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Georgia aims to maintain 10% share of Gazprom natural gas transit

by | Mar 31, 2016
Anti-Gazprom Demonstration in Tbilisi March, 2016 (DFWatch)

Anti-Gazprom demonstration in Tbilisi in March, 2016. (DFWatch.)

TBILISI, DFWatch–Georgia has offered Gazprom to continue the transit of natural gas to Armenia. under the same conditions as before.

The details of the offers are not known, but the negotiations between the Georgian government and Gazprom will finish within days, Deputy Energy Minister Mariam Valishvili has said.

The Energy Ministry press office told DFWatch that Valishvili would not comment on any additional details apart from what she said on Wednesday.

Georgia no longer needs additional import of natural gas from Russia after signing a contract with Azerbaijan’s Socar, but negotiations continue about conditions of transit of gas to Armenia through Georgia.

This means that Georgia aims to maintain its 10 percent share of the natural gas transferred to Armenia, which amounts to 200 million cubic meters of gas per year. Gazprom wants to pay money instead of providing natural gas to Georgia.

Since the second half of 2015, the Georgian government has spoken of the need for additional gas supply due to increased consumption and was in negotiations with Gazprom about meeting that demand.

However, on March 4, Georgia and Azerbaijan’s Socar signed agreement about Socar providing additional 500 million cubic meters of gas and the Energy Minister Kakhi Kaladze said that Georgia would no longer need to purchase additional gas from Russia.

According to the agreement signed on March 4, a memorandum between Georgia and Socar signed in December 2011 was amended. The memorandum is in force until 2030. The amendment means that the price of commercial gas for the gas stations is reduced by USD 35/USD 40 for 1,000 cubic meters, but it is unknown what the price for the commercial sector was before the amendment.

A letter sent by the Energy Ministry to the Republican Party in 2015 says the contract is a commercial secret, but the ministry also informed that the private sector is purchasing gas from Socar for the price of EUR 260 per 1,000 cubic meters.

The Energy Ministry provided DFWatch data about consumption of gas in Georgia, which shows the annual consumption and what amount of gas Georgia receives from different countries.

Read the Energy Ministry report here.



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