A/S Pyatt:  Thank you, [Ariel].  It’s wonderful to see so many colleagues here.  I feel a little bit like the prodigal son coming back to a family that I was part of until nine years ago.  It’s wonderful to see so many old colleagues — Lisa, Steve, my predecessor down at [inaudible] Dennis [inaudible], Ariel of course, John, Allen.  I could go on and on.

I want to make a couple of observations.  First, let me note how delighted I am to be here, speaking also with Ambassador [Ashikbayev].  He was the first foreign ambassador I met with once I was sworn into office in this role in September.  I think I’ve probably met with more senior Kazakh officials than any other governance other than maybe Ukraine since I moved back to main State.  And one of the reasons for that, as I said to Deputy Foreign Minister Kairat Umarov just last week, is that there are few countries that bring together all of the issues that I’m responsible for as perfectly as Kazakhstan does.

That is to say Kazakhstan is a key partner in our global energy security agenda, and contributes about one percent of global crude oil at a moment when we use every barrel that we can find that’s not coming from Russia.  It is a country that has extraordinary potential for renewables as Eric alluded to.

I can remember my first time driving from Almaty to Bishkek.  It looks so much like driving in the high plains of Colorado, which by the way is one of our largest renewable states in the US right now.

It is also a country, as was just pointed out by Eric, that has extraordinary resources in terms of critical minerals at a moment when the world needs all the critical mineral supplies it can find.  And it is a country, as the question just pointed out, that has plentiful resources.  First of all, a very important legacy on civil nuclear issues which I know vividly from my time working with Ambassador [Kazykhan] at the IAEA in Vienna.  Of course we worked together to create the IAEA Fuel Bank in Kazakhstan and it is a country that is poised to play an even larger role in the global civil nuclear picture at a moment when we as a G7 are committed to de-risking ourselves from our Russian energy sources, and when the area of greatest scope for further action at this point is how we de-risk ourselves from Russia.

So I’m really delighted to be here.

I’ll make a couple of observations to begin with, coming back to this conversation.

The first is just how satisfying it has been for me to see how even as the sort of core mantra of US policy towards Central Asia, our support for the sovereignty, territorial integrity of the countries remains.  We’ve built up a much richer institutional partnership.  Steve knows this.  We are in a profession where you sort of put your oar in for a couple of years, you row as hard as you can, and you hand it off to the next person and you hope that they keep going.

But it was encouraging for me to see how committed Secretary Blinken is to the C5+1 structure.  The fact that he was back in Kazakhstan just a few weeks ago meeting with all of our partners in the region.  We just had our Turkmenistan ABCs last week with partners [inaudible].  So we are taking this region very, very seriously at a moment when, as Eric pointed out, everything has been changed by Russia’s invasion of Ukraine.  The message that that has sent about Vladimir Putin’s [inaudible] agenda but also the impact that it has had on the Central Asians themselves as they think about their place in the global economy.

Something that has changed as I came back to these issues, of course is China.  I can remember when I was visiting Ashkhabad ten years ago people were just talking about the Chinese investment in pipelines.  Today 75 percent of Turkmenistan’s gas resources go into a pipeline from China.  And that, of course, has significant implications for Turkmenistan’s strategic direction.  And China, of course, is a significant factor across the wider region.

In this context I would commend everybody if you have not seen it, Jake Sullivan’s remarks last week at the Brookings Institute which are a really important articulation of the administration’s approach to de-risking our relationship with China, but also to provide as one would expect of Jake, a fairly candid window into some of the policy things that are going on right now about how we think about our continued engagement with China.  And I was pleased to see in his remarks a very strong focus on the critical minerals issues that we just talked about, that Eric pointed out.

So we have a lot that is going on across the region.  I would flag two big externalities as well.  One is the role of Russia itself, particularly in the Russian oil and gas sector, and I have spent a lot of time in my first year in this role talking to governments around the world about fossil fuel energy security and how to deal with the weaponization of Russia’s oil and gas resources.

The aspect of this conversation that I don’t think has gotten enough attention is what it means for Russia itself.  That a country which gets most of its budget from oil and gas is projected by the IAEA to have its oil and gas revenues down by 50 percent by 2030.  It’s an extraordinary turn of events and it is a reminder that while we’ve all spent year and years talking about European energy security and Europe’s former vulnerability to dependence on Russia, we sometimes overlook the other side of the equation which was Russia’s dependence on Europe as a market which they have now lost and lost forever.  And I say that in part based on a lot of travel to Europe and based on participation three weeks ago with Secretary Blinken in the first session of the US-EU Energy Council since the invasion of Ukraine where it was very clear from our European allies that there’s going to be no return to business as usual, regardless of how the war in Ukraine is eventually settled.

The other element is the climate crisis.  I’ve been impressed talking to counterparts from Central Asia by the reminder that all of them have provided me of how vulnerable Central Asia itself is to the effects of the climate crisis.  This is not an abstraction.  In the SCA world, of course, Pakistan is probably the foremost example of that.  You all saw the terrible flooding last year.  I was back in Islamabad about six weeks ago and had a long session with Prime Minister Sharif.  Steve, you’ll be proud to know that he’s still talking about [TAPI].

These are countries for whom climate change and the climate crisis is not an abstraction.  You see that in the mountainous countries of Central Asia whose access to hydropower is at risk as mountain glaciers are melting, but also the implications that has for agriculture, for cash crops like cotton for food and food security.

So there’s a strong interest that I have found across the region in working with the United States, working with US companies on these issues of climate change and in particular how to address the region’s understandable energy requirements in the most sustainable way possible.

I was particularly impressed, in Istanbul I had the opportunity an EBRD conference to meet jointly with the Deputy Energy Ministers of Uzbekistan, Kyrgyzstan, Tajikistan, and I was particularly impressed by views that I would not have predicted when I left SCA that Uzbekistan would become the foremost champion of energy transition in Central Asia.  But this is a country that has committed itself to 25 percent renewable power by 2030 which is an admirable level of ambition.

One issue that has been a priority for me, for Secretary Blinken, for Secretary Kerry in our dialogue with Kazakhstan has been methane.  Because Kazakhstan is a major and highly professional fossil fuel country it is also a country which has not yet signed the [Global Methane] Pledge.  I was encouraged by my discussions last week with Deputy Foreign Minister [Meredov] that we’re making progress in that dialogue which was also conducted in Houston with the Energy Minister, with Ambassador [Kazykhan] [inaudible] in Washington, DC.  Because this is a really important opportunity I think to both highlight Kazakhstan’s international role, a responsible position it has already staked out for instance on issues around fossil fuel reliability and its admirable decision on how to manage its nuclear and uranium resources.  So this is something we hope very much we’ll be able to work together on.

I would also emphasize in my engagements in particular with some of our IOCs how seriously all of our companies take their partnership with Kazakhstan.  It is a country in which companies like Chevron and Exxon-Mobil have invested tens of millions of dollars.  They are quite serious about that investment.  They are [inaudible] that investment.  They also are all watching very carefully the vulnerability that arises from our collective reliance on CPC, a pipeline which is the principal exit point for Kazakh crude to global markets.  An important source of supply, especially for a couple of key European allies.  So we are very, very interested in the continued operation of that pipeline, which I should emphasize is not affected by US sanctions.  We have worked very closely with Treasury so that everybody understands that.  The crude oil which comes from Kazakhstan through the CPC pipeline and through Russia is not sanctionable.

But we have also been pleased — and this goes back to Eric’s time in government — that we have been able to work with our Kazakh and Azeri partners to begin developing some alternative routes.  There is more that can be done working with the BGC pipeline, working with [Baku-]SUPSA.  I will be in Baku at the end of this month continuing that conversation.  We see that at this stage as largely a commercial transaction between SOCAR and KMG, but it’s a commercial transaction that enjoys the strong support of the United States.

If we’ve got time, I’d like to take a couple of minutes for questions and answers, if that would be of interest.

What I would emphasize to everybody is the degree to which, for me and my team in the ENR Bureau, Central Asia is a priority.  Kazakhstan has been an extraordinarily gracious and positive interlocutor for me in this new role, but also for the Bureau.  I am personally committed to the reinvigoration of the US-Kazakhstan Strategic Energy Dialogue which is a joint undertaking of State and Department of Energy which sort of fell by the wayside for a couple of years, and we will change that in 2023.  On that, Ambassador, you have my firm promise.

But I’m also very interested in the issues that Jennifer raised around how to leverage the business relationship.  Fred properly put a spotlight on regional connectivity.  And I would just say in this regard, thinking back to my PDAS role how valuable the asset of the US Consulate in Almaty and their regional AID office and the regional programs that were run out of that office on energy and other issues are.  And I think as I reflect on the C5+1 that I joined with Secretary Blinken back in September at the UNGA, and as I look to the future, there will be a very receptive audience from the Secretary’s team, from myself, from Don, from [Zaline], the others involved in this enterprise for exactly these kinds of business facing engagements.  Because it’s very much a part of what we’re trying to do with Kazakhstan but it’s also what we’ve been discussing with the Turkmen, with the Uzbeks and with many others.

So thank you very much, Ariel, for inviting me back.  It’s great to be back with the family and I look forward to a little bit of the conversation.

U.S. Department of State

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