The Constitutional Court upheld on Thursday the legality of the Armenian government’s latest agreements with the Gazprom gas monopoly which critics say will make Armenia even more dependent on Russia for energy.
The three agreements signed during Russian President Vladimir Putin’s recent visit to Yerevan formalized Armenian concessions made in return for a 30 percent reduction in the price of Russian gas supplied to the country. One of them will raise from 80 percent to 100 percent Gazprom’s controlling stake in ARG, the Armenian gas distribution network.
Further controversial details of the deal came to light during parliamentary hearings in Yerevan on Tuesday. In particular, it emerged that they bar the current and future Armenian governments from changing the regulatory environment for ARG or nationalizing the company for the next 30 years. ARG and a big thermal power plant owned by Gazprom will enjoy “unconditional and full protection” by the state during this time.
The Armenian side also undertook to ensure that domestic gas tariffs in the country are high enough for Gazprom to recoup 9 percent of its capital investments in the network annually. In addition, the Russian giant will have the preferential right to use an under-construction transmission line for exporting electricity from Armenia to neighboring Iran.
After an unusually short hearing and deliberations, the Constitutional Court ruled that the package of agreements does not run counter to Armenia’s constitution. The ruling paved the way for its ratification by the Armenian parliament. The government plans to push it through the parliament, dominated by its loyalists, as early as this weekend.
Some opposition lawmakers have already condemned the gas deal. One of them, Alexander Arzumanian, branded it an unconstitutional “act of capitulation” during the parliamentary hearings. “It only serves the interests of the other side,” he said.
“This structure operating in Armenia serves the interests of Gazprom at the expense of the Armenian people,” agreed Gurgen Arsenian of the opposition-leaning Prosperous Armenia Party (BHK).
Energy Minister Armen Movsisian, who signed the deal with Gazprom chief Alexei Miller on December 2, denied these claims. “The agreements put no restrictions on our rights,” he said after the court ruling.