Aliyev Hints at New Oil contracts in Talks at UN

UNITED NATIONS (Reuter)–Azeri President Gaidar Aliyev said Monday he might sign several oil contracts when he visits Washington this week.

Answering questions at a news conference at the United Nations–he gave no details but said Azerbaijan had signed six major oil contracts with multinational oil companies up to now.

"The companies are from the United States of America–from the United Kingdom–from France," he said–speaking through an interpreter.

"And also (companies) from Germany–Italy–Belgium–Turkey–Iran–Saudi Arabia and Japan are participating in the development of Azerbaijan’s oil resources," he added.

"These contracts are being practically implemented," Aliyev said.

"We have also worked out several contracts. Maybe we will sign them during my visit to Washington. Wait two more days and you will get to know which contracts are they," he added.

Before Aliyev left Baku for the United States–Azeri officials said he would sign three contracts worth $10 billion with the US oil giants Exxon–Chevron and Mobil to develop three new offshore Caspian Sea fields.

In advance of Aliyev’s visit–the Clinton administration has been working to remove a major irritant in US-Azeri relations–according to Voice of America.

At the heart of the matter is a 1992 law–The Freedom Support Act–governing US aid to countries of the former Soviet Union. One part of that law–section 907–was adopted in response to Azerbaijan’s blockade of the Armenian Republic and of Nagorno-Karabakh–the largely Armenian region that is within Azerbaijan but seeks independence from it.

The section specifies that no US assistance may be provided directly to the government of Azerbaijan until that government takes demonstrable steps to cease the blockade and other uses of force against the people of Armenia and Nagorno-Karabakh.

Congress adopted section 907 by an overwhelming vote after an intensive lobbying effort by Washington-based Armenian organizations.

Jayhun Molla-Zade–President of the US/Azerbaijan council here–suggests the congressmen were given a one-sided picture.

"There was little knowledge about the conflict. There was no Azeri presence in this town. There was no embassy–there was no Azeri organization involved in educating people on the essence of the conflict," said Molla-Zade.

Azeri spokesman’see section 907 as unfair–especially now that a cease-fire has been in effect for three years–and 20% of Azerbaijan’s territory remains under Armenian occupation.

The Clinton administration–like the Bush administration before it–has always opposed section 907. In an address last Monday–Deputy Secretary of State–Strobe Talbott spelled out why.

"This legislation was intended to help Armenia overcome an Azerbaijan embargo. But it has had the negative effect of limiting our leverage with Baku and complicating our ability to be as effective as we could otherwise be as an honest broker. It has also made it impossible for us to provide the Azerbaijanis with assistance on elections–economic reform–energy development and in other areas where it is in our national interest to provide such assistance," said Talbot.

A number of former top officials–Republicans as well as Democrats–have also urged a repeal of the aid ban. Many of these officials have ties as consultants–legal advisors–shareholders–or executives to American oil companies involved in developing Azerbaijan’s vast oil resources in the Caspian Sea.

Spokesman for Armenian organizations here regard this as improper–and warn that the US is in danger of sacrificing principle profit. Aram Hamparian–Executive Director of the Armenian National Committee–charges that President Aliyev is trying to buy influence in the American political system.

"What he has done–what the president of Azerbaijan has done–is to pressure US oil firms into adopting his political agenda. He has pressured them into spending millions of dollars on very high-priced lobbyists–including people like Brent Scowcroft–James Baker–John Sununu–Zbigniew Brezinski–to influence and manipulate US policy on behalf of Azerbaijan’s goals," said Hamparian.

But Eshan Alekberov–Vice President of LPI Consulting–an international energy consulting firm–maintains that these so-called lobbyists are promoting the goals and interests of the US. In his opinion–section 907 does not.

"And when you talk to Azerbaijanis–they all say OK–look at what is happening. Azerbaijan is signing 30-year contracts with major American oil companies. In the meantime–Armenia is signing a 30-year military cooperation agreement with Russia–to base Russian military bases on its soil. Azerbaijan is resisting Islamic fundamentalism–fighting with Iran to preserve its secular state–while Armenia’s best–largest trading partner has become Iran…despite all of this–Azerbaijan is being punished–while Armenia is I think the second-largest per capita recipient of American tax dollars," said Alekberov.

Yet Armenian-American organizations here insist that section 907 must remain in place until Azerbaijan takes steps to end its blockade of Armenia and Nagorno-Karabakh. And they believe they have the votes in Congress to keep it in place.

Even Azeri spokesmen don’t expect a total repeal of section 907–which has been incorporated–with some modifications–into both the House and Senate versions of the foreign aid spending bill for fiscal 1998. In the long run–everyone agrees that the best way to put section 907 to rest is to achieve a final peace settlement in the 10-year-old Nagorno-Karabakh conflict–a task the Clinton administration has made a top priority.


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