Background

Is there a model for Western Hemisphere energy cooperation? How would individual countries and the hemisphere as a whole benefit from cooperative understandings for hemispheric oil and natural gas? What impediments exist to creating a cooperative agreement and how can the region overcome them? And finally, what will be the consequences of not adopting a plan for energy cooperation in the Americas?

The rationale for energy cooperation in the Western Hemisphere seems clear: countries in the hemisphere should welcome energy cooperation to secure the necessary investment and infrastructure for oil and gas exploration. On the production side, many of these economies rely on energy revenues to provide much-needed investment to drive economic growth. On the consuming side, increased production of energy in the Americas will benefit those countries that now rely on often volatile, extra-hemispheric sources. Cooperative understandings will therefore increase confidence in hemispheric demand for producing countries and further develop their capability to meet these demands and their internal social, political and economic needs.

Despite these opportunities, significant impediments to a hemispheric agreement persist. CSIS recognizes the need for a comprehensive approach and detailed country-by-country political analyses to address these challenges and possibilities. Headed by Dr. Sidney Weintraub, the William E. Simon Chair in Political Economy at CSIS took on this two year Energy Project and published the findings in Energy Cooperation in the Western Hemisphere: Benefits and Impediments. Critical to the research included: historical factors, especially in Bolivia where the government has been unwilling to build a gas pipeline through Chile because of historical grievances; political divisions, as seen by Mexico’s inability to reach agreement on private equity investment in gas exploitation; technical challenges, including the capacity to ship more liquefied natural gas (LNG) from Trinidad and Tobago and other sources to U.S. ports; dangerous conditions, especially in the Colombian case where large oil reserves conflict with guerilla activity; ideological fervor, currently creating political tensions in Venezuela; and intra-hemisphere political disagreement which has historically hampered the countries’ ability to successfully forge hemispheric cooperation. Political analyses of each country and the challenges they face were essential in the extensive research conducted on behalf of Energy Cooperation in the Western Hemisphere: Benefits and Impediments. 

In addition to these research points, CSIS and The William E. Simon Chair in Political Economy used a three-pronged approach in its examination of energy in the Western Hemisphere: 1)extensive in country-research and interviews which set the empirical basis for the analyses of current arrangements, infrastructure, and existing impediments to cooperative understandings; 2) interviews and feedback from key stakeholders, including governments, major oil interests and other relevant actors were crucial for further analyses of current conditions and future projects, and analyses of political will for hemispheric cooperation; and 3) convening a working group of experts and practitioners to discuss findings and ways to overcome challenges that will build consensus around policy recommendations for the future of energy policy in the region.

The conferences scheduled in Washington DC, New York, Ottawa, Edmonton, Calgary, Mexico City, Rio de Janeiro, and Bogota are serving as an opportunity for CSIS and The William E. Simon Chair in Political Economy to share their findings and offer predictions to the future in hopes of creating a more stable, energy cooperative Western Hemisphere.