Consortium line, which is to run from northwestern Kazakhstan to the Black Sea port of Novorossisysk across southern Russia. Construction of the CPC line is now underway, and the project is already bringing far-reaching benefits to Russia and Kazakhstan in terms of expanded employment, manufacturing, and governmental revenues. The line will principally serve the Tengizchevroil project and is expected to be operational in 2001.

- In May 1998, the U.S. Trade and Development Agency, the U.S. Export-Import Bank, and the Overseas Private Investment Corporation announce the establishment of the Caspian Finance Center, in Ankara. The Center's mission is to facilitate the development energy and other infrastructure projects in the Caspian region by combining the forces of the U.S. Government's three export credit agencies.

- In July 1998, the President appointed Ambassador Richard Morningstar to the new position of Special Advisor to the President and the Secretary of State for Caspian Basin Energy Diplomacy. In July 1999, Ambassador Morningstar was succeeded by Ambassador John Wolf.

- In October 1998, the Presidents of Turkey, Georgia, Azerbaijan, Kazakhstan, and Uzbekistan signed the Ankara Declaration, in which the countries for the first time formally expressed support for the Baku-Ceyhan main export pipeline and announced the intention to initiate an intensive dialogue with energy producers across the Caspian region.

- In February 1999, the Government of Turkmenistan selected PSG Inc. as the lead sponsor to develop the Trans-Caspian Gas Pipeline. In August 1999, PSG and Royal Dutch Shell concluded a memorandum of understanding in which they formed a partnership to develop the Trans-Caspian Gas Pipeline.