Economic News from Armenia -
CONSTRUCTION OF NEW NUCLEAR POWER UNIT IN ARMENIA TO COST 5.2-7.2 BILLION DOLLARS
Noyan Tapan
Sep 24, 2008
YEREVAN, SEPTEMBER 24, NOYAN TAPAN. A document on Armenia's joining
the Global Nuclear Energy Partnership (GNEP) will be signed during a
conference of GNEP in Paris on October 1, the RA minister of energy
and natural resources Armen Movsisian stated at a September 24 event
on presentation of the sections "Information on the Environment of the
New Nuclear Power Unit in Armenia" and "Preliminary Planning Studies"
which make the main part of the documents "Feasibility Study on
Construction of a New Nuclear Power Unit in Armenia" and "Assessment
of the Impact of the New Nuclear Power Unit on the Environment". The
documents were developed with the assistance of USAID.
According to the minister, the indicated documents' section on
personnel training is being prepared with the help of the International
Atomic Energy Agency (IAEA) and will be ready in June 2009, while
the section on geophysical and seismological characteristics of
the platform of the power unit to be built is being developed with
financing of the Armenian side. The indicated documents will be
finished in June 2009.
The minister said that in December 2008 the Armenian government will
submit the bill on construction of a new nuclear power unit of the
Armenian Nuclear Power Plant (ANPP). With its adoption, the powers
and obligations of the organizations involved in the construction of
the new power unit will be established.
The U.S. ambassador to Armenia Marie Yovanovitch said that it is
planned to decommission the operating unit of the ANPP in 2016,
and taking into account the fact that it generates 40% of Armenia's
electric power, the replacement of the capacity of the operating unit
is of great importance from the viewpoint of ensuring Armenia's energy
security. This is the reason why the U.S. government assists Armenia
with creation of new replacement capacities.
In her words, the new power unit will open new opportunities for
Armenia and will enable to deepen the regional energy integration
and develop the regional energy market.
The above mentioned main sections of the documents "Feasibility Study
on Construction of a New Nuclear Power Unit in Armenia" and "Assessment
of the Impact of the New Nuclear Power Unit on the Enviroment" were
presented by Armen Arzumanian, the head of the first company of PA
Consulting Group/ Scientech group involved in the development of
the documents. He said that the operating nuclear power unit will
be decommissioned in 2016 - at the end of the designed term of its
service, in case of availability of a replacement nuclear capacity. It
is envisaged constructing the new power unit in the area of the ANPP
and putting it into operation in 2017.
The construction cost of the new nuclear power unit with a capacity
of 1,000-1,200 megawatts will make 5.2-7.2 billion USD. The only
possible source of debt finance of the project are the export credit
agencies of construction service and equipment supplying countries. The
project's financing at the expense of own capital will be done with
Armenia's state resources, and resources of private investors and a
state-private association. Financial resources of the governments of
Armenia's neighboring sates are another possible source of finance.
The calculated wholesale tariff of electricity to be generated by the
new nuclear power unit will make 7.5 cents a kilowatt if the Armenian
government is the owner of the unit, 9.7 cents if the owner is the
state-private association, and 12.7 cents if the power unit is owned
by an independent investor.
By the documents, for Armenia, the program of expansion of atomic
energy production has no economic alternative because in case of any
scenario of financing the construction of a nuclear power unit, the
cost of electricity generated by a nuclear unit is much lower than
that generated by thermal power plants with an equivalent capacity.
IRAN TO DELIVER GAS TO ARMENIA
PanARMENIAN.Net
23.09.2008 17:36 GMT+04:00
/PanARMENIAN.Net/ The head of Iranian Gas Export Company says the
country will be able to provide Armenia with the gas it needs during
the coming winter.
"Iran will pump three million cubic meters of gas to Armenia during
this winter," said Reza Kasaei-Zadeh.
Armenia's Minister of Energy, Armen Movsisyan, recently said that the
capacity of the Iran-Armenia gas pipeline project would increase to
2.5 billion cubic meters per year.
"The opening of the Iranian-Armenian pipeline will guarantee the
energy safety of Armenia," he said.
He added that this would become feasible by increasing the capacity
of the Kadzharan-Yerevan section of the pipeline by November, 2008.
The Iran-Armenia gas pipeline project was officially opened on
March 19, 2007 by Iranian President Mahmoud Ahmadinejad and Armenian
President Robert Kocharian. The project will provide Armenia with an
alternative to the gas it now imports from Russia.
The two countries will share the $220 million cost of the 140 kilometer
pipeline, Press TV reports.
PanARMENIAN.Net
23.09.2008 17:36 GMT+04:00
/PanARMENIAN.Net/ The head of Iranian Gas Export Company says the
country will be able to provide Armenia with the gas it needs during
the coming winter.
"Iran will pump three million cubic meters of gas to Armenia during
this winter," said Reza Kasaei-Zadeh.
Armenia's Minister of Energy, Armen Movsisyan, recently said that the
capacity of the Iran-Armenia gas pipeline project would increase to
2.5 billion cubic meters per year.
"The opening of the Iranian-Armenian pipeline will guarantee the
energy safety of Armenia," he said.
He added that this would become feasible by increasing the capacity
of the Kadzharan-Yerevan section of the pipeline by November, 2008.
The Iran-Armenia gas pipeline project was officially opened on
March 19, 2007 by Iranian President Mahmoud Ahmadinejad and Armenian
President Robert Kocharian. The project will provide Armenia with an
alternative to the gas it now imports from Russia.
The two countries will share the $220 million cost of the 140 kilometer
pipeline, Press TV reports.
Armenia Slides In Global Corruption Rankings
By Astghik Bedevian
The situation with government corruption in Armenia has continued to
slowly but steadily deteriorate in the past year, according to the
latest global survey released by a respected anti-graft watchdog on
Tuesday.
Every year the Berlin-based Transparency International (TI) rates
countries of the world on a 10-point scale, with zero indicating an
extremely high degree of corruption as perceived by entrepreneurs and
experts.
Armenia, along with Argentina, Moldova and four other states, ranked
109th out of 180 nations covered by Transparency International's 2008
Corruption Perceptions Index (CPI). It was assigned a score of 2.9,
faring slightly worse than it did in the previous CPI released one
year ago.
Armenia's score is based on seven corruption-related surveys
conducted by other organizations, including the World Bank. It had
already dropped by 0.1 point to 3.0 last year, dragging the country
down to 99th place in TI's 2007 rankings.
By contrast, TI found a further significant drop in perceived
corruption in neighboring Georgia, giving the latter 3.9 points and
putting it in 67th place. Georgia was 79th in last year's CPI.
As always, the Armenian government and its supporters will draw
comfort from the fact that all other non-Baltic former Soviet states
were again judged to be more corrupt than Armenia. In particular, its
arch-foe Azerbaijan regressed to 158th place in TI's latest rankings.
TI's Armenian affiliate, the Center for Regional Development (CRD),
portrayed the survey as a further indication of the `systemic'
character of bribery and other corrupt practices that have long
plagued the country. `Unfortunately, there are very few areas
unaffected by corruption,' the CRD chairwoman, Amalia Kostanian, told
a news conference. `If corruption is systemic, you can not eradicate
it in one particular area.'
The administration of former President Robert Kocharian pledged to
combat corruption throughout its decade-long rule that came to an end
last spring. It launched in 2003 a Western-backed anti-corruption
program consisting of mainly legislative measures. There is little
evidence that they have reduced the scale of graft, however.
Kocharian's successor and longtime close associate, Serzh Sarkisian,
admitted in July that the virtual absence of prosecutions of corrupt
government officials has undermined public trust in the declared
crackdowns on corruption. `People must see that we are not only
talking but also acting,' Sarkisian said in a speech. `If we talk
about corruption all day long and don't show persons engaged in it,
then our actions will not only produce zero results but will further
aggravate the situation.'
His prime minister, Tigran Sarkisian, (no relation) has been even
more vocal in acknowledging the seriousness of the problem. Sarkisian
has described graft as the number one problem facing Armenia.
Opposition politicians and other government critics dismiss the
significance of such statements, saying that corruption is one of the
pillars of Armenia's political system that has allowed Kocharian,
Sarkisian and other top officials to stay in power. They also say
that Armenian law-enforcement agencies are themselves too corrupt to
tackle the problem in earnest.
New Russian Gas Price For Armenia Unveiled
By Ruzanna Stepanian
Armenian officials disclosed on Tuesday the new, considerably higher
price of Russian natural gas which Armenia will have to pay next year
and which will rise further in 2010.
The national gas distribution company ArmRosGazprom (ARG) said that
under the terms of its agreement signed with Russia's Gazprom
monopoly last week, the gas price will grow from $110 to $154 per
thousand cubic meters starting from April 1, 2009.
The agreement signed in Moscow envisages the tariff's gradual
increase to international levels, currently exceeding $250 per
thousand cubic meters, within the next few years. According to ARG's
chief executive, Karen Karapetian, Gazprom will be charging Armenia
$200 per thousand cubic meters from April 2010.
President Serzh Sarkisian and top ARG executives downplayed the price
hike's impact on Armenian households and corporate users as they
revealed it during a meeting at the Russian-controlled company's
Yerevan headquarters. `The tariffs that will take effect on April 1,
2009 will only slightly increase the socioeconomic burden [of the
population,]' Sarkisian said.
`I am convinced that the new tariffs will not weigh heavily on the
economy,' Karapetian told reporters after the meeting. He said the
increased cost of Russian gas, the main source of winter heating for
Armenian households, will be mitigated by recent years' dramatic
appreciation of the Armenian dram against the U.S. dollar.
Karapetian also stressed the fact that the measure will take effect
after the 2008-2009 heating season and therefore spare the population
extra spending this winter.
Russian gas is also used by local thermal-power plants that general
about one third of Armenia's electricity. Whether they will seek to
raise their electricity fees as a result is not yet known.
The retail prices of gas in the country already surged by 50 percent
on May 1 after the Armenian government stopped subsidizing them with
proceeds from a controversial 2006 deal with Gazprom that left more
Armenian energy assets under Russian control.
The latest tariff deal with Gazprom came amid the nearing completion
of work on the second and final section of a gas pipeline linking
Armenia to neighboring Iran. Sarkisian announced on September 3
Armenia will be able to import up to 2.5 billion cubic meters of
Iranian gas annually `in late October or early November.'
Gazprom supplies to Armenia totaled just over 2 billion cubic meters
last year.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
By Astghik Bedevian
The situation with government corruption in Armenia has continued to
slowly but steadily deteriorate in the past year, according to the
latest global survey released by a respected anti-graft watchdog on
Tuesday.
Every year the Berlin-based Transparency International (TI) rates
countries of the world on a 10-point scale, with zero indicating an
extremely high degree of corruption as perceived by entrepreneurs and
experts.
Armenia, along with Argentina, Moldova and four other states, ranked
109th out of 180 nations covered by Transparency International's 2008
Corruption Perceptions Index (CPI). It was assigned a score of 2.9,
faring slightly worse than it did in the previous CPI released one
year ago.
Armenia's score is based on seven corruption-related surveys
conducted by other organizations, including the World Bank. It had
already dropped by 0.1 point to 3.0 last year, dragging the country
down to 99th place in TI's 2007 rankings.
By contrast, TI found a further significant drop in perceived
corruption in neighboring Georgia, giving the latter 3.9 points and
putting it in 67th place. Georgia was 79th in last year's CPI.
As always, the Armenian government and its supporters will draw
comfort from the fact that all other non-Baltic former Soviet states
were again judged to be more corrupt than Armenia. In particular, its
arch-foe Azerbaijan regressed to 158th place in TI's latest rankings.
TI's Armenian affiliate, the Center for Regional Development (CRD),
portrayed the survey as a further indication of the `systemic'
character of bribery and other corrupt practices that have long
plagued the country. `Unfortunately, there are very few areas
unaffected by corruption,' the CRD chairwoman, Amalia Kostanian, told
a news conference. `If corruption is systemic, you can not eradicate
it in one particular area.'
The administration of former President Robert Kocharian pledged to
combat corruption throughout its decade-long rule that came to an end
last spring. It launched in 2003 a Western-backed anti-corruption
program consisting of mainly legislative measures. There is little
evidence that they have reduced the scale of graft, however.
Kocharian's successor and longtime close associate, Serzh Sarkisian,
admitted in July that the virtual absence of prosecutions of corrupt
government officials has undermined public trust in the declared
crackdowns on corruption. `People must see that we are not only
talking but also acting,' Sarkisian said in a speech. `If we talk
about corruption all day long and don't show persons engaged in it,
then our actions will not only produce zero results but will further
aggravate the situation.'
His prime minister, Tigran Sarkisian, (no relation) has been even
more vocal in acknowledging the seriousness of the problem. Sarkisian
has described graft as the number one problem facing Armenia.
Opposition politicians and other government critics dismiss the
significance of such statements, saying that corruption is one of the
pillars of Armenia's political system that has allowed Kocharian,
Sarkisian and other top officials to stay in power. They also say
that Armenian law-enforcement agencies are themselves too corrupt to
tackle the problem in earnest.
New Russian Gas Price For Armenia Unveiled
By Ruzanna Stepanian
Armenian officials disclosed on Tuesday the new, considerably higher
price of Russian natural gas which Armenia will have to pay next year
and which will rise further in 2010.
The national gas distribution company ArmRosGazprom (ARG) said that
under the terms of its agreement signed with Russia's Gazprom
monopoly last week, the gas price will grow from $110 to $154 per
thousand cubic meters starting from April 1, 2009.
The agreement signed in Moscow envisages the tariff's gradual
increase to international levels, currently exceeding $250 per
thousand cubic meters, within the next few years. According to ARG's
chief executive, Karen Karapetian, Gazprom will be charging Armenia
$200 per thousand cubic meters from April 2010.
President Serzh Sarkisian and top ARG executives downplayed the price
hike's impact on Armenian households and corporate users as they
revealed it during a meeting at the Russian-controlled company's
Yerevan headquarters. `The tariffs that will take effect on April 1,
2009 will only slightly increase the socioeconomic burden [of the
population,]' Sarkisian said.
`I am convinced that the new tariffs will not weigh heavily on the
economy,' Karapetian told reporters after the meeting. He said the
increased cost of Russian gas, the main source of winter heating for
Armenian households, will be mitigated by recent years' dramatic
appreciation of the Armenian dram against the U.S. dollar.
Karapetian also stressed the fact that the measure will take effect
after the 2008-2009 heating season and therefore spare the population
extra spending this winter.
Russian gas is also used by local thermal-power plants that general
about one third of Armenia's electricity. Whether they will seek to
raise their electricity fees as a result is not yet known.
The retail prices of gas in the country already surged by 50 percent
on May 1 after the Armenian government stopped subsidizing them with
proceeds from a controversial 2006 deal with Gazprom that left more
Armenian energy assets under Russian control.
The latest tariff deal with Gazprom came amid the nearing completion
of work on the second and final section of a gas pipeline linking
Armenia to neighboring Iran. Sarkisian announced on September 3
Armenia will be able to import up to 2.5 billion cubic meters of
Iranian gas annually `in late October or early November.'
Gazprom supplies to Armenia totaled just over 2 billion cubic meters
last year.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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