OIL and POLITICS
The Wall Street Journal -- April 22, 1998
Politics & Policy:
Gore Gets a Mouthful of
Foreign-Policy Expertise
With Turkmenistan, Kazakstan
and Azerbaijan
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By Laurie Lande
Staff Reporter of The Wall Street Journal
WASHINGTON -- As he supports President Clinton's agenda and
pursues his own, Vice President Al Gore is expected to woo labor unions,
minority voters and high-tech executives. But today he's courting an unlikely
constituency: the central Asian republic of Turkmenistan.
Mr. Gore will be front and center when Turkmen President Saparmurat
Niyazov signs oil-development contracts with big U.S. energy companies
and later receives a $750,000 U.S. government grant to explore the
feasibility of an oil-shipment pipeline underneath the Caspian Sea. It has
become familiar territory for the vice president, who in recent months has
overseen approximately $18 billion in oil deals during visits by the leaders of
Turkmenistan's Caspian region neighbors Kazakstan and Azerbaijan.
As obscure as these countries are to most Americans, their immense oil
reserves and strategic importance make them objects of intense interest
from U.S. energy companies and government policy makers alike. That
gives Mr. Gore plenty of economic and national-security reasons to focus
on relations with the former Soviet republics. At the same time, the effort
could also yield long-term political dividends as the vice president points
toward his own bid to succeed Mr. Clinton in 2000.
For one thing, events such as this afternoon's scheduled contract signing at
Blair House burnish Mr. Gore's foreign-policy resume. "The experience
allows Gore to bring to the table a set of skills no presidential candidate
usually has," says William White, a former Clinton administration Energy
Department official who now heads the Texas Democratic Party. Boosting
business interests in the region also helps to solidify Mr. Gore's "New
Democrat" credentials and reinforces his strong relations with America's
politically active pro-Israel community, which wants Caspian energy
reserves developed to counter the influence of Middle East sources.
Cultivating relations with his counterparts abroad is a major part of Mr.
Gore's diplomatic portfolio. Best known are his twice-yearly meetings with
Russian Prime Minister Viktor Chernomyrdin, though their future was
thrown in doubt when Russian President Boris Yeltsin summarily fired Mr.
Chernomyrdin and other cabinet members last month. Mr. Gore has
nurtured similar ties in South Africa and Egypt.
But he has also, with much less public notice, invested lots of time with
former Soviet republics that most Americans have never heard of. His
outreach efforts include such arcane sounding entities as the
U.S.-Kazakstan Joint Commission, the U.S.-Ukraine Binational
Commission and a similar bilateral venture with Uzbekistan.
It's not hard to understand why. The Energy Department estimates that the
Caspian region's oil fields, still mostly untapped, could contain reserves of
up to 200 billion barrels, second in the world only to the Persian Gulf.
Adding to their strategic significance, central Asian republics offer the
possibility of an oil-transmission route that could bypass Iran, a leading U.S.
adversary in the Middle East.
"The commissions haven't been highly publicized, but they are an important
source of stability in our relationships with these countries," says Tony
Lake, Mr. Clinton's former national security adviser. He adds that they also
make Mr. Gore "familiar with the business issues" in the region, which
include encouraging former Soviet republics to adopt business-friendly legal
practices such as protection for foreign investment and fair
production-sharing agreements for U.S. oil producers.
Central Asian reserves are especially crucial to major American oil
companies, because U.S. policy bars them from doing business in such
energy-rich countries as Iran, Iraq and Libya. Consider the roster of firms
planning to link up with Turkmenistan's Mr. Niyazov during this week's visit:
Mobil Corp., which plans to sign a multimillion-dollar deal to develop
offshore reserves; Exxon Corp., which hopes to complete an exploration
agreement as well; Halliburton Co., which wants to sell the Turkmens
drilling equipment; and Western Atlas Inc., which wants to conduct oiland
gas-survey work.
The vice president's involvement "gives Gore credibility with these foreign
leaders, who control a sizable new source of oil supplies for the world,"
says Julia Nanay, a consultant specializing in the former Soviet Union at
Petroleum Finance Co. in Washington. In the process, she adds, Mr.
Gore's friendly exposure to U.S. oil companies could be a boon to his
future campaign fund-raising. Since 1995 alone, according to figures
compiled by the Center for Responsive Politics, oil companies, their
political-action committees, and their executives have given about $28
million to federal candidates and the major political parties.
Aides to Mr. Gore minimize those potential benefits. "No one can
pronounce or spell those countries," quips Ronald Klain, the vice
president's chief of staff. "The political payoff, for the amount of time he's
spent on this issue, is small. It's part of his job."
At the same time, the administration's involvement with the former Soviet
republics and their oil riches carries risks as well as rewards. Sen. Sam
Brownback, who heads a foreign-relations subcommittee on Near East
affairs, complains that the administration has slighted human-rights concerns,
such as religious freedom, in the Caspian region. "We are seen as just being
interested in their oil," says the Kansas Republican, who just returned from
a visit to the region last week.
Meanwhile, a federal grand jury has been investigating whether White
House officials improperly assisted oil financier Roger Tamraz, who
donated $177,000 to the Democratic Party during the 1996 campaign
while trying to build support for his own proposed pipeline under the
Caspian Sea. Mr. Tamraz attended some White House events with Mr.
Clinton around the time of the donations, though he was blocked from one
meeting with the vice president after a key Gore adviser cautioned against
it.
Sen. Brownback, for his part, says Mr. Gore and other top administration
aides should pay more attention to the region, not less. So far, experts
credit the vice president with at least having encouraged the transition
toward a market economy in the former Soviet republics. "Gore's really
done a good job at changing the investment climate," says Laurent
Ruseckas, associate director of Caspian research at Cambridge Energy
Research Associates. "It can't hurt him politically."
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