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The Messenger, Georgia
March 26 2007
A gas powered ski trip
President Saakashvili went skiing recently, not in his beloved
Gudauri, but in the Armenian resort of Tsakhkadzor. His partner on
the slopes was his Armenian counterpart Robert Kocharian. There is
nothing especially unusual in this, the president is a keen skier,
and what better place to maintain the generally excellent bilateral
relations Georgia and Armenia enjoy than on the piste. But a few
things about this visit were a mite unusual, firstly it was
relatively impromptu. There was none of the normal, weeks in advance,
'the sides will discuss' flurry of press releases that usually
precede such visits, rather, it was a "brief, private, friendly
visit", said the Foreign Ministry.
While it went largely unreported in Georgia, the Armenian press felt
there might be reasons deeper than an afternoon's skiing, and
concluded that the real purpose of the visit was to talk about gas.
A gas pipeline connecting Armenia-which has no reserves of its
own-and Iran has just been inaugurated. The pipeline, built and owned
by Russia's state owned gas monopoly Gazprom, will see Armenia having
two sources of gas for the first time in the small nation's history.
But that in itself could prove a threat to Georgia, whose well
publicised gas woes could get worse.
The pipeline itself is a little on the thin side-its diameter is
significantly less than originally planned. Why? At its current
diameter its capacity will not be enough to transit gas to third
countries (namely Georgia), and thus the gas in it will not compete
with the Gazprom gas that Russia sells Georgia.
But why worry? According to Georgian Energy Minister Nika Gilauri
Georgia is no longer dependent on Russian gas. Well, not as dependent
as it used to be for sure, but more than half of the country's gas is
still Russian, and though the blossom is out the nights are still
cold. Georgia needs that Russian gas. Before the Iran-Armenia
pipeline was built, Armenia depended on Russian gas that crossed
Georgia, so Russia couldn't simply turn the tap off without hurting
its strategic, long suffering ally Armenia (mysterious explosions not
withstanding). But with the new pipeline, Russia can happily stop
deliveries to Georgia without leaving Armenia out in the cold.
This has not gone unnoticed in the Armenian press, which speculates
that the real purpose of Saakashvili's "brief, private, friendly"
visit was to strike a deal so that Armenia will delay the launch of
gas deliveries until well into the spring.
But some experts wonder whether Gazprom would bother building a small
diameter pipeline way down in Iran just to be able to put the squeeze
on Georgia. Might there not be some grander strategy, they wonder.
Gazprom has long perfected the art of buying cheap, non Russian gas
to sell to its domestic consumers, and then sell its own, more
expensive Russian gas to its customers in Europe. Iran, where gas is
plentiful but export something of a problem, could well fit into this
master plan. After all, pipelines can be expanded. Taking this into
account, and given that Gazprom already owns all of Armenia's
pipelines, the only missing piece in the puzzle is the pipeline
running from the Armenian border across Georgia to Russia. No wonder
the Russians were so hopping mad when Georgia wouldn't sell it to
them...
March 26 2007
A gas powered ski trip
President Saakashvili went skiing recently, not in his beloved
Gudauri, but in the Armenian resort of Tsakhkadzor. His partner on
the slopes was his Armenian counterpart Robert Kocharian. There is
nothing especially unusual in this, the president is a keen skier,
and what better place to maintain the generally excellent bilateral
relations Georgia and Armenia enjoy than on the piste. But a few
things about this visit were a mite unusual, firstly it was
relatively impromptu. There was none of the normal, weeks in advance,
'the sides will discuss' flurry of press releases that usually
precede such visits, rather, it was a "brief, private, friendly
visit", said the Foreign Ministry.
While it went largely unreported in Georgia, the Armenian press felt
there might be reasons deeper than an afternoon's skiing, and
concluded that the real purpose of the visit was to talk about gas.
A gas pipeline connecting Armenia-which has no reserves of its
own-and Iran has just been inaugurated. The pipeline, built and owned
by Russia's state owned gas monopoly Gazprom, will see Armenia having
two sources of gas for the first time in the small nation's history.
But that in itself could prove a threat to Georgia, whose well
publicised gas woes could get worse.
The pipeline itself is a little on the thin side-its diameter is
significantly less than originally planned. Why? At its current
diameter its capacity will not be enough to transit gas to third
countries (namely Georgia), and thus the gas in it will not compete
with the Gazprom gas that Russia sells Georgia.
But why worry? According to Georgian Energy Minister Nika Gilauri
Georgia is no longer dependent on Russian gas. Well, not as dependent
as it used to be for sure, but more than half of the country's gas is
still Russian, and though the blossom is out the nights are still
cold. Georgia needs that Russian gas. Before the Iran-Armenia
pipeline was built, Armenia depended on Russian gas that crossed
Georgia, so Russia couldn't simply turn the tap off without hurting
its strategic, long suffering ally Armenia (mysterious explosions not
withstanding). But with the new pipeline, Russia can happily stop
deliveries to Georgia without leaving Armenia out in the cold.
This has not gone unnoticed in the Armenian press, which speculates
that the real purpose of Saakashvili's "brief, private, friendly"
visit was to strike a deal so that Armenia will delay the launch of
gas deliveries until well into the spring.
But some experts wonder whether Gazprom would bother building a small
diameter pipeline way down in Iran just to be able to put the squeeze
on Georgia. Might there not be some grander strategy, they wonder.
Gazprom has long perfected the art of buying cheap, non Russian gas
to sell to its domestic consumers, and then sell its own, more
expensive Russian gas to its customers in Europe. Iran, where gas is
plentiful but export something of a problem, could well fit into this
master plan. After all, pipelines can be expanded. Taking this into
account, and given that Gazprom already owns all of Armenia's
pipelines, the only missing piece in the puzzle is the pipeline
running from the Armenian border across Georgia to Russia. No wonder
the Russians were so hopping mad when Georgia wouldn't sell it to
them...