THE Iranian president Mahmoud Ahmadinejad and his Armenian counterpart recently inaugurated the gas pipeline that will reduce energy-starved Armenia’s reliance on Russian gas. Mr Ahmadinejad and Armenian president Robert Kocharian formally opened the pipeline in the Armenian town of Agarak, near the border with Iran. “This is a historic event that opens a new period in the relations of Iran and Armenia,” Mr Kocharian said at the ceremony.
Surrounded by local villagers, the two presidents lit a symbolic torch at the ceremony, which was delayed for hours after heavy fog prevented Mr Ahmadinejad's helicopter from flying to the area. He eventually arrived by car. "Our relations have deepened over the last 15 years and it is my intention to develop them further," the Iranian president said during the ceremony. He said he hoped to increase cross-border cooperation in a range of fields, including electricity, energy, water and telecomms.
Under a 20-year contract, Armenia is projected to receive 36bn cum of gas through the 150-km pipeline, reducing Gazprom's monopoly of the ex-Soviet country's gas market. Armenia is initially to receive up to 400m cum/yr of gas through the pipeline, but that amount is expected to eventually increase to 2.3bn cum/yr.
The agreement to build the $200-million pipeline was signed in 1992, but construction only began in 2004. Armenia funded its share of the pipeline with a $33-million loan from the Iranian Export and Development Bank, and will pay for the gas with electricity it produces at a Soviet-era nuclear power plant.
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