Agency WPS
The Russian Oil and Gas Report (Russia)
April 23, 2004, Friday

YEREVAN NEGOTIATES WITH TEHRAN ON CONSTRUCTION OF THE IRAN-ARMENIA
GAS PIPELINE FOR MEETING OF DOMESTIC NEEDS

Armenian President Robert Kocharyan reports that Yerevan is
negotiating with Tehran on construction of the Iran-Armenia gas
pipeline for meeting of domestic needs. The President stresses, “We
are discussing the project only in the framework of strengthening of
the energy security of Armenia.” He adds that construction of the
second power transmission line continues and this line will not only
allow Armenia to increase the flow of electric energy but also to
exchange electric energy for Iranian gas. Signing of the final
agreement on construction of the Iran-Armenia gas pipeline is
expected in late May during the visit of Iranian Oil Minister Bijan
Zanganeh to Yerevan.

The project is estimated at $120 million. It is planned that at the
first stage Armenia will receive 700 million cubic meters of gas a
year through the new pipeline with further increase of supplies to
1.5 billion cubic meters. Armenia is going to pay for gas with
supplies of electric energy (3 kilowatt-hours for 1 cubic meter of
gas). Meanwhile, at the beginning of February Boris Aleshin, who was
Deputy Prime Minister of Russian government then, spoke on his visit
to Yerevan about Russia’s interest in construction of the
Iran-Armenia gas pipeline. According to Aleshin, in the future
Gazprom may become operator of a part of the pipeline that is to be
built in the territory of Armenia. Turkmenistan, Ukraine, the
European Union and China also demonstrate their interest in the
project.

Source: Vremya Novostey, April 22, 2004