From the conversation of the President of Azerbaijan Republic Heydar Aliyev with the delegation of Israel headed by Joseph Mayman, the President of the company "Merhav" - Presidential Palace, February 16, 1999

Heydar Aliyev: I remember my meeting with you, at that time you were engaged in agricultural matters. We wanted to cooperate with you. But later it did not continue for some reasons.

Joseph Mayman: I have not forgotten my meeting with the president. It was a great honour for me to meet with You that time and it is a great honour for me now. We came to this region with one other project but after we got engaged in oil refinery. But we believe that the cooperation with the president and with this country must grow. If the president allows, I would say that Baku is more beautiful than it was five years ago.

Mr. President, allow me to convey You the greetings of official persons of Israel. These greetings are on behalf of government and opposition. Both Mr. Peres and Mr. Netanyahu send You greetings and they are in a high opinion of You. They both know that our company is here. There are historical relations between Azerbaijan and Israel, the attitude to the Jews is good in Azerbaijan. These relations are not connected only with the history, but at the same time, it comes from the strategic importance of Azerbaijan attached in Israel. There is a great honour in Israel to the results which You achieved during the last years as a president in this country. By the way, we hear the same words and ideas in Washington. They see Azerbaijan as a regional, essential force. Certainly the east- west corridor of Azerbaijan for the United States of America has exceptional importance.

It is known that Azerbaijan is the country exporting oil, and it is intended in the future to be large gas producing country. To our opinion, Azerbaijan solves itself what will occur in the region in the future.

If the President permits me I would tell about the activity of our company. Having started our projects with agriculture, then we expanded our activity in the sphere of energy. Both the government of Egypt and the government of Israel believed us and helped to establish the first joint enterprise. It is the project in 1,2 million dollars and the enterprise will be constructed in Egyptian town Alexandria. We cooperate in this sphere with the government of Egypt and the 20 percent of this plant belong to us. It is not only the economic capital of course, but at the same it has a great importance from the strategic point of view between Israel and Egypt and it is profitable for both countries.

At the second stage of our work, we will lay gas pipeline from Egypt to Israel, and along with it, the electric power station of Egypt will deliver the energy to Israel. This project is approved in Egypt on the level of president, it's value is 1,5 billion US dollars. In the forthcoming 3-6 months we will solve the remaining formalities, in order to start the realization of the project. A number of companies have joined this project and very profitable conditions of financing are offered. They provide us with the means for thirteen years and the term of returning begins in three years.

You can compare us with an opera singer, but for the time being we are not singing in theatre "La Scala". The curtain of this opera is not opened, while we bring our project to Azerbaijan and begin to work here. Mr. President, we hope that we will take part in the projects in Azerbaijan to justify your confidence.

Heydar Aliyev: I accept the greetings from the Prime Minister Mr. Natanyahoo and the former prime-minister Mr. Shemon Peres with great satisfaction. Convey them my regards and kind wishes.

I have listened to you with great satisfaction. I am glad that today's very important strategic situation in the country and, at the same time, the works being done in Azerbaijan, attracts attention and interest in Israel, in the United States of America and in Washington.

The information given about your company is also very interesting for me. When I first met you five years ago, you were really engaged in agriculture. And now you are engaged in such important spheres as oil-refining, gas pipe line and electric power stations. I wish you every success in this work.

The interest which you show to Azerbaijan is very important for me. You know it is about five years that the large companies of the world and other companies arrived to Azerbaijan and cooperate with us. And we see the beautiful consequences of this cooperation. I positively apprehend your wish to work in Azerbaijan. I am ready to listen to your concrete thoughts about this.

Joseph Mayman: Mutual enlargement of strong cooperation at a high level as well as at the lower levels meets the interests of our countries and also the interests of the USA and Turkey. There is an issue to supply the European markets not only with the products of Azerbaijan, but also with the products of Kazakhstan, Turkmenistan and other countries of Central Asia.

After we successfully completed some projects in Turkmenistan, we were asked to make thinking over the Transcaspian project. We are sufficiently informed about the work carried out in Azerbaijan, and in particular, we want to congratulate You in connection with the foreign investments brought to Azerbaijan thanks to the President. When in Washington, we constantly felt that the mention of Azerbaijan was perceived with great sympathy and Azerbaijan was getting much more support in different circles of Washington.

The President Niyazov asked us to find out the degree of realization of the issue. And we did not think to come here unless we believed in the implementation of this project in sufficient measure. Today we hold decisive opinion that we can offer to the President a number of these ideas as they are quite real projects. We did not solve anything without Your consent. Mr. President, therefore we decided to meet You and discuss all alternative variants. As You know, there is large competition on different projects and routes. Therefore we want the permission of the president for the participation in Transcaspian gas project. It seems to us, that by means of this, we can transport the Turkmen gas and the Azerbaijani gas to Turkey in the future and from there to the European markets. We are quite confident that the government of the USA supports this project on all levels. I have a feeling that we make Baku-Ceyhan pipeline alluring from the economic point of view from now on.

I want also to note that we have got the economic support of the US government. The Eximbank of USA has informed us about its readiness to finance the project in total 3 billion of dollars, separating 1 billion dollars. At the same time this project was supported by the credit company of the USA OPEC and other big financial companies.

We have completed the preliminary studies. There was reached an agreement about the volume of gas which will be sold to Turkey by Turkmenistan on the first stage. I think it is high time to make a report to the president. In the future we will make a report to the president about our work strategy, at the same time inform him about the participation of Azerbaijan in this multinational project.

Heydar Aliyev: The work scheduled by you is of great value. We have worked out the spacious program on the joint exploration of oil and gas deposits of the Caspian sea with foreign companies, on the delivery of the future oil and gas to the world markets. And at present they are underway. I think that one of the main works implemented by Azerbaijan in last years was the discovery of oil gas deposits of Caspian Sea and to invite the companies of the world to this area. In September 1994 we signed the first large contract which is called the "Contract of Century". As a result of implementation of this contract in November 1997, we began the extraction of oil from the deposit "Chiraq" in the Azerbaijan sector of the Caspian. We have constructed one oil pipe line for its export. This is the pipeline of Baku-Novorossiysk. We deliver oil extracted from the deposit "Chiraq" to the world market. We build the second pipe line on the route Baku-Supsa. This pipeline has already been built and we will give it to exploitation in April.

Alongside with it, the contract signed in 1994 envisaged the necessity of the construction of the main, large oil pipeline for the export of oil to the world market. On 29 October of the last year, Turkey, Kazakhstan, Uzbekistan, Azerbaijan and Georgia signed the big declaration in Ankara on the construction of oil pipe line Baku-Ceyhan. Turkmenistan also had to sign this declaration but yet did not sign. But for all that, on the same day in Ankara there was signed an agreement between Turkmenistan and Turkey on exporting of turkmenian gas through the Caspian Sea to Turkey. The United States of America took an active part during their signing. The minister of energy of USA Mr. Richardson has put his signature to our declaration. The United States of America supported the construction of oil pipe line Baku-Ceyhan and also the gas pipe line Turkmenistan-Turkey.

Now I see that you are engaged in the construction of gas pipe line Turkmenistan - Turkey. I congratulate you on this occasion. The president Niyazov wrote me a letter about you. He introduces you to me and asks me to meet with you and discuss this matter. The President Shevardnadze phoned me on this occasion. You have met with him too. He also asked me to meet with you. I have received a letter of the President of Niyazov and very attentively accepted the request of the President Shevarnadze. But I thought that I know you for a long time, when you were not acquainted neither with Niyazov nor Shevardnadze. But you arrived here at the end. I have now understood that you wanted to settle the problems there first and then come to me.

Joseph Mayman: Mr. President we wanted to settle every question separately and then to come to you.

Heydar Aliyev: You are right, because first of all you should have solved the problems with them.

Joseph Mayman: Mr. President, we know that many companies and people arrive here with different ideas. Unfortunately it is not possible to realize all these ideas. Therefore we decided to solve first of all the questions separately and then to come to You.

Heydar Aliyev: You have made right, because the owner of the Turkmenistan gas is Turkmenistan and the President of Turkmenistan. If he would like to supply the Turkmenistan gas to Turkey by this route, we can discuss this question undoubtedly. I understood that the President of Turkmenistan have taken a decision on this.

Joseph Mayman: The strategic decisions were taken in Turkmenistan. Their decision is to make use of different gas pipe lines. The work, intended by them in connection with a line through Afghanistan and Pakistan, moves more slowly than they expected. Therefore as an alternative line, we have offered the gas pipe line which passes on the bottom of the Caspian Sea. Now the opinion of the President Niyazov about Transcaspian project is final. And we think if the project will be mutually beneficial it can be very successful. Really we have a desire to export the Turkmenian gas to Turkey. But at the same time we do not consider Azerbaijan only as a transit country. We think to deliver the production of Azerbaijan to Turkey and from there to the world markets in future. To our opinion Azerbaijan will be very active partner in this project and will play an important role in a reach of decision. I can not say anything to the president until this project will be completely ready.

Heydar Aliyev: If the President Niyazov adopted the final decision about this, I accept it positively and declare to you that I agree that the gas pipeline Turkmenistan - Turkey pass through Azerbaijan. This issue can be discussed specifically. We can also tell our opinion to Your proposal about the delivery of the Azerbaijani gas through the pipe line Turkmenistan-Turkey to the world market. Today Turkmenistan has gas and we will extract gas in a large volume in the future. Therefore, we face the problem to deliver the Azerbaijan gas to the world market. We can discuss our cooperation with you on this occasion.

"Azerbaijan" newspaper, February 18, 1999.