To strengthen its energy independence, Armenia has intensified its relations with Iran. Please, comment on the joint projects under way.
Armenia and Iran are implementing a number energy projects, including construction of Meghri hydropower plant at Arax River, oil pipeline, gas pipeline as well as construction of the third power line.
Would you elaborate on the construction of Meghri hydropower plant? When the construction works be started and how much will they cost? Are there plans to build similar plants in the future?
Armenia and Iran are planning to build two high-capacity hydropower plants: in Meghri and Karachilar (Iran). Each plant is envisaged to generate 793mln kilowatt/h of electric power. Preparations for the construction in Meghri will finish this year, the project being estimated at $323mln to be invested by the Iranian Investment Company. According to the agreement, the power generated by the plant will be delivered to Iran during 15 years. Afterwards, the plant will be transferred to Armenian side. As to construction of other plants, it's hardly possible as Armenia doesn't possess sufficient water resources.
What about the power line to be built?
70% of the third Armenia-Iran high-voltage power line will be built by the end of 2011. The project is estimated at euro 100-105 million and is implemented by Sanir Iranian company. The operating power lines have a capacity of 450 megawatt. Together with the third one, the capacity will make 1200 megawatt.
Please tell about the Iran-Armenia gas pipeline. How much will the project cost and is construction of a second line possible?
Energy diversification is one of Armenia's energy security factors. That is why we consider the advisability of both the pipeline delivering Russian gas through Georgia and Iran-Armenia pipeline. In 2011, we have ensured 15% growth in power generating sector, 12% of which was exported to Iran in the framework of “gas in exchange for eclectic power” project. Moreover, Iran-Armenia gas pipeline can satisfy Armenia's needs in force majeure situation. Construction if a second pipeline is not planned.
How do matters stand with Iran-Armenia oil pipeline?
Construction of the oil pipeline is expected to be finished in 2014. It will allow Armenia to export oil products both from Iran and the Persian Gulf, a major market for petroleum products. Persian Gulf market prices significantly differ from those at Mediterranean Sea, which will enable Armenia to dramatically decrease transportation expenses. Construction of Armenia-Iran pipeline will be funded on both sides, with Armenia allocating $100mln to the project. Pipeline operation contract will be concluded for the period of 25 years. Armenia's internal need for oil products comprises 400 thousand ton a year. Relevant documents can be signed during the visit of Iranian President Mahmoud Ahmadinejad to Armenia.
Will an oil refinery be built in Armenia? Armenia and Iran used to discuss the matter some time ago…
The idea to build an oil refinery in Armenia is alive and construction of the oil pipeline is a part of it. However, to implement such huge project a relevant infrastructure is needed, including construction of Iran-Armenia railroad, which will transport the products to foreign markets. I think this idea will be realized one day.
How do you assess cooperation with Iran? How will our country's energy security improve and what role can it have in the region?
I rate the cooperation with Iran as satisfactory. As to energy security it's hard to produce figures - 20% or 30%. Anyway, Armenia is going to become one of the leading regional countries from the viewpoint of energy security.