Iranian Gas: Russian policy

09/10/2007 Alina POGHOSYAN

– The Iran-Armenia pipeline is already ready for use. Iran is ready to start supplying gas, however, Armenia has announced that it does not have any problems with energy resources. What is the reason of refusing the Iranian gas for some time? Is the reason the fact that we don’t have enough facilities to make energy from gas and we are waiting for the works of the Yerevan HES and the fifth bloc of the Hrazdan HES which will take minimum two years to be finished?

– Iran-Armenia gas pipeline has both economic and political meaning for us. From the political point it is an alternative for us, and from the economic point we should be able to create maximum competition between the two parties. The Russian Federation has fixed the price for 1000 cm in the region at $230, we should create competition here.

– If I am not mistaken we haven’t agreed upon the gas price with Iran.

– We will have to export electricity against the gas imported from Iran – 3kwt/h electricity against 1cm of gas. The more the gas price in the international market is growing, the more attractive the Iranian gas is becoming for Armenia. We can import gas from Iran and compensate it with electricity now too, we have the necessary potential. Besides that we will also have some profit in the form of gas. The problem concerns the energetic policy in the region. We should be able to build our relations with Iran in compliance with the responsibilities we have undertaken. If we have been excluded from certain programs in the region, the same cannot be said about the energetic field. The possibilities of exchange between Iran and Turkey are not so big than Iran has with Armenia. In order to transport energy through long distances they should keep the voltage parameters, and only we have such capability. We are capable to provide a transit line through Iran to Europe.

– In the middle of September we had to receive a delegation consisting of Iranian specialists for the purpose of discussing the issue of constructing another high voltage line from Iran to Armenia, which did not take place. What is the reason of such delay? Is it connected with the delay of opening the pipeline?

– We are in the phase of planning the construction of the second high voltage line. The problem is that there are many holidays in Iran. 270 days of 365 days are considered business days in Armenia, but in Iran the number of business days is 162, which is the reason why there are some changes in the scheduled program. A huge institution is involved in the planning works and the delegations are periodically visiting the countries. We have several energetic programs with Iran, which are in the normal process now. Works are being implemented to start the construction of the “Arax” HES with 140 mwt power, which will be possible to start next year. The issue of constructing an oil reproduction factory is being discussed in a trilateral format, where about $2-2.5 billion will be invested.

– Recently a group of companies, which had energetic debts, merged with “ArmgasArd” (“Armenergo”, the HES of Hrazdan, Arpa-Sevan Cascade). The debt of Armenergo totaled to $4 million and it is interesting whether the Georgian company has returned the debt of Armenergo or not. (Armenergo has authorized a Georgian private company to receive the debt of the electricity supplied to Georgia. The Georgian government has cleaned its accounts with that company, but this $4 million has not reached Armenia).

– A group of companies, which have lost their role and purpose in the field, have gathered in one place – this is the real purpose. The mentioned debt on the part of Georgia is still pending and we are trying to find a timeline for covering that debt. It is not an intergovernmental debt; Georgia has paid that money to that company, but the money has not reached the destination. We have submitted the problem to the ministry of energy of Georgia and told them that the mentioned mechanism hadn’t worked and that we hadn’t got that money. They don’t refuse the fact that they owe. The existing owner of that debt is “Armgasard”.

– The ministry of energy is representing the interests of the government with 10% share in Nairit factory. “Rainoville Property limited” has pledged its share in the factory for 70 million in order to buy “Nairit”. Armenia has not received 30 million out of that sum yet. The Rainoville can pledge its shares in order not to establish extra debts in the factory if those shares are worthy, can’t it?

– Any company has the right to pledge its property and borrow money for the purpose of buying or for other purposes. Before buying the company has to present some warranties, in a word pledging is a common thing in the international market.

– Notwithstanding, in order to pledge it has to buy it first.

– It is their problem what to buy and what to pledge. We should count our own money, but not that of the others. Does this company have any debts of electricity, salary, water? It doesn’t have any debts now.

– If Nairit does not have internal debts, it has new credit obligations. These debts were not covered on the expense of the incomes, but due to a credit worth of 40 million. At present the debt of the company exceeds 100 million.

– Nairit does not have debts; it is the debt of Rainoville since the transactions were done by this company. If they have other businesses and are using that money for other purposes it is their business. They have pledged the shares of Nairit, but not the property. They cannot pledge the property of the factory without our permission. It is not easy to operate that factory since the facilities are depreciated and old. It is very easy to speak about it. We have succeeded and brought the factory to a situation, when it can work stably. The products of Nairit were not demanded in the market before, now it has established a market for its products. Nairit has found its place in the market. Currently the “Chemprom” of Vanadzor city is faced with the same situation, which used to produce the best carbide in the region. In order to enter the market they have to produce high quality products now.
 
– The price of caoutchouc in the international market is about $5.000, indeed the agents pay 2300-2500 dollars to buy caoutchouc from the factory.

– The caoutchouc we produce does not have such price in the market. The domestic production is estimated at $3000-3300. Do you think our product is as expensive as that of the leading companies of the international market?

– The government has constituted terms and minimum limits for investments in the sales agreement of Nairit. By the end of the year they have to invest $60 million and re-start the production of butadiene caoutchouc by increasing the production capacities by three times (from 800 tonnes to 2.5 thousand tones a month). It is clear that the schedule they have agreed upon has been breached. What is the government going to do?

– Rainoville has to invest 120 million during five years. If they don’t operate the butadiene technology before the gas price appreciation, they will have huge losses. Nairit can also produce acetylene caoutchouc from carbide, which is the main priority of the factory. During our recent discussions the owners of the company said that they wanted to develop both of the lines of caoutchouc production.

– The head of the board of directors of Nairit, Vahan Melkonyan has informed the personnel of the factory that he was leaving for Russia as he had got an offer for another job. There are rumors that the owners of the factory want to sell Rainoville to Chinese investors.

– I don’t know about it. Chinese people are visiting Nairit for training purposes. They might have seen these Chinese people and thought that they were buyers. As for Vahan Melkonyan, he was just a hired employee. He is not the owner of Rainoville.

– Who is the real owner?

– The owner is not the deputy head of the CIS intergovernmental bank Kulikov as you have written. There are three such companies.