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Lethbridge Herald Newspaper Archives

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Lethbridge Herald {Newspaper} - 1974-01-16,Lethbridge, Alberta Russian bid for gas loan faces U,S. resistance By FRANK FURTTER WASHINGTON — A Russian bid for United States loans to develiç Siberian natural gas has posed a new political problem for the Nixon ad* ministratiun, both at home and ab^d Among the many sides to thé problem are the survival of the policy of detente with the Soviet Union, the energy shortage, relations with Israel and the Arabs, President Richard Nixon’s shaky standing in Congress and the influence of a powerful private industry lobby here. The problem has been brought to a head by the current consideraüon by the U.S. Export-Import Bank of an application for M9 million worth of credit by the Soviet Union. The application was initiated last Oct. 29. One source said a decision is expected soon. The credits will pay for American equipment used in preliminary exploration of natural gas fields in Eastern Siberia. A matching amount ol J49 million will be put up by private U.S. companies and the Soviet Union will contribute another ill million, making a total price tag of $110 million for preliminary work in the exploration and development of the Siberian deposits. Last summer two U.S. companies, El Paso Natural Gas Co., and OccidenUl Petroleum Corp., signed a letter of intent with the Soviet foreign trade ministry for an exclange of American equipment and knowhow for huge gas imports to the U.S. West Coast. The 25-year deal is said to involve construction of a Soviet pipeline, a gas liquefaction plant and a tanker fleet. A preliminary estimate put the cost of financing at t2 billion and the value of the gas imports at $10 billiwi. Japanese interests have also taken part in the preliminary negotiations. Another consortium of U.S. companies, including Tenneco Inc., Brown and Root and Texas Eastern Transmission Co., has been working on plans to develop gas fields in Western Siberia for export to the U.S. East Coast. The major problem for both groups is raising the money. The Russians badly want U.S. capital and technology to assist in development of their gas resources in Siberia. The prospect of sewing up long term supphes of natural gas for the latter part of the century is at least superficially attracUve to Americans looking ahead to the future implications of the general worldvrtde demand for energy. The present short term shortage has increased pressure for policies to meet future needs; any possible project receives attention these days, whatever the cost or practicality. But in dealing with the Soviet Union the U.S. natural gas industry, despite a formidable Washington lobby, is up against some tough resistance. So, for that matter, is the Nixon administration which has developed the doctrine of detente and is desprately trying to preserve it. The Middle East war put a severe strain on tto progress made by Nixon In relations with the Soviet Union. It reawakened partisan differences in the U.S. as well as focusing atun-tion on energy problems and cm the western **For*^ail these reasons Nixon might well look favorably chi a deal for Russian natural gas, especially when it is being promoted by some of his big business friends. However, also for all these reasons other U.S. iwlitical leaders in Congress can be expected to take exactly the opposite view and try to prevent such a deal with the Russians. Nixon badly wanted to butter the Russiara with the largely symbolic gesture of grant-them most-favored nation trading status which will allow the rather small volume of Russian goods exported to the U.S. to compete on the market with western products. , , ^ But the trade legislation which included this provision, was stalled last year when it became clear that Congress was not about to permit any such thing unless the Russians agreed to freedom of emigration, primarily for Jews but subsequently extended to cover aU Russian citiiens. The House of Representatives went even further. It did pass the trade bill but tacked on another restriction—no financial credits without freedom of emigration either. The Senate is exnected to do the same when the l^islatlffli comes up after a recess which ends Jm. 21. This puts the export-import bank in a very awkward positim. If it heeds the wishes of the Nixon administration and its business friends it runs the risk of what congressman Les Aspin says win be “ignoring a congressional directive. " Aspin, a Democrat from Wisconsin, claims the bank is about to approve the credits sought by Russia, which he says will be “a disastrous ripoff of the American people.” Export-import bank loans run at six per cent, which is a tremendous concession when the prime rate of interest for Americans is set at nine per cent by the Federal Reserve. Aspin is also concerned about the price American consumer might have to pay for Russian natural gas. which he claims can be as much as five times the current U.S. wellhead price.    ^ The answer to this by companies such as El Paso is that it will be 1980 before any of the gas actually arrives, by which time the domestic price might easily be just as high. The time factor is also stressed by Canadians in response to fears that massive U.S. imports of Russian gas might jeopardize the market for Canadian exporters.    ^ ■ It IS somewhat Ironical, too, that Americans who are talking up the Siberian gas deals, are not raising the questions of national security that are considered so vital when they are rejecting the idea of a pipeline through Canada to carry oil from Alaska to U.S. markets. However, this is a point which is bound to be raised in Congress when it gets around to the issue. And it will probably do so very quickly fo prevent the export-import bank from setting any precedent, or a fait accompli, by speedy approval of the initial |4« million wortti of credits. If Congress does pass the trade bill quickly, with the attached restrictiwis on doing business with the Russians, Nixon will find himself in a dark comer.    ‘ ^ The president can veto the legislation and sacrifice the negotiating power on international trade reform which it also contains and which he needs to deal with the rest of the world. But even if be does veto it the chances are that Congress will override the veto, as it did on the war powers resolution last year. Then Nixon will lose both at home and abroad, and his detente, which is about the only thing going for him, might be wrecked. ' If there are any doubts that Nixon’s personal predicament affected U.S. foreign relatltms they can be dispelled by this issue which precipitates a conflict of Russian and American interests and a commingling of them as well. SET HE lESr kM PRICES EFFECTIVE in Lethbridg«, January 16-19« 1974. Household Needs! FACIAL TISSUE Scotties Assorted Colors SOO'S ply pitg* ........ 3i«l SHAMPOO Lady Patricia, 4 Kinda or Lemon Cram* RInae 20 fl. oz. bottle SAFEWAY PRICE SNOW STAR ICE CREAM 88 c Scott assort«! 200-1 ply 2 roil pkg. Special ..... Paimoliva 32 fl. oa. bottle. Special For unbleacliaMea 26 oz. net wt. pkg. Special Bathroom Tissue Paper Towels Liquid Detergent Javex Powder Detergent Powder Cleaner & Conditioner Pine Cleaner Detergent Powder Purex Aaaorted Colora or White 420-2 ply, 4 roll pkg.SpMBlal -- Arctic Power Cold Water 5 lb. box. Special ....... The Tannery Vinyl 7 ox. net wt. tin. Special Lettoli All Purpose 28 tL oz. bottle. Special AH Olahwaaher SO oz. net wt. pkg. Special 79* 75* 99* 99* 209 99* 1“ iasteJit Spaghetti in T.S. or Creamed Corn Canada Choice, 14 fl. oz. tin 4! 89 PINT CTN. 139 MANDARINS Genuine Japanese Oranges Enjoy this seasonal treat. Box .......... Ivf« V LIb W Choice Orange«, bag ........... ■ * I jfllAPPIBcAi'foo fll W kkW Red Dellcileiis Can. Fancy ........” S I ^CABBAGE ¿¿n'i.-ss ’.................10® ^CARROTS .............2S59® ... You Can’t Beat ALBERTA POTATOES GEMS OR REDS ........10»99* Canada No. 2 C«llo Bag Spacial ____ GEMS Bake Size Canada No. 1 Grada Callo Bag Spadai .......... 5t79 We reeerve the right to ilnrit quantmaa. AFEWAY Ì.ANAOA SAFEWAY LIMITED MISCaLLAMlOUS HKDSi COPPEE RICH atch'* FrMMt, 1( n.    A Jta« »I. etn. tpaelat ...............— * RED LABEL TEA eiuaRlMMA . iifc.piig,a«*iWïM« .............. LUNCH SAGS Kttelw>Cr«flar*wA nig.«fM. SaWwiT^rtc* DOG FOOD Ootnataratr a«fl MM« lew. nel wl pat. <|WW ;