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TBILISI: Iran and Armenia begin building gas pipeline

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  • TBILISI: Iran and Armenia begin building gas pipeline

    The Messenger, Georgia
    Dec 31 2004

    Iran and Armenia begin building gas pipeline

    Russian newspaper Promishlenie Vedomosti reports that after more than
    10 years negotiations and agreements Armenia and Iran have begun work
    on a 141 km gas pipeline linking the two countries. The preliminary
    cost of the project totals USD 210-220 million.
    Starting from 2007, Armenia will receive 36 billion cubic meters of
    Iranian "blue fuel" over the following 20 years, and in return for
    this they will pay for it with their energy. According to experts,
    the Armenian-Iranian gas deal satisfies both countries.
    Armenia will have an alternative source of energy in two years and
    with this will increase its energy security. Having its own fuel and
    energy resources, Armenia receives the gas only from Russia, but as
    analysts note, the gas pipeline through Georgia is in a very bad
    technical condition and needs serious repair and modernization.
    Teheran, meanwhile, hopes that the implementation of the gas project
    will give it the possibility to play a stronger role in the South
    Caucasus. Iran has better political and economic relations with
    Armenia than with other Caucasus countries and hopes that the
    pipeline will be continued to Georgia.
    This would also give it the possibility of transporting gas via the
    pipeline to the Black Sea and Ukraine and from there to Europe,
    allowing it to become an important player in the European energy
    market. Needless to say, the Russian newspaper writes, Moscow sources
    say that the Russian administration is far from delighted at the
    prospect of a new competitor in the European market, where it
    effectively enjoys a monopoly position.
    President of Armenia Robert Kocharian was referring to Russia's
    monopoly when he stated recently that the transit of Iranian gas to
    Europe through Armenian is connected with "certain difficulties." The
    diameter of the Iranian-Armenian gas pipeline will be of such a size
    that it will be impossible to send a huge volume of "blue fuel" from
    Iran for further transportation to third countries.
    The inability to export vast quantities of Iranian gas has caused
    strong Moscow support for the project, with Deputy Chair of Gazprom
    Alexander Riazanov saying the gas giant will help construct the
    pipeline. "The technical-economic substantiation of the future gas
    pipeline Iran-Armenia is already ready," he says, and in Yerevan it
    is believes that Gazprom may finance the second stage of the project.
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