PIPELINE TALKS HALT NOT END OF PROCESS-TURK OFFICIAL (10/04/2007)

Energy.gr, Greece
April 10 2007

Turkey has suspended talks with Gaz de France (GDF) over the proposed
acquisition by the French group of a stake in a major gas pipeline
project, but the decision is not final, a Foreign Ministry official
said Friday.

A press report claimed Thursday the talks had been suspended because
of a political row sparked by French pressure to label Turkish action
against Armenians during World War I as genocide.

"This is not a final decision. We understand that the negotiating
process has not yet come to an end," the diplomat told AFP on the
condition of anonymity.

"This is a commercial issue between companies and they will make the
final decision on the basis of financial considerations," he added.

The five-company Nabucco consortium, involving Turkey’s BOTAS, plans
to build a 3,300-kilometer (2,000-mile) pipeline that will carry
natural gas from the Middle East and Central Asia to the European
Union via Turkey and the Balkans, bypassing Russia.

"Negotiations have been complicated and slowed down by the genocide
issue," confirmed another source close to the case.

The other partners in Nabucco are Austria’s oil and gas group OMV,
Hungary’s MOL, Bulgaria’s Bulgargaz and Romania’s Transgaz.

The consortium is seeking a sixth partner in the 6-billion-dollar
(4.5-billion-euro) project, expected to become operational in 2012.

The other partners reportedly approved GDF’s participation, but BOTAS
has opposed it because of a French draft law on the Armenian massacres.

A bill was adopted by the National Assembly in Paris in October
calling for jail sentences for those who deny that Ottoman Turks
committed genocide against Armenians during World War I.

It must still go before the Senate, then back to the lower house
before becoming law.

Turkey had at the time threatened unspecified measures against the
bill, which followed a 2001 resolution by the French parliament
recognizing the killings as genocide.

In November, the Turkish army froze bilateral military ties with
France over the bill.

Armenians say up to 1.5 million of their kin perished in orchestrated
killings between 1915 and 1917 under the Ottoman Empire.

Turkey categorically rejects the genocide label and says thousands of
Turks and Armenians were killed in civil strife when Armenians took
up arms for independence in eastern Anatolia and sided with Russian
troops invading the crumbling empire.