RUSSIA TO REDUCE GAS PRICE FOR ARMENIA

News.am
12:01 / 10/13/2009

Russia considering Armenia its strategic ally, is ready to aid in
overcoming the crisis by reducing prices for Russia-supplied gas. In
return, Moscow expects to gain the right for a new nuclear power
plant construction in Armenia. The project is estimated from 2 bln
Euro to U.S. $5 bln, Russian Kommersant daily reports, referring to
its sources.

The day before, Armenian and Russian Presidents canvassed bilateral
trade and economic cooperation, as well as the prospects of large
economic projects’ implementation. "Armenia suffering severe financial
difficulties have already got U.S. $500 m. loan from Moscow. According
to the sources close to &’Gazprom’, monopoly currently negotiates the
reduction of gas prices supplied to Yerevan. In 2010 it might decrease
from U.S. $200 to U.S. $180 per 1000 m³. However, this abatement is
conditioned not only by Russian side good intention, but also by the
gas price decrease for Europe next year compared to H1 2009. This
enables &’Gazprom’ to reconsider price policy for Russia’s close
partners among post-soviet states, that Kremlin reckons Armenia in,"
the daily reads.

Another topical matter of discussion is construction of a new nuclear
power plant instead of the Metsamor power plant that is almost worn
out. Tender for NPP prime contractor will be completed by the end of
2009. Russia reckons to have its AtomStroyExport CJSC to construct
NPP. "Agreement in principle on NPP construction is achieved and
we just have to proceed with the red-tape," one of the "Rosatom"
managers stated.

Presently the plant trust management is implemented by INTER RAO UES,
whereas control stock is held by Rosatom. According to the manager,
construction of new energy unit will total 2 bln. Euro in case power
capacity reaches 1000 MW. "It is a standard price. The cost equals
to the one we spend for the construction of NPP in Bulgaria and other
states," said "Rosatom" official.

Vice-President Alezande menian side stated earlier that construction
will cost U.S. $5 bln, however tender structure is yet unclear,"
he concluded.