Georgia & Gazprom Make New Deal
Georgia and Russian energy company Gazprom have reached a new agreement, which means that Georgia, which serves as a transit country for the transportation of Russian gas to Armenia, will from 2018 receive payment from Gazprom.
Russia has been paying Georgia for gas transportation by supplying natural gas to the amount of 10% of the volume of transported gas.
The details were agreed on January 10 in the Belarusian capital of Minsk at a regular meeting of the General Director of Gazprom Export, Elena Burmistrova and Georgia’s Energy Minister, Kakha Kaladze.
The new agreement is a two-year deal. The previous arrangement will remain in place throughout 2017, after which the new payment system will come into effect.
The new agreement comes following the expiry of the previous deal on December 31, 2016.
At the press-conference, Kaladze explained that the new agreement does not mean that Georgia is becoming more dependent on Russian energy.
“Georgia’s dependence on Russian energy resources will not increase. Only the payment conditions have been changed. And it will be one of the highest transit fees among European countries,” he stated.
The Minister added that if Georgia needs additional gas supply in winter, it would be received at a reduced price of $185 instead of $215 per 1000 m3.
Burmistrova said the new deal was profitable for both sides.
"Gazprom Export has made a package of proposals to Georgia under optimal and mutually beneficial conditions, which will allow the Georgian party to increase guaranteed income from transportation services and improve the reliability of gas supply in Georgia," Burmistrova said.
Georgia’s key opposition party- the United National Movement (UNM) disapproves of the new deal, saying it shows that Georgia’s government is under the influence of Russia.
“The decision of the government is a betrayal,” said UNM member, Roman Gotsiridze. “I see personal interests here… Russia’s next target will be the Tbilisi gas distribution system, after this- the railway. This is a creeping economic annexation”.
Expert Soso Tsiskarishvili believes the Georgian side should have kept the conditions of the previous deal, which, according to him, were more profitable for Georgia.
“The Government's decision is, of course, a capitulation. Kaladze will have to explain what happened, why the government decided to give up,” he said.
The Georgian government has had many rounds of negotiations with Gazprom about the issue. However, until now, Kaladze always said the monetary payment offered by Gazprom was unfavorable for Georgia.
Georgia’s Finance Minister, Dimitry Kumsishvili, said the government had done its utmost to secure the best deal in the existing conditions.
He emphasized that, “Georgia is maintaining its energy independence”.
“Moreover, Azerbaijan remains Georgia’s strategic partner and top gas supplier. This is the most important part of the new deal,” the Minister claimed.
Thea Morrison