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Georgia: Winter Gas Gamble
[04:49 pm] 23 December, 2006
Georgia: Winter Gas Gamble
After rejecting Russian gas, Georgia looks to
Azerbaijan and Turkey for emergency supplies.
By Nana Kurashvili in Tbilisi
"Again nothing new," said Tbilisi resident Malkhaz Gelovani, 56,
after watching the latest news. "They make promises, but no real
decisions have been made yet."
Like everybody else in Georgia, Gelovani is waiting anxiously for
the outcome of negotiations between Georgia, Azerbaijan and Turkey
over gas supplies to Georgia this winter.
After the government in Tbilisi decided to reject Russian gas, which
is doubling in price from the New Year, the three countries are
negotiating about the provision of extra supplies from Azerbaijan’s
Shah Deniz gas field in the Caspian Sea, a development of which
started a month ago.
A Georgian government delegation led personally by President Mikheil
Saakashvili arrived in Turkey on December 20 for talks over this
issue. After the first round of discussions, Georgian energy minister
Nika Gilauri commented only that Georgia would have gas on January 1.
"Today we pay all the fees and tariffs, and all families in Georgia
have had light and warmth for the past two years," Saakashvili
told a press conference in Ankara. "We are not going to change our
policy and return to the times of darkness and cold apartments.
The Georgian government will do its utmost to ensure energy security
for its country."
In November, the Russian gas monopoly Gazprom said it would increase
the price of gas for Georgia to 230 dollars per 1,000 cubic meters
in 2007, which is more than double the amount Georgia paid in 2006
and the highest price among CIS countries.
Gazprom made it clear that the price would only be lowered if Georgia
agreed to sell its main gas pipeline to the company.
Saakashvili called Gazprom’s decision "political, not commercial",
and insisted his country would refuse to buy gas from Russia and
definitely not sell any of its assets to Gazprom.
Georgia’s main hope now lies in the South Caucasus pipeline running
from Baku to the Turkish city of Erzerum via Georgia, which is still
under construction. The pipeline is due to provide Georgia with
300 million cubic metres of gas for 63 dollars per thousand cubic
meters in 2007. Turkey’s share for 2007 is 2.8 billion cubic metres,
but the Turkish segment of the pipeline has not been finished yet,
meaning it will be some time before the country is ready to start
receiving gas from Azerbaijan.
As a result, Azerbaijan and Georgia plan to share Turkey’s portion of
gas. After preliminary talks in Baku, it was announced that Georgia
will receive 800 million cubic metres of the supplies meant for Turkey,
in addition to its own share from Shah Deniz. However, this would
still leave Georgia with a shortfall of 600-700 million cubic metres.
Some experts say that in the long run Turkish gas will cost Georgia
no less than that from Russian.
"I hope Georgia won’t be left without gas, but, because it’s short
of time, the government may have to agree to worse conditions,"
energy expert Giorgy Khukhashvili told IWPR.
To meet the shortfall, Georgia has also been talking to Iran about
receiving gas, thereby risking the disapproval of its main ally,
the United States.
John Tefft, US ambassador to Georgia, told Georgian journalists that
"a long-term strategic cooperation between Georgia and Iran in the
gas field is unacceptable to the USA".
Giorgy Khukhashvili warned that "getting involved with Iran is,
in the current political situation, a risky move for Georgia".
"Georgia has declared that its orientation is towards the European
Union and NATO, which is why it must pay heed to recommendations
given by its strategic partners. If Georgia has to choose – to buy
gas from Iran or Russia at one and the same price, the preference
should be given to the old headache, rather than the new one," he said.
However, Paata Zakareishvili, head of the Development and Cooperation
Centre, said that the Georgian authorities had stated clearly what
the direction of their foreign policy was, and Washington should have
no doubts on that score. "I think that Washington can close its eyes
at some moves taken by Tbilisi under pressure," he said.
Ordinary citizens have been following the talks closely. They are
all too aware of what living without electricity and gas would mean,
having endured darkness and cold for years after the country became
independent in 1991. The situation has improved markedly since the
Rose Revolution of 2003, but no one is relaxed about it.
Housewife Lali Dadunashvili said she knew "probably as much as the
energy minister himself" about the gas talks. "I watch absolutely
all the news broadcasts to know whether we are going to have gas or
not. It’s frightening even to think what may happen to us this winter,"
she said.
Lali lives in a two-room apartment together with her four children
and husband. They warm themselves with a gas stove and use gas to
heat their water as well. She recalls with horror the situation last
January when explosions along the pipeline connecting Russia and
Georgia left the country without fuel for weeks.
"We wore fur coats at home, we slept in our warm clothes and stood
freezing in queues for kerosene for hours… God forbid this should
happen again!" she said, adding she didn’t care where the gas came
from – Russia or Iran, "just so long as there is some!"
Gocha, who sells gas stoves at the market, said his trade was
brisk. "People are still buying gas stoves. Our president has promised
we’ll have gas, and that means we’ll have it," he said. "Why shouldn’t
we believe him? We can do without Russian gas."
But doctor Malkhaz Gelovani is angry with the government. "The
authorities are promising that there will be no gas problem this
winter, but that’s hard to believe. They’d better tell us the truth
and explain why we are refusing Russian gas and what the winter holds,"
he said.
Nana Kurashvili is a reporter for Imedi television in Tbilisi. IWPR