Azerbaijan Offers $500 Million for Georgia-Armenia Gas Pipeline

BAKU (Combined Sources)–Azerbaijan is ready to offer Georgia $500 million for a key oil and gas pipeline carrying Russian energy to Armenia through Georgia, Vugar Bayramov, the President of the Azerbaijani Center for Economic and Social Development (CESD) said on Tuesday, the AzeriReport.com blog reported.

The Georgian parliament paved the way for the sale in late June when it voted in the first reading to remove the so-called North-South pipeline from a list of strategic state facilities not subject to privatization, RFE/RL reported earlier last month.

The head of Azerbaijan’s state oil company (SOCAR), Rovnag Abdullaev, has meanwhile made no effort to hide his government’s intentions to buy all the oil and gas pipelines running through Georgia. But for the time being, Bayramov said he believes it is difficult to speak about an actual amount for the alleged North-South pipeline deal.

In 2006 Russia’s main gas exporter Gazprom offered $250 million for the pipeline, though Georgia asked $1 billion. According to Bayramov, Georgia wants to sell the pipeline at the highest price, but the $1 billion price is far more than the pipeline is really worth.

Azerbaijan has become Georgia’s principal gas supplier in recent years and analysts believe that SOCAR, which currently manages all of Georgia’s domestic gas-distribution network, could acquire the pipeline to block vital Russian gas deliveries to Armenia.

Georgian Prime Minister Nika Gilauri has, however, denied his government’s intention to sell the pipeline, saying that Tbilisi would only sell a minority share in the facility and will remain the principal owner.

Georgian Energy Minister Alexander Khetaguri similarly said last week that his government was not going to sell the pipeline.

The Armenian Government, for its part, said in July that it was not concerned about the possible purchase of the key supplying Russian natural gas to Armenia.

Armenian Energy and Natural Resources Minister Armen Movsisian insisted the Georgian government would not sell the pipeline to Azerbaijan or to private investors. He said Georgia was pursuing other objectives that do not threaten Armenia’s energy security.

“We have no concerns at the moment,” Movsisian said in Yerevan. “Even if the pipeline is put up for sale that will not create any emergency situations for our country.”

Despite starting to import gas from neighboring Iran in May 2009, Armenia remains heavily reliant on Russian gas. In addition, more than 80 percent of its gas-distribution network is owned by Russia’s Gazprom.

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6 Comments

  1. Areg Minasyan said:

    Azerbaijan is unable to succeed militarily against Armenia and wants to purchase the gas line entering Armenia instead to cut off gas supply to Armenia. I did not know that Azeri-Turks were so sharp after all!
    Azeris will fail on this matter also..

  2. Arn. Sweden. said:

    THE AZERBADJANI INTENTION IS VERY OBVIOUS,
    A TACTIC ORCESTRATED BY TURKEY ???.

    IF GEORGIA WOULD GIVE AWAY THE CONTROL TO AZERBADJAN,
    THEN GEORGIA IS PLAYING WITH FIRE.

    I DO NOT THINK RUSSIA WOULD SIT IDLE IN SUCH A CASE,
    WHEN HER STRATEGIC ALLY ARMENIAS SECURITY WOULD BE TREATHENED.

    Arn.Sweden.

  3. Osik said:

    Will be smart to wait & see what is Russia planning for Azerbaijan; it is hard to believe that the Polar Bear to let once his oil reach state to slip away for good, the Gharabagh is a two edged sword that Russia is rattling now and no one knows who’s heart he is going to pierce with.

  4. Jay said:

    Let’s take a wild guess as to why Azerbaijan’s interested in purchasing Georgia-Armenia gas pipeline. And how come Armenia is not showing any interest in purchasing the pipeline? It only makes sense if Armenia owns it. Someone please, give me Serj Sarkissian’s Cell # I’m gonna chew his you know what.

  5. Pingback: Azerbaijan’s SOCAR Interested in Buying a Stake in Georgia’s Oil & Gas Corporation | Energy Corridors Review

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