The Armenian government is negotiating with the Gazprom giant in hopes of securing a greater discount on Russian natural gas deliveries to Armenia, Energy and Natural Resources Minister Yervand Zakharian said on Thursday.
“Negotiations on the gas tariffs are in progress,” Zakharian told RFE/RL’s Armenian service (Azatutyun.am). “Everything is being done to have the gas price at the [Armenian] border go down.”
“We should succeed,” he said after a weekly cabinet meeting in Yerevan. He gave no further details.
Armenia currently pays Gazprom almost $190 million per thousand cubic meters of Russian gas, a price which is well below international market levels. The discount was agreed upon in late 2013 shortly after Armenia decided to join a Russian-led alliance of ex-Soviet states at the expense of a far-reaching deal with the European Union. Armenian officials said at the time that the tariff will not change for the next five years.
The Armenian government is apparently seeking a further cut in the tariff set in U.S. dollars to prevent a rise in domestic retail gas prices as a result of a nearly 20 percent depreciation of the Armenian dram registered in recent months. Citing the weaker dram, Armenia’s Gazprom-owned gas distribution network already raised the price for its large corporate consumers by over 13 percent in January. The price for households remains unchanged.
“If would be good for the economy if the [retail] price doesn’t change,” said Economy Minister Karen Chshmaritian. He claimed to be unaware of details of the ongoing talks with the Russians.
The domestic gas fees were the subject of three-day heated debates in the Armenian parliament that ended on Thursday. Opposition lawmakers questioned the veracity of financial losses posted by the Gazprom Armenia operator and said the company’s profit margins are disproportionately large.
One of those lawmakers, Aram Manukian, claimed that the gas price for households can be cut by as much as 25 percent. He accused top Gazprom Armenia executives and government officials interacting with them of pocketing company funds.
Pro-government deputies denied the allegations.