3 U: 7//S^3 THE DEPARTMENT OF STATE BULLETIN Volume LXXI No. 1843 October 21, 1974 ASSISTANT SECRETARY ENDERS OUTLINES DRAFT AGREEMENT REACHED BY ENERGY COORDINATING GROUP Transcript of News Conference 525 PRESIDENT LEONE OF ITALY MAKES STATE VISIT TO THE UNITED STATES 53i THE DILEMMA OF CONTROLLING THE SPREAD OF NUCLEAR WEAPONS WHILE PROMOTING PEACEFUL TECHNOLOGY Address by Fred C. Ikle Director, U.S. Arms Control and Disarmament Agency 5U3 THE OFFICIAL WEEKLY RECORD OF UNITED STATES FOREIGN POLICY For index see inside back cover THE DEPARTMENT OF STATE BULLETIN Vol. LXXI, No. 1843 October 21, 1974 The Department of State BULLETIN, a weekly publication issued by the Office of Media Services, Bureau of Public Affairs, provides the public and interested agencies of the government with information on developments in tite field of U.S. foreign relations and on the work of the Department and the Foreign Service. 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Citation of the DEPARTMENT OF State, United Nations documents, and STATE BULLETIN as the source will be legislative material in the field of appreciated. The BULLETIN is indexed in the Readers' Guide to Periodical Literature. international relations are also listed. ks —; Assistant Secretary Enders Outlines Draft Agreement Reached by Energy Coordinating Group The Energy Coordinating Group (ECG) support the oil security of the group as a established by the Washington Eriergy Con- whole before they can fruitfully go on to ference in Febrnary met at Brussels Septem- other, more positive—eventually dominant ber 19-20. Following is the transcript of a elements of the energy situation, which in- news conference held at the Department of clude major joint actions to conserve energy State on September 23 by Thomas 0. Enders, and thereby lower the net imports of the Assistant Secretary for Economic and Bzisi- group as a whole ; research and development ness Affairs, who headed the U.S. delegation the development of alternative supplies, to the Brussels meeting. thereby increasing the output of energy in the group as a whole and decreasing net im- I thought it would be useful to come down ports and therefore vulnerability. here and talk very briefly and then answer This should create a situation in which the questions about the agreement which has demand for and dependence on imported oil been reached in Brussels among the 12 ECG for the group as a whole will significantly countries—that is to say, the European Com- diminish from what it is now. munity less France, Norway, Japan, the Now, in contingency planning, the basic United States, and Canada—and which is principle here is that each country in the now being submitted to governments for group must share on an equitable basis in their consideration, their constitutional pro- the preparation for a new emergency. That cedures, and approval. means that everybody must stockpile oil to This is a far-reaching agreement and a cover their imports on the same basis. And far-reaching expression of solidarity among the agreement sets a target of 90 days. We the consuming countries. If it is approved by are very substantially below that in many governments, as we expect it will be, it will countries now. This means a major commit- form a very strong basis of cooperation in ment on the part of Japan and Western Eu- the energy field among a wide range of in- rope—also to some degree on the part of the dustrialized countries. United States—to carry stocks equivalent to As such, we regard it as a very important 90 days of imports. step forward and a very important conse- The second thing is that all the countries quence of the Washington Energy Confer- agree to take similar actions in a new emer- ence, which launched this cooperative work. gency to curtail oil consumption. This is I would like to go into some detail on the complicated, and I will be glad to go into provisions that it contains. Let me say a it. But basically what it says is that at cer- word about the substance and then a word tain levels of shortfall a given consumption about the procedure. cut will take place, and when the shortfall deeper, another level of common con- On the substance : I think the basic per- gets ception in this agreement is that the consum- sumption cutback will be called for. Then, ing countries need first to express their soli- beyond a certain point, where no figures are darity by determining what each would do foreseen, but where we get into a very se- in a new oil emergency and how each would vere crisis indeed, going toward cutbacks of October 21, 1974 525 : 30 or 40 percent of available oil, then there oil votes weighted on consumption count for is a strong commitment in the agreement to 100 with the remainder allocated three per take all necessary further restrictions in de- country. mand and other actions to assure the security This voting system is complex in its exe- of the group. cution but relatively simple in its concept, So, this is a process which at the outset and the idea is that there should be a very contains a series of very specific commit- strong presumption that this machinery ments for the kind of crisis that we had to comes into effect in a crisis. face this past winter and a further general Another aspect of that voting machinery commitment for more serious crises should is that it also can be used for all of the or- they develop. dinary business of the group, so that the Thirdly, there is a formula for sharing oil ability of the group to interpret its under- which is constructed as a function of the first takings, to act on what it thinks its basic two commitments in stockpiling and in con- agreement means—and this is a carefully sumption cutbacks. What it does is basically written agreement which runs now to 82 ar- assure that available oil is sorted out as a ticles and is quite fully laid out—should also function of the first two commitments, so be very strong. that all countries use their oil stocks, their Now, thirdly, with regard to the contin- security provisions, in effect, at about the gency plan itself, there is provision for both same rate and no country will run out of oil protection against a general embargo affect- sooner than any other. ing the group as a whole and for protection To express this basic contingency plan, the against a selective embargo, which might 12 countries have tentatively agreed that they target one or two countries, as the United should have a new institution which would be States and Holland were targeted last win- an international energy agency, an autono- ter. This pi'ovision also creates a strong pre- mous institution to be constructed within the sumption of action, once the shortfall is iden- framework of the OECD [Organization for tified. This, too, could be overturned, but only Economic Cooperation and Development], by a very strong majority vote. In this case, minis- having its own governing council at it would require 10 countries. level and its own secretariat. terial I should note that because of the structure agreed on a series of decision- They have of the American oil market, with most of the which are important and making provisions imports coming into the east coast—and this represent a significant innovation in inter- is also true of Canada—there is a separate provide, in national decisionmaking. They provision that this selective trigger can be an oil contin- the case of action to overcome used in regard to a regional market of a of action. gency, a very strong presumption given country, as well as to the national is to say, once a given shortfall of oil That market. So there is, in effect, built-in protec- a is identified, this shortfall would create tion for the east coast of the United States trigger the presumption—in effect would and the east coast of Canada. commitments to demand restraint and to Now, this contingency plan is the heart of sharing, unless a very strong majority of the international energy program which has the countries in the group were to vote to been agreed at this stage, but does not ex- overturn it. That strong majority must be haust it and is regarded as a first stage. expressed in terms of both a large number The plan now contains the following other of the countries involved and countries rep- elements resenting a large majority of the oil con- sumption of the group. It would take, in ef- —One, a broad program of cooperative re- fect, 60 percent of the weighted votes, and search and development which is to be guided the weighting is calculated in such a manner by the new energy agency and undertaken that out of a total of 136 votes of the group, partly on the basis of national groupings 526 Department of State Bulletin with one individual member in the lead and expression by the consuming countries to partly on the basis of cooperative research to consider their destiny and their security as be done through the OECD itself by, if not energy consumers together.