TV Looks At Background To Russian-Armenian Energy Talks

TV LOOKS AT BACKGROUND TO RUSSIAN-ARMENIAN ENERGY TALKS

RBK TV, Moscow,
30 Oct 06

"Gazprom will get everything it asked for in Armenia. Armenian
President Robert Kocharyan today assured Vladimir Putin that the
Russian holding company would remain a monopolist in the republic. It
has no competitors," Russia’s RBK TV said on 30 October, following
reports of talks between the Russian and Armenian president in Moscow.

"Vladimir Putin, who most likely was quite well aware of what his
Armenian colleague was about to announce, immediately hinted: Russia
is ready to seriously increase investments in the republic," the
presenter on the channel’s "Intrigue of the Day" evening round-up said.

Kocharyan will have made his trip to Moscow, RBK TV said, to discuss
the future of the Iran-Armenian gas pipeline. The 140-km gas pipeline,
which is to run from southern Armenia and join up with the gas pipeline
going through Georgia to Russia, is being built by the Armrosgazprom
Armenian-Russian enterprise. Gazprom and Armenia’s Energy Ministry have
45 per cent of shares each in this enterprise, and another 10 per cent
belongs to the Iter international group. "In April, after the turbulent
gas wars, Gazprom agreed to sell gas to Armenia at a fixed price for
another three years. In exchange, it demanded an extra emission of
Armrosgazprom shares. As a result, the Russian holding in the joint
enterprise was to increase substantially. Gazprom was thus to get
almost complete control on the Iran-Armenia gas pipeline," RBK TV said.

"The opposition in Yerevan sees this as a transit pipeline, passing
not only from Armenia to Russia but from Iran to Europe, bypassing
Russia. For obvious reasons, Gazprom takes a dim view of this variant,
since with the right to a veto, it will be able to control the gas
network in the region," the presenter went on.

Interviewed on the programme, investment company analyst Dmitriy
Mangilev said that Gazprom needed control over supplies of gas from
Iran in order to preserve its monopoly over gas supplies to Ukraine.

"Otherwise, Iranian gas could be sent through an upgraded gas pipeline
to Ukraine. From the political point of view, supplies of gas to
Armenia from Iran will make it possible to control supplies of gas
to Georgia from Russia. Because otherwise, gas supplies to Armenia
could only be made transiting through Georgia."

This, the presenter said, would mean Gazprom could "as a minimum,
influence the cost of pumping and the final price of Iranian gas for
Europe, and as a maximum, control all the energy movements in the
Caucasus and the European Union".

"The topic of gas as a method of exerting influence in the Caucasus,
analysts suggest, was a central one in the Kocharyan-Putin talks,
even thought the official reason for the visit was the end of the
Year of Armenia in Russia. But analysts reckon that behind closed
doors there will be discussion of how as soon as construction of
the gas pipeline is completed, Russia will calmly be able to close
off the valve to Georgia. Something may have to change in relations
between Tbilisi and Moscow very fast and very radically, for not for
nothing did Robert Kocharyan first of all assure Putin that Gazprom
would get what it had been promised," the presenter said.

Tehran, the presenter commented, needs sales markets, and will be
looking to the gas pipeline as a transit pipeline to sell gas to
Europe. Gazprom currently supplies Armenia with as much gas as it
needs, so Armenia will be able to sell Iranian gas. "But if Iranian
gas does in fact go to Europe, it will be only under supervision,
and if it brings Russia not losses but profits; and what is more,
the money aspect is the least important thing."

The programme then carried a clip showing the chairman of the
Duma committee for energy, transport and communications, Valeriy
Yazev, calling for Russia to lead an alliance of regional gas
producers. "We need to set up a gas alliance. Its format can be more
or less determined – at least Turkmenistan, Kazakhstan, Uzbekistan,
Russia, Ukraine, Belarus. And tomorrow – I’m speaking figuratively,
in brackets, here, if the problem of Iran’s nuclear programme is
removed – I see Iran in this alliance. Then this is more than 50 per
cent of the world’s gas, and of course, Russia and Gazprom should
emerge as the integrator of this gas alliance."

Proposals like these "have not gone down well in Europe recently",
the RBK TV presenter said. "European officials are openly accusing
the Kremlin of energy blackmail. The EU sees Moscow as demanding
Russian companies be allowed into the markets of the Old World,
otherwise it threatens to start sending supplies to other markets".

The Kremlin denies this, "though it also makes it clear that it does
not like everything in European policy". RBK TV said.