Selling government shares in Armrosgasprom will rule out further gas price rise in next 5 years, ruling party says

YEREVAN, June 24. /ARKA/. Selling 20% government shares in ArmRosgasprom will allow avoiding further gas price rises in the next five years, head of Republican Party of Armenia parliament faction Galust Sahakyan told reporters Monday. 

 

On June 17, the chair of Gazprom directors board Aleksey Miller and Armenian energy minister Armen Movsisyan discussed a number of cooperation issues, including possible increase of Gasprom’s shares in ArmRosgasprom from 80% to 100%. The sides discussed also Russian gas pricing for Armenian consumers.

“The negotiations are still underway, but as far as I know, it (selling Armenia’s shares) will allow making the gas prices not change in the next five years”, Sahakyan said.

Under a decision of Armenia’s public services regulatory commission, the tariff for gas for customers consuming up to 10,000 cubic meters will increase from 132,000 drams to 156,000 drams (including VAT) as from July 7.

Sahakyan also said profits from 20% shares held by Armenia have been fully invested in the service level improvement, which means that Gazprom has nothing out of the deal and the government is not losing.

In speaking about strategic importance of Armenia’s shares in ArmRosgasprom, Sahakyan said Armenia has the right to reject Russian gas supplies any time.

The head of the faction said wages will be increased in Armenia as from January 1, 2014. He also said some 60,000-70,000 socially vulnerable families will continue receiving gas supply at the same prices as now.

According to Armenian mass media, the authorized stock of ArmRosgasprom was 312 billion drams as of the end of 2011; Armenian government’s share was 6.24bln drams or about $150 million (equal to what is requested for 30% gas subsidies).

On May 16, Armenian premier Tigran Sargsyan said the government will subsidize 30% of the gas costs in case of a gas price rise. Later, Armenian minister of energy Armen Movsisyan said the government is trying to get the Russian side involved in the negotiations as Gazprom holds 80% of ArmRosgasprom (the remaining 20% is with the government).

ArmRosgasprom closed joint stock company holds the monopoly of Russian gas supply and distribution on Armenia’s domestic market. ($1=411.28drams).–0--