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Cheney Pushes Nabucco

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The Wall Street Journal is carrying a story on VP Dick Cheney’s trip to the Black Sea to express support for Georgia and push for alternative pipeline projects such as Nabucco.

“The Russians have demonstrated they can close that corridor through Georgia any time they want,” said John Bolton, President Bush’s former U.N. ambassador. U.S. officials reject that. “The Georgian energy corridor is safe,” Deputy Assistant Secretary of State Matthew J. Bryza, one of Nabucco’s major supporters, told an audience in Brussels Monday. He stressed that Baku-Tbilisi-Ceyhan and the South Caucasus Gas Pipeline, which transports Azeri gas to Turkey, were unaffected by the fighting. Mr. Bryza also said European energy companies behind Nabucco and the Turkey-Greece-Italy pipeline have told him they are determined to proceed with the two projects. “They haven’t slowed down at all,” he said. “They are anxious to line up gas supply contracts with Azerbaijan as soon as possible.” But some analysts said the Georgian war could scare off investors, making it hard for the consortium to raise the €7.9 billion ($11.5 billion) needed to build Nabucco — a task already complicated by the global credit crunch. Plans to expand Baku-Tbilisi-Ceyhan’s capacity may also be in jeopardy. “This increases the risk profile enormously,” said Jonathan Simpson, head of European projects at international law firm Paul Hastings. “Without the EU and the U.S. stepping in and subsidizing them, they won’t get built. And so far they’ve shown no inclination to do that.”