Month: April 2007

GAZPROM FIXES ARMENIAN GAS PRICE AT $110/KM3 AND GAINS CONTROL OF PIPELINES

European Spot Gas Markets
April 6, 2006 Thursday

Russian gas monopoly Gazprom this week agreed to supply gas to Armenia
at a fixed price of US$ 110 per thousand cubic metres until 2009
in return for control of Armenia’s gas pipelines, part of a power
station and the 40km pipeline from Iran.

"The deal was struck this week," a Gazprom spokesman told The Heren
Report, explaining that Gazprom would soon hold around an 80% of the
joint venture ArmRosGazprom. It is believed that Gazprom will build
a 140 MW gas turbine at the Rasdan 5 power station. "The deal will
have several stages and will be completed later this year," he added.

Mikhail Korchemkin, a US-based Russian gas expert, said the deal was
good for both Gazprom and Armenia but added that he was surprised the
price had been fixed in absolute terms. "Gazprom is adding assets
all over the world. Expansion is the major goal of Gazprom now,"
he told The Heren Report, adding that buying overseas assets was
the only way for the Russian gas giant to support its share price,
given the declining output from its Russian fields.

In January, Russia doubled the price for gas supplies to Armenia from
US$ 54 per thousand cubic meters to US $ 110 as part if its drive to
raise gas prices across former Soviet republics in line with European
levels. Gazprom will also take charge of the construction of a second
197km pipeline between Iran and Armenia.

Armenia does not produce gas but uses it for power generation, which
consumes around 1.7 billion cubic metres of gas a year.

ARMENIA: IN SEARCH OF ALTERNATIVES; ARMENIA IS THROUGH WITH LISTENING TO MYTHS ABOUT RUSSIA
by Gajane Movsesjan
Translated by A. Ignatkin

Source: Vremya Novostei, April 6, 2006, p. 5
Agency WPS
What the Papers Say Part B (Russia)
April 6, 2006 Thursday

Armenia may decide that it doesn’t need Russia after all; Armenian
Foreign Minister Vardan Oskanjan’s two-day visit to Moscow begins
today. Oskanjan will meet with his Russian counterpart Sergei Lavrov
and Security Council Secretary Igor Ivanov. He met with US Secretary
of State Condoleezza Rice in Washington the other day.

Armenian Foreign Minister Vardan Oskanjan’s two-day visit to Moscow
begins today. Oskanjan will meet with his Russian counterpart Sergei
Lavrov and Security Council Secretary Igor Ivanov. Official reports
on the agenda are brief. They indicate that it includes bilateral
relations, the Nagorno-Karabakh problem, regional matters, and
cooperation within the framework of international organizations.

Sources from Armenian diplomatic circles say that this is just a
routine visit, nothing more.

What is interesting, however, is that Oskanjan discussed the same
matters with US Secretary of State Condoleezza Rice in Washington
the other day. Oskanjan and Rice signed an accord on March 27 to the
effect that Armenia will receive $236.5 million under the Millennium
Challenges program over the next five years. The millions will be
used to repair roads in rural areas, reconstruction of irrigation and
drainage systems, and reduction of impoverishment in the agricultural
sector.

Rice herself undermined political undertones of this seemingly economic
event at the signing ceremony when she began elaborating meaningfully
on the necessity of advancement of democratic reforms in Armenia in
the light of the parliamentary and presidential elections there in
2007 and 2008. Armenian observers took her words as an admission
of Washington’s desire to bring political and economic processes
in Armenia under its own control. Moreover, the program itself
(Millennium Challenges) was taken as but an additional instrument of
American influence with Yerevan.

Shushan Khatlamadzhjan, an analyst with the Armenian Institute of Civil
Society and Regional Development, believes that the Armenian-Russian
strategic partnership is in a crisis. "The problem is rooted in the
lack of transparency of the talks between the Armenian and Russian
authorities," she said. "Armenian society feels disassociated from
public politics and cannot help ascribing it to some clandestine
accords between the governments of the two countries… Like a
recompense to Armenia for high gas tariffs in the form of a discount on
Russian military hardware as some Russian media outlets speculated. In
short, even pro-Russian political forces in Armenia begin promoting
the necessity to develop foreign policy on the basis of the actual
national interests and not the old myths…"

Now let’s consider the problem of Nagorno-Karabakh. Chairmen of
the OSCE Minsk Group, Russia and the United States have headed the
mission of intermediaries for a decade now. With nothing to show
for it in terms of the formula of a lasting peace. A meeting between
the presidents of Armenia and Azerbaijan in France was arranged this
February but even it failed as a means of accomplishing anything.

Foreign intermediaries are analyzing the situation again now. The
United States is particularly impatient. American diplomacy put Yerevan
and Baku under pressure in March. Daniel Fried, US Undersecretary of
State for Europe and Eurasia, was dispatched to the region. Fried
announced that the United States wanted a compromise between the
warring sides reached this year.

The United States is impatient and the European Union is certainly
getting active. Armenian analysts and observers ascribe these
trends to the desire on the part of the West to resolve conflicts
in the post-Soviet zone in such a manner as to weaken Russia’s
positions. As far as Khatlamadzhjan is concerned, it is precisely
from this standpoint that specialists should contemplate the renewed
debates over the so-called "Marshall Plan for the Caucasus." The idea
boils down to substantial economic aid to countries of the southern
part of the Caucasus in return for political concessions. "Russia
is in the situation where a new and effective policy with regard to
Armenia becomes a must," Khatlamadzhjan concluded.

Khatlamadzhjan also believes that "the myth in Armenia of there being
no alternatives to strategic partnership with Russia is in its last
throes." "Armenia may solve its regional problems and resolve conflicts
without military and other cooperation with Russia, accepting instead
the plan and investments from the West. There is the widespread opinion
in analytical community here that there can be no war or peace without
Russia, but we shouldn’t make a fetish of this fact or demonize it,"
she said.

WITHDRAWAL OF ARMAMENT FROM THE RUSSIAN MILITARY AKHALKALAKI WILL BE RESUMED ON APRIL 12 AND ACCOMPLISHED BY THE END OF MAY

Source: Voenno-Promyshlenny Kuryer, No. 13, April 04-10, 2007, p. 5
Agency WPS
DEFENSE and SECURITY (Russia)
April 6, 2007 Friday

Six automotive columns with armament and property of the base will
be sent from Akhalkalaki (Georgia) to the Russian military base in
Gyumri (Armenia) between April and May and on May 17 and 24 a part
of armament and property will be transported to Russia by railway
in two trains. The schedule of withdrawal of armament, property
and servicemen of the base was approved by the Defense Ministry
of Georgia. A representative of the command of the base reports
that the withdrawal of Russian servicemen from Akhalkalaki and the
reassigning of objects of the Russian base to the Georgian Defense
Ministry will be accomplished by July 1. All heavy armament of this
base was withdrawn from Georgia in 2006. The withdrawal of property
and equipment of the Russian base in Batumi started two years ago
and will be restarted in April, to be accomplished in 2008.

TURKEY SENDS BLUNT MESSAGE TO FRANCE
by Judy Dempsey – The New York Times Media Group

The International Herald Tribune
April 6, 2007 Friday

Ankara, angered by Armenian bill, halts pipeline talks

Turkey said Thursday that it was suspending talks with Gaz de France on
joining a major natural gas pipeline consortium, a political move aimed
at putting pressure on both Paris and Brussels that European Union
officials said could further delay one of the biggest energy projects.

Turkey, which is angry about a pending French bill that calls the
mass killing of Armenians during Ottoman rule a genocide, said that
it would await the outcome of presidential elections next month
in France before deciding if it would allow Gaz de France into the
five-nation consortium that is leading the project, the Anatolia news
agency reported, citing the Energy Ministry.

"We will decide according to policies to be followed after the
elections," a senior Turkish Energy Ministry official, who declined
to be identified, was quoted by Reuters as saying in Ankara.

Turkey’s blunt message to France was also seen as a reminder to
Brussels of the strategic importance of the country for the EU’s
energy ambitions at a time when talks on Turkey’s application for
membership to the bloc are going badly. Negotiators are about to
tackle the energy section of the discussions.

One European Commission official, speaking on condition of anonymity
because of the sensitivity of the talks, said Turkey "knows its value
as the major transit country for this project and is making the most
of it."

The official said that the suspension had more to do with politics
than the economics of the project, conceived in 2002 as the EU’s
first attempt at forging a common energy policy.

The consortium wants to build the ¤4.6 billion, or $6.2 billion,
Nabucco pipeline, which would bring natural gas from Iran and the
Caspian sea across Turkey to Western Europe, bypassing Russia. The
project is already a year behind schedule, with completion now planned
for 2012.

OMV, the Austrian energy company that heads the Nabucco consortium,
said Thursday that a feasibility study had been carried out, and
confirmed that it was seeking another partner to share the costs.

"Financing possibilities are currently being evaluated," said Andrea
Hof, a spokeswoman for OMV. The other consortium members include
MOL of Hungary, Transgaz of Romania, Bulgargaz of Bulgaria and Botas
of Turkey.

But she would not confirm that the consortium was holding talks with
Gaz de France, after talks with Total, also based in France, collapsed
this year. "There are ongoing talks with several possible partners,"
she said.

Reached by phone, a spokesman for Turkey’s Energy Ministry confirmed
that the consortium had been holding talks with Gaz de France. But
he declined to comment on any suspension, or if Gaz de France had
been notified.

"We do not want to comment on this because it is a political issue,"
the ministry spokesman said.

Turkey says that claims by Armenia that the Ottoman empire committed
genocide against 1.5 million Armenians during World War I are greatly
exaggerated.

Ankara protested loudly last year after the National Assembly of
France passed a bill that would make it a crime to deny that the
killings amounted to genocide. The bill still has to be approved by
the Senate before becoming law.

In Paris, a spokeswoman for Gaz de France would not comment on
Turkey’s decision, or even confirm that it was negotiating to become
part of the 3,300 kilometer, or 2,050 mile, Nabucco pipeline. "What
we can say is that we are interested in the project," Sabine Wacquez
said. By joining the Nabucco consortium, Gaz de France would be able
to further the diversification of its natural gas supplies.

Gaz de France this year agreed to a contract with Russia’s giant
state-owned energy company Gazprom. Gazprom will for the first time
use Gaz de France’s distribution network to sell Russian natural gas
directly to French consumers. In return, Gaz de France will receive
more Russian natural gas in the form of long-term contracts. France
already gets 16 percent of its total natural gas needs from Russia.

Natural gas accounts for 15 percent of all energy consumption; most
of the country’s energy needs are met by nuclear power.

Turkey, which is almost completely dependent on energy imports, hopes
Nabucco will give it the chance to become an energy hub in Europe. At
the same time, it wants to diversify its energy imports away from
Russia, on which it – like most of Europe – is very dependent.

Because of its location between Europe, the Caucasus and Central Asia,
Turkey has become strategically important for the energy ambitions
of both the EU and Russia.

Russia has already built the Blue Stream natural gas pipeline that
reaches Turkey by running under the Black Sea. Gazprom now plans to
extend this pipeline up through Romania and Serbia into Hungary with
Hungarian support, even though Hungary is a member of the Nabucco
consortium.

Ferenc Gyurcsany, the prime minister of Hungary, and Vladimir Putin,
Russia’s president, agreed last June to extend the Blue Stream pipeline
to Hungary.

During an interview last month, Gyurcsany said Nabucco was "a dream.
An old dream. We cannot heat apartments with dreams." He also said
that an extended Blue Stream project was much better organized.

Turkey has made threats against France before. After the vote in the
National Assembly, Turkey’s armed forces said that they would freeze
bilateral ties with its NATO ally. But officials at NATO say that
there has been no sign of any change in French-Turkish relations.

–Boundary_(ID_Y7yxxmNl+IB7xbgt7DPfHQ) —

FRANCE HAS ‘NO CONFIRMATION’ FROM TURKEY OF SUSPENSION OF TALKS WITH GDF

AFX International Focus
April 5, 2007 Thursday 1:22 PM GMT

PARIS (AFX) – The French foreign ministry said it has received ‘no
confirmation’ from Turkey of the suspension of talks with Gaz de
France over the Nabucco pipeline project.

A spokesman for the ministry said ‘We have received no confirmation
to this effect from the Turkish authorities,’ adding that the French
government had only learnt of the matter from press reports this
morning.

Earlier today, the Anatolie press agency reported that Turkey had
halted talks with Gaz de France in reaction to a French bill on the
mass killings of Armenians during Ottoman rule.

Contacted by the French press agency, Agence France-Presse (AFP),
a spokesman for GDF refused to comment on the claims.

AFP also contacted Botas, the Turkish state-owned oil and gas group
which is one of partners in the Nabucco consortium, but the company
declined to comment.

Armenians claim up to 1.5 mln people perished in systematic
deportations and killings between 1915 and 1917 under the Ottoman
Empire, modern Turkey’s predecessor.

Turkey categorically denies claims of genocide and says thousands of
Turks and Armenians were killed in civil strife when Armenians took
up arms for independence in eastern Anatolia and sided with Russian
troops invading the crumbling empire.

TURKEY SUSPENDS TALKS WITH FRANCE OVER PIPELINE PROJECT

Agence France Presse — English
April 5, 2007 Thursday 10:07 AM GMT

Turkey, reacting to a French bill on the World War I massacres
of Armenians, has suspended talks with Gaz de France (GDF) on the
French firm’s possible participation in a major pipeline project,
the Anatolia news agency reported Thursday.

Turkey’s energy ministry and the state-owned oil and gas company
BOTAS, which is part of the Nabucco consortium building the pipeline,
refused to comment on the report.

The five-company consortium plans to build a 3,300-kilometre
(2,000-mile) conduit that will carry natural gas from the Middle East
and Central Asia to the European Union via Turkey and the Balkans,
bypassing Russia.

The other partners in the venture are Austria’s oil and gas group OMV,
Hungary’s MOL, Bulgaria’s Bulgargaz and Romania’s Transgaz.

The consortium had been in contact with GDF for some time as part
of its efforts to find a sixth partner in the six-billion-dollar
(4.5-billion-euro) project, which is expected to become operational
in 2012.

The four other partners approved GDF’s participation, but Turkey
has opposed it because of a French draft law that makes it a jailable
offense to deny that Ottoman Turks committed genocide against Armenians
during World War I, Anatolia said.

The bill was adopted by the National Assembly in Paris in October but
must still go before the Senate, then back to the lower house before
becoming law.

Turkey had at the time threatened unspecified measures against the
bill, which it denounced as a "heavy blow" to bilateral ties.

In November, the Turkish army froze military ties with France over
the bill.

Armenians claim up to 1.5 million of their kin perished in systematic
deportations and killings between 1915 and 1917 under the Ottoman
Empire, modern Turkey’s predecessor.

Turkey categorically denies claims of genocide and says thousands of
Turks and Armenians were killed in civil strife when Armenians took
up arms for independence in eastern Anatolia and sided with Russian
troops invading the crumbling empire.

Much to Turkey’s ire, many countries have recognised the killings
as genocide.

ALIYEV-KOCHARIAN TALKS HAMPERED BY TENSIONS – GARABAGH MEDIATOR

AssA-Irada, Azerbaijan
April 5, 2007 Thursday

The next round of talks on the Upper (Nagorno) Garabagh conflict
between Azerbaijani and Armenian Presidents Ilham Aliyev and Robert
Kocharian is being impeded by tensions between the parties that
emerged since the November 2006 meeting of the two leaders in Minsk,
the French mediator visiting Baku has said.We therefore decided to
visit the region to arrange a meeting of the two foreign ministers, the
co-chair of the mediating OSCE Minsk Group (MG), Bernard Fassier, told
a news conference Thursday.He noted that a similar situation emerged
in the run-up to the 2005 parliamentary elections in Azerbaijan. The
diplomat said the presidents talks depended on the efficiency of the
next meeting of foreign ministers Elmar Mammadyarov and Vardan Oskanian
due in Geneva as well as further ministerials and expressed hope that
it would be successful. Fassier said he discussed the possibility
of holding the presidents meeting with the Armenian and Azerbaijani
leaders on Wednesday and Thursday.

During the visit, he also exchanged views on the return of Azerbaijani
refugees home, pointing to some problems in this area.

Touching on recent calls for the European Unions involvement in
mediating talks, Fassier said the EU is putting forth relevant
initiatives, but the Minsk Group is the only group directly involved
in brokering peace talks.The diplomat said both the G8 states and
the European Union envoy on South Caucasus Peter Semneby have made it
clear that they politically support the MGs activity. He added that
the 27-member union could play an important role in the development
of education, public opinion and restoration of relations between
Azerbaijan and Armenia. With regard to some allegations that the
Kosovo model could be applied in the Armenia-occupied Upper Garabagh
region a claim by Armenians that is dismissed by Azeri officials
and international diplomats Fassier reiterated that the Kosovo
settlement could not serve as precedent. The Kosovo problem differs
from the conflicts flaring in the ex-Soviet republics, he added.The
French co-chair, who had talks in Baku after visiting Yerevan and
Tbilisi, said he plans to visit Armenia again on Monday to discuss
the outcome of the talks he had in the Azeri capital with Yerevan. On
Tuesday, he is to meet with his US and Russian counterparts to mull
the outcome of his visit to the region. This will be followed by a
meeting of the Azeri and Armenian foreign ministers on the next day
to be attended by the Minsk Group co-chairmen.Azerbaijan and Armenia
fought a lengthy war that ended with the signing of a cease-fire in
1994, but Armenia continues to occupy Upper Garabagh and seven other
Azerbaijani districts in defiance of international law. Peace talks
have been fruitless so far and refugees remain stranded.

BAKU, YEREVAN AGREE TO HOLD ANOTHER MINISTERIAL

AssA-Irada, Azerbaijan
April 5, 2007 Thursday

Azerbaijani and Armenian foreign ministers Elmar Mammadyarov and
Vardan Oskanian meeting in Geneva on Wednesday agreed to hold another
round of talks on the Upper (Nagorno) Garabagh conflict in April,
the Azerbaijan Foreign Ministry said. Commenting on the outcomes of
the meeting, attended by the OSCE mediators from the United States,
Russia and France, a spokesman for the ministry Khazar Ibrahimov said
the venue and timing of the next meeting will depend on the ministers
schedules. It is not ruled out that the ministerial will take place
on the sidelines of the next meeting of the CIS Foreign Ministers
Council due in Astana, Kazakhstan April 25. Ibrahimov noted that
holding another meeting of the two presidents was among the issues
discussed in Geneva.

But it should be taken into account that it could be held only if
there is a substantial basis for this, which is missing right now.

Armenian Foreign Minister Vardan Oskanian said the parties did not
succeed in ironing out major differences of opinion. Now we understand
each others positions more clearly, but it is also clear that there
are profound contradictions in them, he said. At the same time,
Oskanian said hopes for progress in the peace process remain.

We believe that there is a good foundation for negotiations
and opportunities to move forward are still there. The Armenian
minister noted that there is a substantial document that lays out
opportunities for the conflict settlement. Russian co-chair of
the mediating OSCE Minsk Group, Yury Merzlyakov, said a document
outlining basic principles of the Garabagh settlement, developed by
the intermediaries, was discussed at the Geneva ministerial. These
include the status of Upper Garabagh and the pullout of the Armenian
armed forces from the occupied territories. Azerbaijan and Armenia
fought a lengthy war that ended with the signing of a cease-fire in
1994, but Armenia continues to occupy Upper Garabagh and seven other
Azerbaijani districts in defiance of international law. Peace talks
have been fruitless so far and refugees remain stranded.

From: Emil Lazarian | Ararat NewsPress

RICE WARNS CONGRESS AGAINST TABLING ARMENIAN GENOCIDE

AssA-Irada, Azerbaijan
April 5, 2007 Thursday

US Secretary of State Condoleezza Rice and Defense Secretary Robert
Gates have called on the House of Representatives, the legislatures
lower chamber, not to table the so-called genocide of Armenians. In
a joint letter, the two warned that the approval of Armenians claims
would deal a blow to the relations between the United States and
Turkey, as well as US foreign policy. Ankara has moved to convince
the US legislature not to put the issue on discussion, as Turkish
parliament members started meetings in Washington. A draft resolution
on the fake genocide was forwarded to the House in February but
discussions on the issue have been postponed till April. Armenians
say that 1.5 million Armenians died in the Ottoman Empire at the
end of World War I, a claim strongly denied by the Turkic world. US
top business leaders, including Microsoft boss Bill Gates, earlier
called on President George Bush to prevent recognition of the so-called
genocide, warning that the trade relations between the U.S. and Turkey
may be severed if the decision is passed.

From: Emil Lazarian | Ararat NewsPress

FRENCH GROUP’S PARTNERSHIP IN PIPELINE PROJECT REPORTEDLY SUSPENDED

Anatolia News Agency, Turkey
April 5, 2007 Thursday

["PARTNERSHIP OF GAZ DE FRANCE TO NABUCCO PROJECT POSTPONED" –
AA headline]

ANKARA (A.A) -05.04.2007 -Partnership of the "Gaz De France" to the
Nabucco Project envisaging construction of a pipeline to transport
Azerbaijani and Iranian natural gas to Europe through Turkey, has
been suspended for a while.

Sources said that Omv of Austria, Mol of Hungary, Bulgargaz of
Bulgaria and Transgaz of Romania accepted Gaz de France’s becoming
the 6th partner of the project while Petroleum Pipeline Cort (BOTAS)
of Turkey put reservations.

Approval of a bill on so-called Armenian genocide by the French
parliament last year influenced the Turkish party’s decision.

Meanwhile, construction of the 3,300 km-kilometre pipeline is expected
to begin in 2008 and is planned to be finished in 2012.

The construction is estimated to cost 4.6 billion euro. The cost is
to be shared among the five gas companies in each of the countries.

The transport capacity of the pipeline will reach up to 25.5 billion
cubic meters per year in the long term, around or after 2020.