RosBusinessConsulting Database
September 24, 2004 Friday 6:04 am, EST

Analysts on Gazprom’s strategy in Georgia

Gazprom could only be interested in acquiring gas distributing
companies in Georgia, analysts believe. Gas is delivered to Armenia
via Georgia, therefore, Gazprom may benefit from a stake in Georgian
gas distributing companies. Tbilgaz is Georgia’s largest gas
distributing asset and it contributes 20 percent of the overall gas
supplies to Georgia. And a fair price for it may amount to $20m.

Other experts believe that Gazprom may be interested in Georgian
pipelines. The Russian gas giant may be interested in strategic
cooperation with Georgia so that to ensure a lack of problems related
to gas supplies to Armenia and Turkey, they say. Gazprom may provide
necessary funds for the reconstruction of the existing Georgian
pipelines in exchange for control over transportation facilities and
lower transportation tariffs. Thus Gazprom may win control over
Georgian gas distributing facilities and prevent neighboring
Azerbaijan from entering the Turkish market.

In any case, Gazprom will benefit from stable relations with Georgia,
experts point out. Last year it had problems with payments for
supplied gas. But the situation has changed and the company is going
to improve relations with Georgia so as to boost gas supplies in the
future.