By Atom Markarian
Energy Minister Armen Movsisian insisted on Thursday that Armenia’s multimillion-dollar agreement with Iran regarding a big but incomplete thermal power plant in the central town of Hrazdan will not be rescinded despite apparent pressure from Russia.
Russia, which owns another, functioning Hrazdan plant meeting 25 percent of Armenia’s electricity needs, has been trying to acquire the adjacent facility through its energy giants that already control much of the Armenian energy sector. But the Armenian government decided recently to sign a long-term management contract with a state-run Iranian firm that has pledged to invest $150 million in completing the plant.
The issue was on the agenda of Russian Prime Minister Mikhail Fradkov’s weekend visit to Yerevan. “Fradkov expressed a desire [to put the plant under Russian control] but that desire was not formalized in any way,” Movsisian said, adding that the Russian premier made no concrete investment proposals.
Movsisian made it clear that Yerevan will not reverse the deal, saying that the Iranians have already begun work on the Hrazdan plant whose projected capacity is close to that of the Armenian nuclear power station at Metsamor. He made the comments at a joint news conference with Iran’s visiting Energy Minister Parviz Fattah. The two men signed a memorandum of understanding that reaffirms Tehran’s and Yerevan’s plans to deepen bilateral cooperation on energy.
“The Islamic Republic of Iran is committed to deepening cooperation with Armenia in all spheres and embarking on new bilateral projects,” said Fattah.
Under the terms of the deal confirmed by Movsisian, Armenia will repay the Iranian investments with electricity supplies to Iran from the new Hrazdan plant. That electricity will in turn be generated by Iranian natural gas which will be shipped to Armenia through a pipeline currently under construction.
The pipeline and the Iranian-built plan should considerably reduce the Armenian energy sector’s strong dependence on Russia. That dependence will be highlighted by the expected knock-on effects of the Russian Gazprom monopoly’s decision to double the cost of gas supplied to Armenia through Georgia. Armenian officials are scrambling to prevent the announced tariff hike from taking effect on January 1.
Still, Movsisian was at pains to stress that the Armenian-Iranian energy projects are not directed against Russia. “The Iranian pipeline is not envisaged as an alternative to the Russian pipeline,” he said. “It will simply give Armenia a second source of gas and boost its energy security.”
(Photolur photo: Movsisian, left, and Fattah opening an Iranian-funded wind power plant in northern Armenia on Tuesday.)