Necessity Mother Of Invention In Gas-Fuelled Armenia

NECESSITY MOTHER OF INVENTION IN GAS-FUELLED ARMENIA
By Hasmik Mkrtchian

Reuters, UK
Aug. 16, 2006

YEREVAN (Reuters) – Ex-Soviet state Armenia is blazing a trail in
the global quest to move to cleaner fuels — not by choice but out
of necessity.

The tiny country of 3 million people in the Caucasus mountains has
a strong claim to be a world leader in running vehicles on natural
gas: a fuel that produces fewer harmful greenhouse gases than petrol
or diesel.

The transport ministry estimates that between 20 and 30 percent of
vehicles in Armenia run on gas. That compares to just over 3 percent
in the Netherlands, a front-runner in gas-powered transport, according
to the World LP Gas Association.

Stop one of the creaking, Russian-made taxis plying their trade in
Armenia’s capital, Yerevan, and odds are it will have a gas canister
strapped into the boot. Battered buses have rows of red canisters
fastened onto their roof-racks.

In countries like the Netherlands, switching from petrol to gas is
seen as a green option.

In landlocked Armenia, it is not concerns over climate change or
global warming that are driving growth in gas-powered vehicles.

Instead, it is harsh necessity — and an unresolved war with
Azerbaijan, its neighbor to the east.

"In our taxi firm, we have 30 cars and all of them run on gas," said
45-year-old Seryozha Harutunian, driver of a gas-powered Volga sedan.

"And there are gas refueling stations on every corner in Yerevan,"
he said.

Richer countries offer tax incentives to make gas for use in vehicles
— known as autogas — more attractive to motorists than traditional
fuels. But they have had only limited success.

"They are niche markets," said Yvon Sellier, director of business
practices with the World LP Gas Association, a Geneva-based lobby
group. "(Gas is a) small proportion of the fuel consumed by vehicles."

NECESSITY MOTHER OF INVENTION

Crude oil and oil products used to be brought into Armenia by
rail direct from Azerbaijan’s oil fields and refineries. Since a
territorial conflict between the two neighbors in the early 1990s,
the border has been closed.

Now, oil and oil products — Armenian officials do not say where they
come from — have to be shipped in through Armenia’s other neighbor
Georgia, a long and tortuous journey through the Caucasus mountains.

That creates an extra cost on top of the already high price for fuel
on world markets.

In Georgia, a liter of the cheapest grade petrol costs consumers 82
U.S. cents. In Armenia, the same fuel costs 91 cents — a significant
difference in a country where the average monthly wage is about $140.

Natural gas, meanwhile, is pumped to Armenia by pipeline from Russia.

Russian gas monopoly Gazprom supplies the fuel at $110 per thousand
cubic meters, a hefty discount on the price Gazprom customers in
Europe pay. Armenia is one of several ex-Soviet states that enjoy
favorable rates for Russian gas.

"Petrol is getting more expensive," said Transport and Communications
Minister Andranik Manukian. "Gas … has not gone up by that much so
it is preferable to use it."