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New Global Disclosure Release Reveals Potential For Cooperative Energy Development in Siberia
Raymond J. Albright, "Siberian Energy for Japan and the United States," 1972-73 Senior Seminar in Foreign Policy, US State Department, Washington DC.

This case study is taken from a series produced for the US State Department's Senior Seminar in Foreign Policy released to the Nautilus Institute under the US Freedom of Information Act. Other papers from this series will be released shortly.

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Raymond Albright wrote this case study during the first energy crisis in the 1970s. Albright analyzed possible conflict and cooperation between the United States and Japan to obtain access to energy sources in then Soviet Siberia. Three decades later, discussion continues about developing Siberian energy resources by gas pipelines, LNG lines, or grid interconnection projects. These efforts have the potential to foster regional cooperation in East Asia as well as be an important source of energy to nations like the United States and Japan, which will import a massive amount of their energy supply from abroad, or new energy markets like the People's Republic of China. Albright's case study examines collaborative development and exploration projects between nations, the difficulties that must be overcome on the part of companies and governments to make these projects successful, and their benefit to the participating countries involved in the partnership. Many of his lessons-learned remain salient today and explain the slow pace of Siberian energy export.

Says Albright:

"Japan's overall foreign policy stance of non-militarism can be partly attributed to an effort to avoid antagonizing potential sources of natural resources, particularly energy. Minimum friction in international relations with energy suppliers has also characterized its approach to OPEC." [4]

"Japan also appears to have stability in energy supply in mind as it develops its technical and financial assistance programs. It is interesting to note that major participation of Japanese firms in the economic development of Iran, the country from which Japan imports about one-half of its petroleum. Some circles in Japan are also considering a possible economic cooperation agreement between Japan and OPEC (or some OPEC members), to assure regular flow of crude in return for Japanese capital and technology." [5]

"US companies have the most advanced technology related to oil and gas exploration, extraction and marketing. The large costs associated with the emerging new sources of energy suggest the value of spreading capital sources and sharing risks. In politically unstable areas, or in areas sensitive to potential Japanese political domination, it could be very useful for Japanese to have a partner … as a further deterrent to price or supply leverage by the host country." [7]

"…economic negotiations were not directly conditional on a political settlement …. The approach seemed to be that economic cooperation now could improve the climate for later political solutions." [15]

"It is in the US interest to see that Japanese policies toward Moscow and Peking run on parallel tracks with our own. The US is seeking an economic world environment based on international cooperation in trade and monetary affairs, and would be concerned about energy resource competition running in a contrary direction. Thus, it appears in the US interest to take initiative with Japan to build a coordinated policy approach on energy resources abroad, rather than to allow incipient tendencies toward competitive nationalism to expand." [37]

"The need now is for both countries to move from espousing cooperation, as a general principle, to concrete actions. The economic benefits are compelling. By avoiding competition for foreign supply sources, prices for both will be less. Cooperation would also permit specialization in technology of new energy resources, and LNG facilities, pipe, tankers and other equipment which will avoid national duplication and enhance sharing of export markets …. They [the Japanese] have a preference for international cooperation, particularly with the US, but they will not sustain this posture if the US does not reciprocate." [39]

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