Industry and Energy

Industry and Energy

Richard Morningstar: US Administration deeply supports opening a new corridor to bring natural gas from the Caspian region to Europe - EXCLUSIVE

Richard Morningstar: US Administration deeply supports opening a new corridor to bring natural gas from the Caspian region to Europe - <font color=red>EXCLUSIVE</font>

29 January 2010 11:20 (UTC +04:00)

Vashington. Isabel Levin - APA. US Special Envoy for Eurasian Energy Richard Morningstar, who recently returned from his trip to Azerbaijan and Georgia, spoke out about Obama Administration Energy Diplomacy in Eurasia, including South Caucasus at the Center for American Progress in Washington DC, on January 28th.
According to APAâ€™s Washington correspondent Mr. Morningstar characterized Administrationâ€™s approach to Eurasian Energy issues and the outlook for 2010 and beyond.
â€œ2009 turned out to be a turbulent year in many respects and that characterization aptly describes world energy markets. With the financial and economic crisis, global energy use declined, prices fell and an oversupply of natural gas on the world market materialized. This situation is creating some risk in the market. Cheaper gas prices could slow the development of clean technologies â€“ like wind, solar, geothermal â€“ and could dampen our resolve to seriously pursue energy efficiency. We canâ€™t let this happenâ€- US Special Envoy said.

According to him, depressed prices and revenue streams have led oil and gas companies to delay projects and investments that would bring more production on line.

â€œDepending on the rate of future economic growth and the length of these delays, energy markets could again swing in the other direction toward energy shortfalls and high prices. We need to be aware that decisions we make today will have long-term consequences for future markets. We need to find ways to moderate the boom and bust of energy marketsâ€.

Speaking about the future, Ambassador Morningstar stressed that, â€œwe know the economy will get back on its feet but it is not easy to predict the rate of growth and the time period for recovery. Still, we can identify a couple of key trendsâ€.

Washington believes that, the global market for natural gas is undergoing significant change and the US is a significant factor in this process.

According to the ambassador Morningstar, â€œall existing and future markets changes will inevitably influence how US implement its Eurasian Energy strategy, but they will not change our fundamental goalsâ€.

â€œThere are three main components to our Eurasian energy strategy. First, we want to encourage the development of new oil and gas resources, while also promoting efficiency and conservation in the use of all energy resources, as well as alternative technologiesâ€.

After that the Ambassador Morningstar spoke about Azerbaijan:

â€œWhen we are talking about new natural gas production in Azerbaijan, it is unlikely that one molecule of that gas will reach the U.S., but it is still important because it would add to international gas supply, increasing global energy security. New supply in one place naturally frees up supply in anotherâ€, - he said.

Morningstar stressed that, Washington wants to support Europe in its quest for energy security. Looking at goods and services together, the EU and the US account for the largest bilateral trade and investment relationship in the world.

He also said that Washington believes Turkey and Azerbaijan will figure out their dispute over the gas prices. The significant amount of bilateral trade and investment illustrates the high degree of interdependence of the two economies.
â€œWe have an interest in maintaining this level of commercial and economic activity with Europe. Europe is our partner on any number of global issues. We have an interest in an economically strong and energy secure Europeâ€, he said.

US special envoy also added that, Europe is composed of many different states and energy security is a more pressing issue to some than to others. Some countries in Europe do not have a diverse energy mix and depend to a great degree on one supplier and one transport route.

â€œWe also want to help Caucasus and Central Asian producer countries find new routes to market for their oil and gas. We want to help foster economic growth and prosperity in these countries. By increasing production and expanding export routes, they can increase competition for their resources and demand a higher priceâ€, - Ambassador added.

He announced that US Administration deeply supports opening a new corridor, a Southern Corridor, to bring natural gas from the Caspian region to Europe. This corridor could include Nabucco and the Turkey-Greece-Italy Interconnector.

â€œBoth are important from a strategic standpoint to diversify gas sources and open new supply routes to Europe. A Southern Corridor would provide commercial benefit for the countries of the Caucasus and Central Asia and also create a long-term partnership based on mutual interests with Europeâ€.