So the gas pipeline from Iran opened today. There's a lot of backstory to that pipeline. Here's the short version. Armenia has no energy sources of its own -- no coal, no oil, no natural gas. They used to get oil and gas from Azerbaijan, but then they had a war with Azerbaijan, so no more oil or gas. There's a gas pipeline from Russia. Unfortunately it goes through Georgia. The Russians and Georgians don't always get along, and that gas pipeline is prone to mysterious explosions. (The Georgians say the Russians do it; the Russians say it's Chechen rebels in the north Caucasus.) Also, Russia has been jacking up the price of natural gas in the last few years. Armenia used to be able to buy gas from Russia dirt cheap, well below world prices. No more -- now they have to pay like everyone else. Fortunately for Armenia, there's a friendly country, rich in oil and natural gas, right next door. So the Armenians could turn to Iran for gas. Simple, right? Ah ha ha ha.
The Russians absolutely hated this idea. After all, a pipeline from Iran to Armenia could easily be stretched a bit farther, to Georgia. That would make the Georgians independent of Russia for their gas supplies. And in Moscow's eyes, the Georgians are too damn independent already. So Moscow set some conditions. One, it restricted the size of the pipeline. Originally it was supposed to be 1.5 meters wide. The Russians told the Armenians it could only be 71 centimeters wide. That way, it can only carry enough gas for Armenia, not enough to sell on to Georgia. Two, Armenia has already decided to sell the Armenian side of the pipeline to Gazprom. We all know Gazprom, right? The totally independent Russian energy company. So. [But wait, you ask. Isn't Armenia an independent country? How can the Russians just come in and tell them what to do? Well, that's an interesting topic, but it really deserves a post of its own. Let's just note that they can, and they do, and move on.] At first the pipeline will only deliver about 400 million cubic meters of Iranian gas per year. Since Armenia is currently importing about 1.5 billion cubic meters of Russian gas, that will only be a supplement. However, by 2009, when the pipeline is at full capacity, it will be able to deliver about 2.3 billion cubic meters per year. That figure is bigger than current Armenian needs, but the Armenians say they'll need more energy as their economy grows. The Armenian side of the pipeline is being built with a loan from Iran. Armenia is supposed to pay the money back by exporting electricity to Iran. Who knows if that will work, but anyway the two countries are going to link up their power grids later this year. -- I'm actually okay with this. Armenia gets some options. That's not a bad thing. However, I had to roll my eyes at this:
President Robert Kocharian and his Iranian counterpart Mahmoud Ahmadinejad inaugurated on Monday a long-awaited pipeline that will allow Armenia to import natural gas from Iran and ease its strong dependence on Russian energy resources. Lighting a symbolic torch, the two leaders officially opened the first Armenian section of the pipeline during a ceremony held in Agarak, a small Armenian town on the Iranian border... [Ahmadinejad] called the event a "big step" in the development of bilateral ties. "I am very happy and grateful to Almighty God for enabling us to open the Iran-Armenia gas pipeline and to provide a new service to the people of Armenia ," he said. "I told my good friend [Kocharian] that we are very happy because he is happy, the government of Armenia is happy, and the people of Armenia are happy," he added.Bleah. But people have to stay warm in winter somehow. So.