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Trump Crony’s Gas Deal Reignites Conflict-of-Interest Concerns

On the campaign trail a year before his election, Donald Trump boasted in a radio interview that his real estate holdings in Istanbul could influence U.S.-Turkish foreign policy as president.

(CN) — On the campaign trail a year before his election, Donald Trump boasted in a radio interview that his real estate holdings in Istanbul could influence U.S.-Turkish foreign policy as president.

“I have a little conflict of interest because I have a major, major building in Istanbul, and it’s a tremendously successful job,” Trump disclosed in a Dec. 1, 2015, interview alongside his future campaign chief, Steve Bannon. “It’s called Trump Towers. Two towers, instead of one. Not the usual one. It’s two.” 

Now as a second election cycle looms, Trump’s Turkish business partner on that Istanbul property is homing in on a liquefied natural gas deal that can dramatically boost the U.S.-Turkey energy trade for more than a decade.

“We envisage a 12 to 15 year agreement, starting with an initial phase of 2 to 3 years of spot market sales, to be followed by a 10 to 12 year agreement based on a transparent, commercially competitive pricing structure from LNG facilities in the U.S,” a letter describing the deal states.

According to the letter, the natural gas project is expected to have “strong support” from Trump and his Turkish counterpart Recep Tayyip Erdoğan, a man recently described by former Secretary of State John Bolton as one of the “dictators [the president] liked.”

The man at the center of the gas deal is Mehmet Ali Yalçındağ, the chairman of Turkey’s oldest state-sponsored trade group, who brought Trump’s real estate empire into Istanbul in 2012.

The son-in-law of Aydin Doğan, who owns Trump Towers Istanbul, Yalçındağ posed in 2012 with the future U.S. presidentand his daughter at that property’s ribbon cutting. Five years later, he attended Trump’s inauguration.

“Given the economic and policy underpinnings of the project, we believe that there will be strong support from the Trump administration, U.S. governmental agencies and Europe for the project,” Louisiana Natural Gas Export’s CEO Ben Blanchet wrote to Yalçındağ on June 10.

Based in the Bayou State but registered in Delaware, Louisiana Natural Gas Exports sprang into existence two years ago, when the company informed the Securities and Exchange Commission that it had received $17.5 million from two investors. That fell far short of their ambitions of a $75 million public offering, but the start-up’s ambitions could not be contained. Looking to the U.S. government, Turkish government and other sources of international support, the company now wants to break into the Trump administration’s plans to increase bilateral trade with Turkey to $100 billion a year.

“The details of the financing will be finalized as the project advances,” the letter states.

Blanchet, the company’s CEO, did not respond to an email seeking more information about those details. Two of his publicly disclosed letters do not specify the size of the contract or how much money the company seeks from U.S. and Turkish taxpayers.

“We expect strong support for the project from International Development Finance Corporation (DFC) and the Export-Import Bank of the United States EXIM on the U.S. side upon the direction of the White House,” Blanchet wrote.

The Trump administration pushed to resurrect Export-Import Bank last year.

"There are no applications for financing pending before EXIM from this company," a source from the bank said in an email.  

DFC did not respond to an email requesting comment by press time. Blanchet’s letter likens the natural-gas deal that his company is pursuing to a similar project in Mozambique, which the bank supported with a $5 billion direct loan last September.

The natural gas company disclosed its coordination with Turkish leaders in a second letter.

“We have carefully read President Erdoğan and Energy Minister [Fatih] Donmez's plans for growth and supply diversification in the sector,” the letter states. “It is clear that doing so will improve and strengthen Turkey's energy security and stability. We are confident that we can, and we will, contribute to the successful implementation of President Erdoğan's vision.”

Both letters became public on Monday under lobbying disclosures mandated by the Foreign Agents Registration Act, a World War II-era law designed to uncover state-sponsored influence campaigns on U.S. soil.

Dated June 10, the second letter refers to a memorandum of cooperation, which had not become public by press time.

The gas deal described in the letters followed Yalçındağ’s lobbying blitz last month on behalf of the Erdoğan-sponsored Turkey-U.S. Business Council.

In three separate letters, Yalçındağ pushed for increased U.S.-Turkish trade to three White House cabinet members, including Energy Secretary Dan Brouillette.

“Our members currently import nearly 1 million tons of Liquefied Natural Gas (LNG), making Turkey the second biggest LNG importer from the US in Europe and Central Asia, after Spain,” Yalçındağ wrote on May 10, referring to the Turkish companies comprising his trade group. “At this stage, we feel that we can now build on four years of progress and increase sales of LNG from the US to Turkey.”

Yalçındağ forwarded that letter to Trump, who reportedly called the Turkish businessman a “close friend” in a phone call with Erdoğan.

Louisiana Natural Gas Export’s letter advancing the proposed trade deal came a month later.

“TAIK’s long-standing mission has been to look for opportunities to increase trade between Turkey and the United States,” the trade group’s spokesperson said in an email, giving the Turkish acronym for the Turkey-U.S. Business Council. “This is a significant opportunity that also has the benefit of lessening Russia’s influence over the worldwide LNG market. We are proud of our cooperation with the United States and the transparency with which we pursue these integral trade opportunities.”

TAIK, which describes itself as independent and privately funded, operates under another trade group associated with the Turkish Ministry of Trade.

The firm representing for Yalçındağ’s Turkey-U.S. Business Council is Mercury Public Affairs, whose lobbyist Bryan Lanza served as Trump’s communications director on the presidential transition team.

Throughout his presidency, Trump’s cozy relationship with Erdoğan dogged his administration with scandal. His former national security adviser Michael Flynn admitted to secretly acting on the Turkish government’s payroll while he was a top official on Trump’s campaign and transition. Another member of Trump’s transition team, businessman Bijan Kian, was convicted by a federal jury on similar charges before a judge overturned the verdict.

After Trump precipitously withdrew from Syria following a phone call with Erdoğan last year, interest renewed in the president’s self-described conflict of interest. Various reports confirmed that Trump tried to stop the prosecution of Turkey’s state-run Halkbank, which was later charged with a record-breaking money laundering scheme to Iran. Bolton’s new book “The Room Where It Happened” corroborated reports that Trump interfered with the case as a favor to Erdoğan.

Oregon Senator Ron Wyden, the top Democrat on the Finance Committee, is investigating the Trump administration’s interference with that case and demanded more information from Bolton on the president’s favors to Turkey’s ruler.

The White House did not respond to a request for comment by press time.

Categories / Business, Energy, International, Politics

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