Grand Hyatt Athens
January 29, 2019, 12.30 p.m.
Tom Ellis: [In Greek] Hello, good afternoon, welcome. When I got here, I was speaking with two or three friends who wanted us to talk about the topic of the day, Prespes. [In English] So, I’ll start with one question or two on that, and then we’ll move to energy. I just mentioned that everybody here is interested in Prespes, so let me ask you for your assessment of what is happening, where we are, the vote, and explain why is the U.S. so interested in this agreement.
Ambassador Pyatt: Well, thank you Tom. Let me first thank Achilles for having me here today. It is a great honor to speak especially with Minister Stathakis and Minister Katrougalos in attendance. Let me answer your question this way, and it actually connects to our energy agenda. We see the Prespes agreement which was negotiated by two sovereign governments and passed by the Greek parliament on Friday as a major contribution to the security, stability and prosperity of the wider region. That is why it is so important. And I think, if you look at the response to Greece’s action that came from Washington on Friday, you will get a sense of what a transformational moment this is in terms of perceptions of the role that Greece plays in the wider region. You can see if you look on my Twitter feed, the statements of welcome and support from Chairman Risch, the chairman of the Senate Foreign Relations Committee, from Senator Johnson, the Chairman of the Senate’s Europe Subcommittee, from Senator Shaheen, the Co-Chair of the NATO Subcommittee. You see a great sense of appreciation for the leadership and vision that the leaders in both countries exercised, but also a sense that this is a really important turning point in terms of perceptions of Greece as a source of solutions in the region, and, as we like to say, the role of Greece as a pillar of regional stability. And now just to connect it to what Achilles asked me to come here and talk about, which is energy, because I think you heard from Minister Stathakis a very good review of all the transformative changes that are happening in the Greek energy picture right now, and I’ll have more to say about that later, but I think what I would emphasize even more is that for the United States, our support of Greece’s role as a European energy hub, the role of Revythousa, the importance of TAP, the importance of IGB — this is not just about Greece, it’s about the whole region. It is about how we advance a regional strategy to encourage energy diversification of supplies and sources. So,there is a strategy that lies behind this, and what we see happening right now is a validation of the investment that the United States has been making in our strategic relationship with Greece.
Tom Ellis: This all leads us to one addition to the Prespes angle. As you see we have the main opposition party here, and all the polls show something around 2/3 of the population being against. You as an ally, other countries, possibly companies, are you worried that this agreement might not stand on solid ground or are you certain that this is it, we move on? Because a major part of the population is still opposing it, and I’m not talking about violence – that’s another thing. The thing that — a big, major agreement on which strategies are based is not welcomed by the population in its majority. Does that make you wonder a little bit or is it a done deal, we move on?
Ambassador Pyatt: So, I have stayed meticulously out of Greek domestic politics, and I am going to continue that practice today. But what I will say is I was very encouraged by Mr. Mitsotakis’ comments on Friday at the Economist Forum, both his very strong endorsement of the U.S-Greece strategic relationship and the progress that we have made in that relationship, but also his clear signal that as regards the Prespes agreement, his policy — while he does not agree with it — his policy is to move forward and I think that is certainly a welcome perspective from Washington’s stand point as well. We see Prespes as an important vehicle to unlock the economic potential of Greece’s relationship with its northern neighbors. We see Prespes as a means to help restore the central role that Thessaloniki plays as a European gateway for the whole western Balkans, and I was especially encouraged when I met with Minister Stathakis last week, and we were talking a little bit about the energy sector and the important opportunities that lie ahead in terms of energy linkages between Greece and North Macedonia, in terms of gas pipelines, electricity lines, petroleum pipelines, and that’s just one piece of what I think is going to be a larger story of Greece playing a decisive and predominant role as an economic partner for the NATO ally, which you will now have to the North.
Tom Ellis: And let me move to energy per se and ask you for specific assessment or specific developments, let’s see on TAP,IGB. What do you see are the prospects of their finishing on time – one of them almost is, it seems, and one is just beginning.How will they change for Greece mainly but more for the area also the energy setup of the Balkans?
Ambassador Pyatt: So, this is my third one of these New York Times energy forums, and I think at the first one I had recently been in Istanbul and I had commented there that in Istanbul people were asking, “Is this TAP pipeline ever going to happen?” Today, the TAP pipeline is 98 per cent complete in Greece. This is going to be completed and when it’s done it will be particularly important. Because it is the first new infrastructure built in Europe specifically to bring non-Russian gas to European consumers. Again it demonstrates the central role that Greece plays as a regional player on this. We are very optimistic that IGB is going to begin construction and we hear consistent messages from Sofia and Athens regarding the governments’ commitment to that project. We are hopeful about the FSRU, Revythousa — I want to underline the great importance of what happened last month, the first consignment from Cheniere’s new liquification facility in Texas delivered to Revythousa as the first load injected in the newly expanded storage facility at Revythousa coming on board a Greek flag vessel operated by Tsakos. So, it demonstrates multiple levels of the role that Greece plays, and that was not just the first US LNG export to Greece, it was the first US LNG export to the wider Balkan region. And what is really important is that later this week we are going to have a second US consignment, this one purchased by Mytilineos, a company that has a close partnership with the United States including with GE. Mytilineos will have one consignment delivered later this week again to Revythousa, and a second one on the water. So, I think you are seeing a rapid transformation in terms of the role that the United States plays in the Greek energy story, and that, in turn,is a reflection of the transformational impact that is coming from the United States’ emergence as a major exporter of both gas and crude oil. And both of these developments benefit Greece as an energy importer and a consumer because we help to keep prices down.
Tom Ellis: Actually that was my next question about the U.S. shipments. How big do you feel they will be for Greece and the region? What kind of a player will the U.S. be energy-wise through the LNG?
Ambassador Pyatt: So the United States is going to be a predominant global player. What portion of that global market comes to Greece almost does not matter, because what is happening is LNG prices are being levelized across global markets. And the United States’ emergence, the shale gas revolution in the United States and America’s emergence as an exporter is changing the way global markets work. A lot of that U.S. production, of course, is going to go to Asian markets, it’s going to go to Japan, but Greece benefits nonetheless because that allows you to import your energy requirements at a lower price and most importantly the emergence of alternative options through the expansion in Revythousa, through the construction of the FSRU, through the completion of TAP — that denies Russia the ability to be a price setter when it negotiates with customers in Greece. Russia has to compete with global alternatives.
Tom Ellis: The other big project a lot of us are talking about for quite a while — at some point we were too optimistic — it seems now it might be viable — the East Med pipeline. How does the U.S. view this project — is it viable, not only economically and commercially, but also geopolitically, as it brings together one way or another Greece, Cyprus, Israel, Egypt?
Ambassador Pyatt: Let me start with the geopolitics, and Minister Katrougalos is here, and we heard from Secretary of State Pompeo when we were together in Washington last month, a very strong message of US support for the trilateral dialogue between Greece, Israel and Cyprus, our three democratic friends in the Eastern Mediterranean. The United States believes that geopolitical competition has returned to the Eastern Med, and in that context, we are looking for friends and partners. This trilateral is a very important manifestation of that, and we see the East Med pipeline as a strategically significant project. That’s why my counterpart in Jerusalem, Ambassador Friedman, participated in the last meeting of the Ministers in Israel, and expressed our strong support for the project. Whether the East Med pipeline is ever going to be constructed, that’s going to be a function of markets, it’s going to be determined by commercial demand, but as Minister Stathakis pointed out, there are already multiple levels of conversation going on — some involving those three countries, but the Cairo energy forum was also significant and it shows how all of the players of the neighborhood are thinking about how the energy picture of the future will look different from what it is today, and I think importantly for me they are looking at Europe as the logical destination for that energy, and if you are trying to get energy from the East Med to Europe, whether you are doing it as LNG that is liquefied in Alexandria or you are doing it on a pipeline, Greece is the closest and most economical place to introduce that energy into European markets.
Tom Ellis: It seems that the Minister mentioned the forum based in Cairo, I was wondering, these countries Israel, Egypt, Greece,Cyprus are working together in different alliances, they’re moving ahead and it might be viable, or it might not, but things are moving ahead. LNG is a possibility, and then there’s another player in the area, called Turkey, who has traditionally been a very close ally of the U.S., and we are in a strange situation, but do you feel that Turkey has to be a part of that — because there’s also this idea that the gas should go through Turkey — there was a point where the U.S. was pushing, if that’s the right word, for that angle. What’s your take right now, because a lot of people in Turkey itself say we’re too big to be excluded, while the other countries are moving ahead without Turkey for the time being. How does the U.S. view that?
Ambassador Pyatt: So, I will just say three things on Turkey. One, we are very supportive of the efforts that Minister Katrougalos, the Prime Minister are making to open a new chapter of dialogue with Ankara. I think the Prime Minister’s travel to Turkey next month will be important in this regard. Two, as a practical matter, the TAP pipeline, which I noted earlier is real, brings gas from the Caspian through Turkey, so that’s happening. And then three, the United States will continue to express our opposition to a second pipe of Turkish Stream,which has the effect of deepening European dependence on Russian gas in the same way that we are vehemently opposed to Nord Stream, because it would have the effect of deepening dependence on a source of gas which we believe has been used in the past for political and non-economic purposes.
Tom Ellis: Another question on this so I have to ask this way, both commercial and geopolitical angles, Exxon Mobil, a US company involved in the Cypriot EEZ and Turkey’s behavior is questionable, to put it politely. How do you deal with this? Will Exxon Mobil go ahead, I mean it will go ahead, but will the U.S. government be 100% behind the company if Turkey says and does things? And then my next question, which has to do with the same company, is South of Crete. There’s also involvement in Greece, so what are the prospects there, Cyprus and Greece?
Ambassador Pyatt: So let me do U.S. companies broadly, and start with Exxon Mobil. Of course, we are very excited about the partnership between Exxon Mobil and HELPE and Total for exploration South of Crete. I know Minister Stathakis shares and intensifies my enthusiasm for anything having to do with Crete right now, and we are very hopeful that that will produce real results. But quite apart from that, I think it is very important to recognize how American investors and American companies are taking another look at energy opportunities in Greece. The Minister talked about Tesla, what they are doing on storage. There are a couple of American companies that are very serious about the prospects in Greece on renewables, solar, wind and storage. These are areas where American companies are globally predominant and they would like to bring their technology and know-how to the Greek market. And we think that this is both good for economic growth in Greece, but it’s also good for Greece’s role as a regional hub. And then on the question of Cyprus — and I’ll leave a lot of this to my colleagues in Nicosia — but I will just repeat as we have said repeatedly that the United States, of course, recognizes the right of Cyprus to exploit its own continental shelf, and that is not going to change. We’ve been very consistent on that. But what I would emphasize on the larger Eastern Mediterranean is what I underlined earlier, the US view of the Eastern Mediterranean as a region which demands closer American attention and where there is very important overlap on geostrategic and geopolitical economic interests involved — and we are looking for friends and partners — and Greece is obviously an ideal partner in that regard because of the capacities and the strategic approach that you bring.
Tom Ellis: We are out of time, but let me just as a last question very quickly. A lot of people ask, when you talk to them on a corporate basis, China and other countries are pushing their companies. The U.S. is in a different situation where private companies make their own choices. But when you make announcements that you support US investment in Greece. How can you help in that announcement being materialized? I mean, what is the process once you say, we see Greece as an energy hub? What does it mean for a U.S. company? Do they respond, or is it nice words don’t add up to more than just nice words? In China, the government says, you know what? We’ll put a billion here, we’ll go to Piraeus. We buy this. How does the U.S. government/Embassy work when your policy is to support, let’s say, the energy sector of Greece?
Ambassador Pyatt: So, let me just say two things. One, it doesn’t get any better than this. If you look at what we’ve done at the Thessaloniki International Fair, bringing Wilbur Ross, the very consistent message of support for American businesses, and in particular providing reassurance about the security and political environment that we see here. As you know, Tom, our companies are answerable to their shareholders and they will go where they see predictable rates of return and business opportunities. But I think you can point already to examples of U.S. companies, including in the energy sector, which have come to Greece – and I’ll let them speak for themselves today — the U.S. companies that have come to Greece in part because of the efforts of the Embassy, the U.S. government, the Department of State, the Department of Commerce, have made and what I would underline in the context of this New York Times conference is the very strong focus of the U.S. government from our Department of Energy, our Department of Commerce, our Department of State to the energy component of the U.S.-Greece relationship. And I’ve been here for about three years now, and when I look back at those three years, one of the real transformations that we’ve seen is how important the U.S.-Greece strategic energy equation has become to the overall relationship, and that’s something that I think will endure.
Tom Ellis: Ok, on that note we’ll thank you very much and move to the next panel. Thank you!