Rosbalt,
Armenia and Iran have been doing
little together economically despite their geographic proximity. Aside from Georgia,
Iran is Armenia's only physical link to the rest of world, since Azerbaijan and Turkey both bar passage in and out. Yet Iranian-Armenian trade has steadily dropped in recent years. While
exports to Iran constituted 13%-15% of Armenia's foreign trade a few years ago,
Iranian imports made up only
3.5% of Armenia's total imports in 2003, with its exports to
Iran amounting to 5% of the national total.
This year, however, with emphasis
on the energy sector, economic relations between the two states
promises to climb to new
heights.
There was renewed talk in Armenia at the end of 2003 of the long-projected
Iranian-Armenian gas pipeline. Talks
have been going on for 10 years without ever getting very far. There are many
reasons for that. First, there's
the absence of financing for the
idea, which would chiefly benefit
Armenia. But then anyone ready to
invest more than USD 20 million a year in Iran faces the threat of sanctions
from the United States.
But with
Russia now showing interest in building the pipeline,
the situation has brightened. Talks have begun with
the government of Russia and the
management of Gazprom,
according to Armenian Prime Minister Andranik Margarian. Were investment to be divided, he noted, among
Armenian, Russian and Iranian companies,
the construction-with a price tag
of about USD 70-90 million-would not exceed the US limit. Karen Karapetian, who runs Armrosgazprom,
spoke of his company's interest in participating in the project, for
which he called 2004 the turning point. 'The gas pipeline
has strategic importance for Armenia. With
the country now entirely dependent
on a single gas pipeline running through Georgia, the new line becomes
a factor in Armenia's security,' Karapetian said. Gazprom, incidentally, owns 45% of the shares of Armrosgazprom.
The project would proceed in three phases. The
first would involve laying the pipeline from
Iran and connecting it to the existing
Kadzharansk gas pipeline within Armenia. The second
phase would take the line
from Kadzharansk to Goris or
Sisan. The third stage would
involve linking it to the Vaiots
Dzorsk regional system. Upon completion,
the line would have a capacity
of up to 1 billion cubic meters
of gas a year, approximately the amount of gas that
Gazprom and Itera now supply to Armenia
(currently, 1.27 million cubic meters of gas a year).
Another even larger project is in the works. Armenia
and Iran are considering joint construction of a hydroelectric power station on the Arax River,
which runs between the two
countries. According to Mohammad Farkhad
Koleiny, Iran's ambassador to Armenia,
construction of the station is expected to cost USD 155-160 million. Topographic and other preparatory
work is underway, he said. He
also said Armenia had asked Iran to assume the
cost of the Armenian part of the project in exchange for future
profits from the station. He
noted, too, that Russian companies
have expressed interest in participating in the construction of the station.
The project
has great importance for Armenia in that it would make
it possible to supply Armenia's south with power
in significant quantities. Indications are that this would
make it possible to run full-scale aluminum and copper plants,
enormous users of energy, near their
respective mineral sources.
This would also be a plus for Rusal, which has purchased the Armenia foil-rolling Armenal and that would
then be able to use local
raw material.
Armenia and Iran also say that they
are developing joint projects for the use
of wind and other alternative sources of electricity production. Finally, during his visit to Armenia, Anatoly
Chubais declared that his United Energy Systems of Russia was making every effort
to improve exports of Armenian electricity to Iran. In view of all
this, it is clear that 2004 shapes up as the year
of the Russia-Armenia-Iran energy axis.
Samvel Martirosian,
Rosbalt.
Translated by Howard Goldfinger.