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Armenia, Iran sign $30-mln credit agreement for pipeline constructio

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  • Armenia, Iran sign $30-mln credit agreement for pipeline constructio

    Armenia, Iran sign $30-mln credit agreement for pipeline construction

    Interfax
    Sept 9 2004

    Yerevan. (Interfax) - Armenia and Iran signed a $30-million credit
    agreement on Wednesday to finance the construction of the Armenian
    section of the Iran-Armenia gas pipeline.

    Energy is an important sector in cooperation between the two countries,
    which have already gained a wealth of experience in cooperation in
    this sphere, Armenian President Robert Kocharian said at a press
    conference following the signing of the agreement.

    "More serious steps will be taken based on this experience on the path
    to unite the infrastructure of both states and raise mutual relations
    to a qualitatively new level," Kocharian said, adding that the
    construction of the pipeline has an important regional significance.

    Iranian President Mohammad Khatami, who was at the press conference,
    also said bilateral cooperation was important in the energy sphere.

    According to the agreement, Iran is to provide Armenia with a credit
    of $30 million to build the Armenian section of the Iran-Armenia gas
    pipeline. The credit will be provided for 7.5 years at 5% per year.
    The funds will be used to finance the construction of a pipeline from
    the border town of Megri to Kajaran.

    Construction of the Armenian section of the pipeline should begin at
    the end of 2004. Armenia will finance work to reconstruct and change
    parts on the Kajaran-Yerevan gas pipeline.

    Armenia and Iran signed an agreement on May 13 for the construction
    of a pipeline between the two countries. The pipeline is 141 km long,
    inducing 41 km in Armenia and 100 km in Iran. The total cost of the
    project is estimated at $210-$220 million. The pipeline is expected
    to be launched before January 1, 2007.

    Gas should start to arrive in Armenia from January 2007 and will
    be used at Armenian thermal power plants to produce electricity for
    export to Iran. Iran will supply 36 billion cubic meters of natural
    gas to Armenia over 20 years according to the document.
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