CSOs Call For Disclosing New Agreement with Gazprom

The Coalition for Euro-Atlantic Georgia, which gathers 23 civil society organizations, watchdog groups and think tanks, said on January 12 that new transit terms with Russia’s energy giant Gazprom “worsen the country’s energy security.” 

Georgian Energy Minister Kakha Kaladze said on January 11 following the third round of talks with executives of Gazprom Export that the Georgian government made “an optimal” decision on agreeing to Gazprom’s proposal on terms of Russian gas transit to Armenia via Georgia, according to which, during the first year of the two-year contract, Georgia will partially maintain the commodity payment scheme and move to full monetary reimbursement in the second year. 

“The new terms worsen the country’s energy security and the government’s arguments concerning the new agreement are not satisfactory,” the coalition said in a statement released on January 12. 

The coalition calls on the authorities to disclose the agreement details and hold a special parliamentary hearing. 

The coalition recalled last year’s “intense discussion”, when “following negative civil society and expert assessments, the contract terms remained unchanged” and the Energy Ministry “pledged to do its utmost to maintain the existing terms of the agreement.”

“We think that the government needs to provide additional explanations on the following questions: what has changed since last year, when this position was unacceptable for the government? Why should seasonal shortage be met by Russian gas? What specific steps were taken during the year to inquire into the possibility of receiving additional gas from other suppliers? Is the transit fee in line with the price calculated under the requirements of the [European] Energy Community and has this price been approved by GNERC [Georgian National Energy and Water Supply Regulatory Commission]? Were talks based on strategic expert calculations and were international partners involved?” the coalition statement reads. 

Speaking on the matter, Economy Minister Giorgi Gakharia noted that the agreement does not require the country to buy additional gas directly from Russia and it will happen only if Georgia fails to receive additional gas from its main supplier, Azerbaijan. 

Kakha Kaladze refrained from naming the exact transit cost, but noted that it would be “one of the highest among European countries.” He also noted that considering the increasing natural gas consumption, if Georgia requires additional gas supply, it would pay USD 185 per 1000 cubic meters of Russian gas "instead of USD 215." 

The Republican Party of Georgia criticized the government for its “obscure” statements about the agreement, which, according to the party, “is financially unprofitable and politically dangerous.” 

“The government … presented this issue, like many other important issues to the society and the political spectrum, as an established fact – it agreed with the Russian side on signing a two-year agreement without informing us on its details,” the Republicans said on January 11. 

The party also seeks explanations from Kaladze on why he changed his initially negative position; what would be the exact transit fee; why was the agreement signed for a two-year-term unlike the previous yearly agreements and what is meant under the Energy Minister’s statement that “during the first year, the form of payment with commodity will be retained partially and after that, the payment will be made through monetary means.” 

UNM lawmakers described the government’s decision to accept Gazprom’s terms as “an act of capitulation” and “a very dangerous decision” for the country’s security.