Yerevan and Tehran Agree to Expand Gas-For-Electricity Swap

Armenia and Iran are expanding their long-running gas-for-electricity swap program after identifying mutual demand for higher energy exchanges, according to Armenia's Minister of Territorial Administration and Infrastructure Davit Khudatyan. The existing infrastructure allows for expansion, with additional capacity in the pipeline and a planned 400-kilovolt transmission line that will enable significant increases in electricity exports.

The gas-for-electricity arrangement has been in place since 2009, with Armenia receiving natural gas from Iran and supplying three kilowatt-hours of electricity generated at Armenian thermal power plants for every cubic meter of gas imported. The pipeline is owned by Gazprom Armenia, a subsidiary of Russia's Gazprom.

Khudatyan rejected suggestions that the move was driven by concerns over a possible increase in the price of Russian gas, stating 'There are no concerns. This is simply part of the normal working process.' Armenia currently imports Russian gas at $165 per 1,000 cubic meters, with an effective price of about $177.