Armenia pays the lowest price for Russian gas - president

Armenia pays the lowest price for Russian gas - president

YEREVAN, March 28. / ARKA /. Russia sells natural gas to Armenia at $189 per one thousand cubic meters, the lowest export price, set by Moscow, President Serzh Sargsyan said today during a meeting with senior officials of the energy and natural resources ministry.

He said this price is fixed in a five-year agreement with Russian Gazprom and may rise maximum by 5 percent because it is correlated with domestic gas price in Russia.

Sargsyan said not only Armenian citizens but also foreign business people are aware of this price. According to him, some foreign business people are already considering possibilities for relocating their energy-intensive businesses to Armenia.

The president said there were already such examples. These business people believe that their products can be exported freely from Armenia to the Customs Union. 

“This, of course, is very good, but many of our country fellows can not understand why the gas costs $189 when it crosses into Armenia from Georgia and actually doubles when it reaches their homes. We need to explain to people how the gas price is formed for end users.  People need to know that we need to replace 30-40 year-old pipes, bring in up-to-date equipment, and so on. If we fail to explain all this we may face big problems,” he said.

President Sargsyan also expressed satisfaction at the establishment of an ad hoc parliamentary commission that will look into the government’s recent agreements with Russian Gazprom monopoly and gas supplies from Russia. 

"We have nothing to hide. Let the commission make an inquiry and present the results to the public.”  he said.

On January 6, 2014, Armenia’s government ceded its 20 percent stake in the national gas distribution company ArmRosGazprom (ARG) to Russian Gazprom for $156 million to repay half of the $300 million debt. Another half of the debt was written off by the Russian monopoly.

Under an agreement with the Armenian government, Gazprom is to deliver to Armenia 2.5 billion cubic meters of gas annually.  

ArmRosGazprom was established in December 1997. It dealt with transportation, storage, distribution and sale of natural gas in Armenia.  On February 25 ArmRosGzprom was officially renamed Gazprom Armenia. -0-

19:31 28.03.2014

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