Russian control of Iran-Armenia pipeline not a certainty'

Armenia Materials 1 December 2006 12:02 (UTC +04:00)

(armenialiberty.org) - The widely anticipated handover to a Russian company of a pipeline that will supply Armenia with Iranian natural gas is not a forgone conclusion, Prime Minister Andranik Markarian claimed in a Russian newspaper interview published on Friday. He also reiterated Yerevan's hopes that Russia will defuse its festering confrontation with Georgia, reports Trend.

The construction of the pipeline is not yet complete, and it is still too early to speak of its transfer or non-transfer to any operator, including Gazprom, Markarian told the Moscow daily Kommersant, referring to the Russian state gas monopoly. He said the pipeline's first Armenian section will come on stream soon.

Gazprom makes no secret of its desire to control the pipeline which is supposed to reduce Armenia's strong dependence on Russia for energy resources. Last April the company confirmed but then refuted reports that it will get hold of the first 40-kilometer stretch of the facility as part of an agreement that allowed Armenia to temporarily avoid a hike in the price of Russian gas.

Armenian officials insist that the Russian giant will only get an incomplete thermal power plant in Hrazdan and a controlling stake in Armenia's national gas distributor, ArmRosGazprom (ARG), as a result of the deal. According to Energy Minister Armen Movsisian, the government will choose the owner of the under-construction pipeline next spring.

Still, Markarian himself strongly hinted on October 31 that the pipeline will be incorporated into ARG, 58 percent of which is now owned by Gazprom. It would be illogical to have two gas distribution networks in Armenia, he said.

The pipeline from Iran is taking on a greater significance in the light of the mounting Georgian-Russian tensions that increasingly threaten continued Russian gas supplies to Georgia. Armenia, which imports Russian gas through Georgian territory, might also be affected as a result.

We are interested in a quick resolution of the problematic aspects of Russian-Georgian relations because cooperation between Russia and Georgia is one of the most important components of stability in our region, Markarian told Kommersant.

The Armenian authorities signaled earlier their frustration with the continuing Russian transport blockade of Georgia which is hurting Armenian companies trading with Russia.