GEORGIA TO SELL ARMENIA SECTION OF GAS PIPELINE

asbarez
August 11th, 2011

The Georgia-Armenia pipeline

TBILISI (RFE/RL)-The government of Georgia will likely sell to
foreign investors a minority stake in the Georgian section of a
pipeline supplying Russian natural gas to Armenia, according to a
senior official in Tbilisi.

The Georgian online news agency Bizzone.info quoted Energy Minister
Aleksandr Khetaguri as saying late on Wednesday that up to 25 percent
of shares in the pipeline could be floated soon on stock exchanges
in New York, London and Warsaw.

“We have repeatedly stated that we intend to place minority stakes
in those stock exchanges,” Khetaguri said.

“We have hired investment companies to go through all procedures,
obtain appropriate recommendations and begin the process of share
registration in order to be able to float approximately 25 percent
of minority shares in [state-run] companies,” he added.

The Georgian parliament paved the way for the sale of the so-called
North-South pipeline last year when it removed the facility of from
a list of strategic state assets not subject to privatization.

The move raised fears in Yerevan that Azerbaijan’s state oil company,
which manages Georgia’s domestic gas distribution network, could
acquire it to block the vital gas deliveries to Armenia. Some senior
Azerbaijani officials expressed an interest in such a takeover.

The Georgian government has insisted since then that it is only
considering selling a minority stake.

“The government of Georgia is not going to sell a controlling stake
in the pipeline,” Prime Minister Nika Gilauri said in Yerevan last
February. “There are strategic facilities that will continue to be
managed by the government of Georgia in the future.”

Armenian officials have similarly expressed confidence that the
authorities in Tbilisi will retain control of the trunk pipeline that
currently caters only to Armenia.

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

From: Emil Lazarian | Ararat NewsPress