ARMENIA, TURKEY NEGOTIATING POWER SUPPLY VOLUME

/ARKA/
May 21, 2009
YEREVAN

Armenia and Turkey are negotiating an increase in the volume of
expected power supply to Turkey from Armenia. RA Minister of Energy and
Natural Resources Armen Movsisyan reported that Armenia was to start
supplying electric power to Turkey this spring. A relevant agreement
was signed on September 4, 2008, by the RA Ministry of Energy and
Natural Resources, High-Voltage Networks Company and UNIT Company
(Belgium), which imports and distributes high-voltage power in Turkey.

The Minister said that Armenia continues the work to ensure the supply
of electric power to Turkey, resolving technical problems. He expressed
the confidence that Armenia will soon start supplying power to Turkey
because active work is in progress.

The Turkish side has made serious investments in the project to meet
technical requirements and purchased capital equipment, which proves
its intention to guarantee power supply, Movsisyan said.

The Minister said that the Turkish side is unlikely to cancel the
agreement. He pointed out that "all the trends have so far been
positive".

Without citing any figures, Movsisyan pointed out that they will
exceed the ones indicated in the tentative agreement.

As regards the construction of a nuclear-power station in Turkey,
Movsisyan believes that it will not cause any changes in that
country’s plans to import electric power f rom Armenia because
that is a long-term project, and the new station is not supposed
to satisfy the energy needs of Turkey’s developing economy. Under a
tentative agreement, Armenia is to start supplying 1.5bln kwh a year
to Turkey and bring the volume of supply up to 3.5bln kwh during the
following years.

The initially set price was US $57 for 1MW, but the final price will
be adjusted to the recent changes in the gas prices and finally set
terms of supply.