Tehran, Yerevan Reach New Gas Deal

Iran’s oil minister has announced an agreement between Iran and Armenia that Iranian gas will be transferred to Georgia through Armenia.(Source: ArmRadio)

TEHRAN (Mehr News Agency) —Iran’s oil minister, Bijan Zanganeh, has announced that on the basis of a new agreement between Tehran and Yerevan, Iranian gas will be transferred to Georgia through Armenia.

Zanganeh said transit of Iranian gas via Armenia marked the main axis of the session, speaking to reporters on the sidelines of a meeting with the visiting Armenian Ministry of Energy and Natural Resources Levon Yolyan.

“Following Iran’s appeal for gas transit to Georgia, the Armenian side suggested formation of a new organization which we confirmed,” stated Zanganeh adding “the new organization will replace Yerevan Thermal Power Plant as the current buyers of Iran’s gas in the Caucasus region country.”

The official went on to highlight that new contracts for direct sales of gas to Armenia as well as for gas transit to Georgia will be carried out by the new organization.

“Yerevan Thermal Power Plant does not possess necessary permits for gas transit,” stressed Zanganeh, outlining the possibility for transferring gas to other countries via Armenia as one advantage of establishing a new firm.

He reported on the signing of a small deal with a Georgian buyer for gas sales estimating that the agreement will become operational in the current year.

Zanganeh, while pointing to the recent request posed by Armenia for increased purchase of gas from Iran due to a problem with the gas pipeline from Russia, said “at the order of Iran’s First Vice-President Es’haq Jahangiri, as well as the Armenian Prime Minister, Hovik Abrahamyan, gas delivery to the neighboring country was risen from 1 to 3.5 million cubic meters.”

“The Russian pipeline will be brought back to operation in 40 days and Iran’s increased gas sales to the neighboring country was on the basis of a contract,” the official continued.

Zanganeh said Iran pursues the policy of strengthening energy ties with neighbors, especially in the areas of gas exports. “While not being a large consumer, Armenia marks an important route for exports of Iranian gas,” he said.

“Armenia has also made a proposal to increase gas purchase from Iran which comes to affect in late 2018 when the export volume will increase from the current 1 million cubic meters per day to 3,” said Zanganeh.

He further reiterated that “in exchange for each cubic meter of gas, Iran received three kilowatt hours of electricity from Armenia at the border while the figure has now climbed to 3.2 kWh.”