128. Memorandum From the President’s Assistant for National Security Affairs (Brzezinski) to President Carter1

SUBJECT

  • Cooperation for Energy Development

In late June, President Perez quietly raised the issue of energy conservation with you.2 His purpose was probably two-fold: to obtain some technological help for developing the Orinoco Tar Belt and to obtain our support for two regional organizations OLADE and SELA which Venezuela leads.

From our perspective, we have an interest in responding to his proposal, which he is likely to repeat, for three reasons:

1. We have an interest in encouraging Venezuelan leadership in this and in other areas in which other developing countries could benefit from new and appropriate technology.

2. We have a number of other important interests in U.S.-Venezuelan relations, and we want to be responsive when Venezuela raises certain issues.

3. We do want to help develop the Tar Belt, though most recent studies indicate that such development is not economically feasible now, and not likely to be for a number of years.

In addition, as State’s paper points out, our interests in the field of energy cooperation are primarily global, and to this end, we have solicited support from other industrialized and OPEC countries and LDCs for the International Energy Institute. This would facilitate technical assistance and energy technology development for the LDCs. NSC supports State’s recommendation that we continue to pursue this ap[Page 437]proach, but I disagree with State’s position that there is such a clear-cut choice between a regional and a global approach. Both are needed.3

Attachment

Paper Prepared in the Department of State

COOPERATION FOR ENERGY DEVELOPMENT AS A RESPONSE TO PRESIDENT PEREZ

Issue for Decision

The issue is whether we should continue to explore with the Venezuelans possibilities for bilateral cooperation in the development of new technology for energy production and/or indicate to the Venezuelans our interest in discussing with them a Latin American regional approach to cooperation in energy planning and technology.

Essential Factors

In June, Presidents Carter and Perez agreed that energy should be an area for continuing US-Venezuelan consultation and cooperation and that Schlesinger and Energy Minister Hernandez, who met during the visit, should meet again for this purpose. The meeting will take place later this year, after preparatory discussions in late September or early October. We hope that at the meeting we can reach agreement on a process for cooperation in energy technology.

We are not currently pursuing with the Venezuelans the suggestion for US-Venezuelan leadership in a hemispheric program for cooperation in energy technology and planning raised by Perez during the previous Administration. In the past he also raised the possibility of examining what role, if any, existing Latin American organizations might play, such as those for economic affairs (SELA), energy development (OLADE), and nuclear non-proliferation (OPANAL). The US is not a member of these organizations and we have had limited dealings with them thus far.

As part of our global approach to energy problems, we have proposed an International Energy Institute (IEI), to be backed by industrialized countries and leading oil exporters, to facilitate technical assistance and energy technology development for the benefit of LDCs. The development of such an institution (which is supported by [Page 438] UN Secretary-General Waldheim) could form part of an agreement to resume a multilateral energy dialogue if, after an initial cautious reception, it attracts sufficient support from LDCs. These issues will be played out over the next several months, with one possible outcome an IEI decentralized along regional lines.

Options

1. Use the upcoming energy talks with Venezuela to revive the subject of regional energy cooperation.4

This would be responsive to an earlier Venezuelan suggestion, and by raising it we could better evaluate whether the Venezuelans have specific ideas of potential mutual benefit. Raising a proposal not currently being pressed by the Venezuelans, however, could raise false expectations, as we are likely to shape our multilateral energy policy in response to interests that are broader and deeper than regional solidarity.

2. Leave regional energy cooperation in abeyance pending the outcome of UN and other multilateral consideration of the future of the energy dialogue and the IEI .

This would save the multilateral energy technology “carrot” for possible use in conjunction with some form of ongoing energy dialogue of benefit to all oil-importing countries. At the same time, it would not foreclose a regional approach as a complement to global energy cooperation. It would not, however, acknowledge special concern for the energy problems of the Latin American region.

Recommendation

That you approve Option 2.5

  1. Source: Carter Library, National Security Affairs, Staff Material, North/South File, Box 46, Pastor Country Files, Venezuela. Confidential. Sent for action. Under the subject line, Brzezinski wrote: “Mainly with President Perez.”
  2. Carter met with Pérez on June 28 and 29. At their June 29 meeting, Carter said that “he was greatly concerned about increases in the price of oil,” given that “such increases would contribute to worldwide inflation and serve no one’s interest.” Pérez “complimented President Carter for supporting OPEC by urging Americans to conserve on energy,” and observed that “thanks to oil and OPEC,” the world “realized the gravity of the energy crisis.” Carter “expressed his eagerness to work with Venezuela and with other OPEC nations on scientific research on petroleum production and exploration—for example, on developing technology for the Orinoco tar belt.” Pérez replied that “any agreement to develop technology for the tar belt must be within the context of an overall plan or agreement between the United States and Venezuela.” (Ibid.) The memoranda of conversation of their meetings are scheduled for publication in Foreign Relations, 1977–1980, volume XXIV, South America; Latin America Regional.
  3. Brzezinski added by hand all the text after “pursue this approach.”
  4. President Pérez visited Washington September 6–9 to attend the signing of the Panama Canal Treaty. He met with President Carter on September 7. The memorandum of conversation is scheduled for publication in Foreign Relations, 1977–1980, volume XXIV, South America; Latin America Regional.
  5. Carter checked the Approve option and initialed.