Armenia and Russia Agree on New Gas Deal

YEREVAN (RFE/RL) — Prime Minister Nikol Pashinian said on Monday that he has reached an agreement with Russian President Vladimir Putin on new prices of Russian natural gas for Armenia which will be set in 2019.

“Yesterday I spoke twice with Russian President Vladimir Putin by phone,” he said in a live Facebook transmission. “The theme of those phone conversations was the price of natural gas supplied to Armenia. I can say that we found a solution, at least for the foreseeable future.”

Pashinian announced that he and Putin agreed that Armenia’s national gas distribution network owned by Gazprom will pay more for the gas supplied by the Russian energy giant. Nevertheless, he said, the price will remain unchanged for Armenian consumers as a result of “our certain internal adjustments.” He did not elaborate.

Gazprom reported later on Monday that its chairman, Alexei Miller, and Armenian Deputy Prime Minister Mher Grigorian signed a deal raising the wholesale gas price from $150 to $165 per thousand cubic meters. In a statement, the Russia gas monopoly said it will continue to negotiate with the Armenian government on “the structure of internal gas tariffs” in the South Caucasus state.

The Gazprom-Armenia network has paid its parent company $150 per thousand cubic meters under a previous Russian-Armenian deal that expired on December 31. Putin and Pashinian failed to agree on a new tariff when they met in Moscow on December 27. Miller and Grigorian also reported no agreements after holding talks in Saint Petersburg on December 28.

Gazprom-Armenia cut its retail prices for Armenian households and corporate consumers in late 2016. Its chief executive, Hrant Tadevosian, complained in November 2018 that the company has operated at a loss since then. It is not yet clear whether it will be compensated by the Armenian government for the higher gas price and the resulting of loss of revenue.

Pashinian insisted that unlike in the past Armenia will not incur any debts or hand over any energy assets to Russia as a result of his latest understandings with Putin. He said nothing about political concessions to Moscow.

Gazprom cut the wholesale price for Armenia from about $190 to $165 per thousand cubic meters in 2015 and on to $150 in 2016.