Armenian Prime Minister: Gas price will not change in Armenia after parliamentary elections

ArmInfo. Gas price will not change in Armenia after parliamentary elections, Prime Minister Karen Karapetyan stated in Armenian Parliament on December 7, answering to MP Tigran Urikhanyan's question.

According to him no facility will be given as a payment for debts. Karen Karapetyan stressed that currently as in previous years price on Russian gas will remain for Armenia the lowest in the region. As for the sale of 20% of shares of Armenia to Gazprom the Prime Minister considers that this deal is beneficial for Armenia as in any case neither Armenia nor Gazprom were getting any dividends.

To note, Armenia will purchase Russian gas for $150 for 1 thousand cubic meters. The Armenian government has approved signing of protocol between Armenia and Russia's governments on making changes in the Agreement from December 2, 2013 related to gas supply prices. According to the agreement the price of Russian natural gas to Armenia will remain $150 for 1 cubicmeters for the period between January 1, 2017 and December 31, 2017. To recall, in December 2013 Russia signed agreement with Armenia on supply of gas at $189 for 1 thousand cubic meters. In 2015 the price was reduced to $165, while on April 7 2016 after the meeting of Armenia and Russia's Prime Ministers the price was set at $150. 

On November 25, the Public Services Regulatory Commission of Armenia (PSRC) approved Gazprom Armenia's request about revision of the natural gas tariffs for consumers in Armenia. The new tariffs will come into effect on 1 Jan 2017.   When presenting the draft decision, Garegin Baghramyan, Head of the PSRC Department for Tariff Policy, said that the company's request envisages diversification of subscribers and tariffs in five groups: 1. The subscribers having the right to social allowances and consuming less than 600 cu m of gas per annum will pay 100 thsd AMD per 1 thsd cu m; 2.  Greenhouse facilities will pay 212 conventional units per 1 thsd cu m from November 1 till March 31; 3.  Processing enterprises will pay 212 conventional units per 1 thsd cu m; 4.  Subscribers consuming less than 10 thsd cu m per month will pay 139 thsd AMD per 1 thsd cu m; 5. Subscribers consuming more than 10 thsd cu m of gas per month will pay 242.1 conventional units per 1 thsd cu m. Previously, Gazprom Armenia requested the Public Services Regulatory Commission (PSRC) of Armenia to revise the gas tariffs to prevent a decline in gas nsumption, create favorable conditions for stabilization of the gas consumption market, growth of gas consumption, as well as for stimulation of the gas consuming companies' activities.  Gazprom Armenia CJSC took into ount the expected decline in the price of natural gas transit via Georgia. The contract on transit of natural gas to Armenia expires in late 2016 and that a new contract should be signed between Gazprom Export LLC (the gas supplier to Armenia) and Georgian Gas Transportation Company LLC. Gazprom Armenia also took into account that consumption is expected to grow due to the reduction in natural gas tariffs for the consumers of Armenia. Gazprom - the sole shareholder of Gazprom Armenia CJSC - is expected to finance the possible risks. To recall, once appointed Prime Minister, Karen Karapetyan stressed the need to revise the gas and electricity tariffs.  He also pointed out the need to reduce impact of the tariffs on the vulnerable social groups, as well as to ensure a galvanizing effect of the tariffs on business development, specifically in agriculture and processing industry. Gazprom Armenia CJSC is a 100% subsidiary of the Russian Gazprom and the supplier of natural gas to the domestic market of Armenia.