FT: FRENCH AND TURKISH ELECTIONS STALL NABUCCO PIPELINE PLANS

The New Anatolian, Turkey
April 10 2007

The Financial Times reported yesterday that plans to build the
$6.2bn Nabucco pipeline to transport Caspian gas to western Europe
have almost ground to a halt after becoming embroiled in electoral
politics in France and Turkey.

The Nabucco pipeline will transport gas from Central Asia, through
Turkey, Bulgaria, Romania and Hungary to Austria. Start of the pipeline
construction is scheduled for 2008. The first gas shipments have to
be made by 2012. The planned pipeline would reduce Europe’s dependency
on Russian gas.

The Times recalled that Turkey has refused to approve extending the
construction project to include Gaz de France, the French utility.

"The move, which officials said might be revised after the French
presidential elections in May, reflects simmering anger in Ankara
over France’s support for Armenia’s claim of genocide by Ottoman
Turks during the first world war," the daily said.

Turkey strongly opposes the claims that its predecessor state, the
Ottoman government, caused the Armenian deaths in a planned genocide.

The Turkish government has said the toll is wildly inflated and that
Armenians were killed or displaced in civil unrest during the empire’s
collapse and conditions of World War I. Ankara’s proposal to Yerevan to
set up a joint commission of historians to study the disputed events
is still awaiting a positive response from the Armenian side. After
French lawmakers voted last October to make it a crime to deny that the
claims were genocide, Turkey said it would suspend military relations
with France.

"A threatened boycott of French goods in Turkey after the French
parliament voted last year to make denial of the genocide claim a
crime has not had much success. But the Turkish government warned at
the time that it might exclude French companies from contracts. The
face-off with GdF may be a result of that, some diplomats in Ankara
said yesterday," the daily said

"The dispute over the participation of GdF, the favourite to join
the consortium building Nabucco, could complicate matters further",
the daily said. "Industry observers said the negotiations with a
new investor had taken longer than expected, with some blaming the
strained relations between Ankara and Paris."

Recalling that Turkey is holding a general election later this year,
the daily added the Armenian issue has exploded onto the political
agenda. But, the daily quoted some analysts saying "the stand-off
between Turkey and GdF could have as much to do with negotiating
tactics as with politics."

"The Nabucco project is an opportunity for Turkey to unload its excess
supply," the daily quoted Bulgarian analyses. "But if talks with a
French buyer aren’t going well, it doesn’t cost anything to bring up
the Armenian issue."