By Shakeh Avoyan
Armenia and Iran agreed on Thursday to build a third high-voltage transmission line that will connect their power grids in time for an anticipated sharp increase in Armenian electricity supplies to the Islamic Republic.
Energy Minister Armen Movsisian and his visiting Iranian counterpart Habibollah Bitaraf signed the agreement just two days after inaugurating in southeastern Armenia the second power line constructed with a $8.5 million Iranian loan. They said the construction of the third, twice as powerful line will begin soon and will be completed within two years.
"The third transmission line will be important for economic relations between the two countries, especially for their cooperation in the energy sector," Bitaraf told a joint news conference.
The Iranian government will underwrite the $25 million construction work with another loan. Officials said it will likewise be repaid with electricity generated by Armenian power plants.
Movsisian argued that Armenia needs extra capacity to substantially boost the volume of its energy deliveries to Iran in 2007 when it is expected to start importing Iranian natural gas through a pipeline which is currently under construction. Work on its 42-kilometer Armenian section got underway on Tuesday in the presence of Prime Minister Andranik Markarian and the two energy ministers.
The pipeline will be built with a separate $30 million credit provided by Tehran. It too will be repaid with Armenian electricity supplies.
Armenian officials say the pipeline will significantly reduce their country's dependence on Russia, currently its sole supplier of natural gas and other energy resources.