On March 10, Poland's Donald Tusk will make his first visit to Washington as Prime Minister for talks with George W. Bush. Reports suggest missile defense will top the agenda. Perhaps one item neither leader will want to talk about is the announcement a few weeks ago by Poland's gas monopoly (PGNiG) that it could help Iran to develop its natural gas deposits.
From the U.S. perspective, Poland would be wise to support efforts to isolate Iran. The ongoing standoff over Iran's nuclear program makes the situation particularly pressing; in an effort to pressure Tehran to suspend uranium enrichment, Washington has urged European governments and companies not to invest in Iran's energy sector.
Yet from Warsaw's perspective, Iran is not the chief boogeyman - Russia is. Like other countries in Central Europe, Poland is concerned about Russian influence in its former satellites. And the means by which Russia plans to enhance its political clout revolve around its monopoly on the region's energy supplies. The United States recognizes this problem, but Poland has taken the lead in exploring ways to dent the market share of Gazprom, Russia's state-owned gas giant.
Here is where Iran could fit in. The Islamic Republic holds the world's second-largest gas deposits (after Russia) and is Gazprom's natural competitor. The country also hopes to export liquefied natural gas (LNG) in the coming years. Poland, for its part, has long sought to build a LNG terminal on its Baltic coast. But to do this Poland needs contracts with a long-term supplier. Though technical and financial hurdles remain, observers suggest the preliminary deal between PGNiG and the Iranians, signed February 11, could pave the way for such contracts.
The Poles may ultimately forego their Iran option. While PGNiG has no North American business that could be hit by U.S. sanctions, Washington could make it difficult for banks to finance the project. But if PGNiG does go to Iran for gas contracts, the U.S. sanctions machine should consider sitting this one out for the sake of the U.S.-Polish relationship.
Doing so would allow U.S. officials to avoid having to chastise an ally and call into question America's commitment to Europe's energy security. The United States has supported Warsaw in its search for non-Russian supplies, and the Kremlin has done a good job of derailing alternatives to Iran. An additional complication is that U.S. officials have already turned down Polish requests for greater American involvement (i.e. co-financing) in a Poland-backed project to access Central Asian gas via Ukraine. If the Bush team complained now about Poland's energy choices, the Poles may snap back that Washington is being hypocritical and ignoring Warsaw's concerns about Russia. Furthermore, Bush needs Polish assistance on both the missile defense shield and Afghanistan - two items on which the Administration would like to claim some success.
At the end of the day, sometimes staying quiet is the least bad option, especially when trying to contain both Gazprom and Iran at the same time.
Ryan R. Miller is a Research Analyst at the Center for European Policy Analysis (CEPA) in Washington, DC.