Armenia Says Its Gas Price Stays Fixed
BusinessWeek
Nov 4 2006
All Associated Press News
YEREVAN (AP) – Armenia said Saturday that the price it is paying for
Russian gas of US$110 (euro86) will stay fixed until the end of 2008,
an announcement certain to rile neighboring Georgia which has been
told to pay more than double that from next year.
Armenian Finance and Economy Minister Vardan Khachatrian said that
Russia’s Gazprom state monopoly had agreed to freeze the price
until Jan. 1, 2009, in return for Armenia transferring control
of an electricity power generating unit for almost US$250 million
(euro197 million).
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also said that Yerevan was in talks with OAO Gazprom over the sale of
ownership rights to the Armenian segment of a planned pipeline bringing
Iranian gas to the country, which is due to open later this year.
Gazprom this week said it plans to charge Tbilisi US$230 (euro180)
per 1,000 cubic meters of gas, compared with the US$110 that it
pays now, ratcheting up economic pressure against Moscow’s small,
pro-Western southern neighbor.
Georgian Prime Minister Zurab Nogaideli said that the sharp price
rise was obviously political because other ex-Soviet nations were
paying far less.
On Saturday, Nogaideli said that Georgia would not agree to pay such
a high rate because it was not commercially justified. "We are not
going to pay an non-market price," he said.
Energy Minister Nika Gilauri said Friday that talks were taking place
with Azerbaijan, Iran and Turkey to secure alternative supplies of
gas. Analysts in Georgia warned of a repeat of the gas war between
Russia and Ukraine at the start of this year when Gazprom cut off
supplies.
That stoppage, amid fierce negotiations over a higher price
demanded by Gazprom, was seen as punishment for Ukraine’s pro-Western
policies. Ukraine, which finally agreed to pay almost double at US$95
per 1,000 cubic meters, has since managed to limit the increase for
2007 to US$130 after Russian-leaning Prime Minister Viktor Yanukovych
took over as head of government in the wake of his party’s success
in March polls.
Neighboring Belarus faces a fourfold rise in gas prices to US$200,
although Gazprom is believed to be willing to compromise if the
country hands over 50 percent of the state pipeline through which
Russian gas transits to western Europe.