Newspaper: if Gazprom keeps gas price discounts for Armenia, it will be losing $48 million a year
If Gazprom keeps the current gas price discounts for Armenia, the company will be losing around $48 million of earnings a year, according to the Russian business newspaper ‘Kommersant.’
Russia lowered the price for gas to Armenia from $189 to $165 per 1,000 cubic meters in 2015 September. Under a Russian-Armenian agreement, the gas price for Armenia in the first quarter of 2016 will remain at $165 per one thousand cubic meters.
According to "Kommersant", Gazprom and the Russian Energy Ministry declined comments on whether the Russian side agreed to extend the discount for Armenia.
"It depends on the outcome of the talks between the presidents of Armenia and Russia, (ended on March 10 in Moscow), but the likelihood of the extension of the discount is large enough. There is another option – to raise the price in Armenia, but it is a very sensitive political issue. It is not clear how a long-term resolution of this problem can be found, because the profitability of Gazprom’s supplies to Armenia are already low because of the large transport arm. The country consumes about 2 billion cubic meters of gas per year, and if the discount becomes permanent Gazprom will be losing about $ 48 million in revenue,’ ‘Kommersant’ says.
"Armenia is the largest and most reliable market of Gazprom in the Caucasus since 2006, when Azerbaijan stopped imports of Russian gas after beginning the development of the Caspian Shah Deniz field," "Kommersant" says.
The Russian gas arrives in Armenia via Georgia.-0-