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Thursday, October 11, 2007

Azerbaijan to boost Georgia gas supply

10 October 2007 - Upstream OnLine - Azerbaijan's state gas company, Azerigas, has started reconstruction of a gas pipeline to Georgia that it plans to use to double gas deliveries to its neighbour from next year. Azerbaijan will send Georgia 3 million cubic metres of gas per day in 2008 through the pipeline from Baku to the Georgian border. Zaman Chelabiev, general director of Aztransgas, the transport arm of Azerigas, told Reuters the reconstruction work would be completed by next year. "The government of Azerbaijan has ordered us to expand the capacity of the 3 MMcmd," Chelabiev told reporters. Azerbaijan currently sells 1.5 Mmcmd to Georgia at $120 per 1000 cubic metres, or almost half the price Georgia pays for its gas from Russia's gas export monopoly Gazprom. Georgia has been seeking an alternative supply after Gazprom doubled the price of gas to the country last year. Gazprom charges Georgia $235 per Mcm. Since March, Georgia has also being buying 1.5 MMcmd from Azerbaijan's offshore oil project Shah Deniz at $63 per Mcm.

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