GERMAN COAL PLANT DEAL EXPECTED WITH SOVIET

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83M00914R001000060015-3
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 20, 2016
• Document Release Date: February 20, 2007
• Sequence Number: 15
• Publication Date: September 18, 1982
• Content Type: OPEN SOURCE

pproved For Release 2007/02/20: CIA-RDP83M00914R001000060015-3
THE NEW YORK TIMES
18 September 1982
German Coal Plant Deal
Expected With Soviet
By JOHN TAGLIABUE
spo1UtoMANewYoekTt
BONN, Sept. 18-Top West German
and Soviet officials are exe m
outline a far-reaching plan
fps in Moscow next week for Bonn to
deliver sophisticated coal processing
plants to the Soviet Union in return for
energy supplies, a West German Gav-
erntment official said today.
The disclosure came as negotiations
were drawing to a close on a multibil-
liondollar gas pipeline project be-
tween the Soviet Union and a Western
European industrial and banking
group led by West German companies
and credit institutions.
The new project is expected to cause
serious concern in the Reagan Admin-
istration, which is seeking a modera-
tion of technology exports to
Europe and has strongly cautioned
against excessive Western the =
energy dependency on
Union.
U.S, CooperationOffered
Reagan Administration has of-
Bonn extensive energy coopera-
in an effort to provide an alterna-
tive to Soviet energy, but the news of
the: proposed new project indicates
Boon proles with the Wet
U 'West German Minister of Eco.
Count , and
Otto prime in Minister, o
the Soviet
Leonid Outline A. t plan at a &8 40 Insetlf
lion
m Moscow tt'I!-of
a
includethe formation ot a
joint soviet-German Energy CommU-
at According to the official, who will
accompany Count Lambsdorff, the
proposal involved construction' of a
complex of facilities near extensive
coal fields in the vicinity of Kansk and
Achinsk, in south-central Siberia, that
would inclde plants to break coal
down into simple gases. The 96908
would be used as feedstock for a
genation. plant to produce quid
energy sources, such as methanol.
Such energy products could be shipped
more easily than bulk coal within the
Soviet Union, or abroad as a fuel ex-
port, the official said.
The official declined to estimate the
value of the project. One pse
next week's talks, he said, imAd be to
outline a feasible was for the project.
~y official paraialprobatter ddeeal,
meaning that. Moscow would pay at
least part of the construction costs
with deliveries of synthetic gas or
other energy or chemical products to
West Germany.
Several large West German compa-
nies have the technology to undertake
the project, including Krupp-Koppers,
the subsidiary of Friedrich Krupp, the
steelmaking concern, or Lurgi, a sub-
sidiary of Metallgesellschaft, a diver-
sified engineering and metals compa-
ny.
Count Lambsdorff will be accompa-
nied by experts on Eastern trade, such
as Otto Wolff von Amerongen, presi-
dent of the German Chamber of Indus-
try and Trade; and Karlheinz Bund,
the chairman of Ruhrkohl, Germany's
largest coal company, which has
worldwide experience in coal gasifica-
tion and liquefaction projects.
The delegation will visit several
energy projects in central Siberia over
the weekend, the official said.
$2 Billion a Year to Soviet
Starting in the "mid-1980's, he said,
the Soviet Union will earn $2 billion to
$3 billion annually on deliveries of
natural gas to Western Europe
through the envisioned pipeline, which
is to carry 40 billion cubic meters of
gas a year to several Western Euro-
pean countries. The projected $10 bil-
lion pipeline, the most expensive ever
undertaken in East-West trade, would
span 3,500 miles and would supply
natural gas to seven European coun-
tries, increasing the Soviet share of
their natural gas supplies to roughly 20
percent from the current 15 percent.
Both the Carter and Reagan Admin-
istrations have voiced serious dis-
pleasure to the West German Govern-
ment because of its pursuit of exten-
sive energy cooperation with Moscow.
At. the Ottawa summit meeting in
July, President Reagan asked Chan-
cellor Helmut Schmidt to reconsider
the pipeline deal, and offered United
States energy cooperation.
West Germany imported 7 percent
of its primary energy sources from
Russia last year, including 17 percent
of its natural gas supplies. When the
pipeline is completed, the Soviet share
of Germany's natural gas supplies is
expected to increase to roughly 30 per-
cent, an amount Bonn calls safe.
Nothing Comparable Seen
A State Department delegation from
Washington is expected in Bonn' later
this year to offer proposals for energy
aid.
But in an interview with a West Ger-
man economics magazine, published
today, Count Lambsdorff said he saw
"nothing that could be offered us that
corresponds to the scale of the natuf hi
gas project."
"Certainly we are interested in such
talks with the Americans about coal
deliveries, about the further develop-
went of nuclear power, but we need
natural gas, and America Cannot offer
that," he said.
The official said Count Lambsdortf
would likely meet with the Soviet
Prime Minister, Nikolai A. Tikhonov,
and would touch on Poland, during the
five days of talks,, to admonish the
PO-
Soviet leader that inerven~
land would jeopardize
eration.
But asked
tion would leeadthto an economic bo
cott, Count Lambsdorff replied. 'I
don't speak of a boycott." He added
that he was "of the firm conViction it
would lead to losses, to limitations, to
difficulties." He said, "That would be
unavoidable in such a case."
Privately, West German Govern'
ment officials have recently conceded
that an invasion of Polan~~lylikely not
seriously delay, but cause the cancellation of, major eco-
nomicprojects.
Approved For Release 2007/02/20: CIA-RDP83M00914R001000060015-3