Armenia can't buy Iranian gas due to its high price

Armenia can't buy Iranian gas due to its high price

Armenia is not buying gas from Iran because of its high cost compared to Russian fuel, the Prime Minister of Armenia, Tigran Sargsyan, said.

"If we are able to supply cheaper gas from Iran, then, of course, we will go for it, but at the moment Iranian gas is more expensive than Russian, and here we have nothing to hide," the head of the government said in response to a question on the price increase of Russian gas.

In 2004, the Armenian government initiated construction of an Iran-Armenia gas pipeline to expand its gas import network. Armenia started receiving Iranian gas through the pipeline on May 15, 2009. Gas deliveries were agreed on the “Gas in exchange for electricity” principle, ARKA reports.

According to the Public Services Regulatory Commission, Armenia imported over 2.4 billion cubic meters of gas in 2012, of them over 1.9 billion were from Russia and 488.3 million from Iran. 

On May 14, Armenia-based ArmRosgazprom CJSC and Transgaz Ltd. requested Armenia’s Public Services Regulatory Commission to re-evaluate the current natural gas tariff. 

At present, the monthly tariff for consumers is 132 drams (including VAT) per 1,000 cubic meters for those who consume up to 10,000 cubic meters per month.

The request submitted by ArmRosgazprom states that the company, in accordance with the agreement with Gazprom, has been paying $270 per 1,000 cubic meters at the border since 1 April. The minister, however, says Armenia is and will be paying $180 until the talks over the tariffs are finished.