Georgia: Winter Gas Gamble

After rejecting Russian gas, Georgia looks to Azerbaijan and Turkey for emergency supplies.

Georgia: Winter Gas Gamble

After rejecting Russian gas, Georgia looks to Azerbaijan and Turkey for emergency supplies.

Again nothing new,” said Tbilisi resident Malkhaz Gelovani, 56, after watching the latest news. “They make promises, but no real decisions have been made yet.”

Like everybody else in Georgia, Gelovani is waiting anxiously for the outcome of negotiations between Georgia, Azerbaijan and Turkey over gas supplies to Georgia this winter.

After the government in Tbilisi decided to reject Russian gas, which is doubling in price from the New Year, the three countries are negotiating about the provision of extra supplies from Azerbaijan’s Shah Deniz gas field in the Caspian Sea, a development of which started a month ago.

A Georgian government delegation led personally by President Mikheil Saakashvili arrived in Turkey on December 20 for talks over this issue. After the first round of discussions, Georgian energy minister Nika Gilauri commented only that Georgia would have gas on January 1.

“Today we pay all the fees and tariffs, and all families in Georgia have had light and warmth for the past two years,” Saakashvili told a press conference in Ankara. “We are not going to change our policy and return to the times of darkness and cold apartments. The Georgian government will do its utmost to ensure energy security for its country.”

In November, the Russian gas monopoly Gazprom said it would increase the price of gas for Georgia to 230 dollars per 1,000 cubic meters in 2007, which is more than double the amount Georgia paid in 2006 and the highest price among CIS countries.

Gazprom made it clear that the price would only be lowered if Georgia agreed to sell its main gas pipeline to the company.

Saakashvili called Gazprom’s decision “political, not commercial”, and insisted his country would refuse to buy gas from Russia and definitely not sell any of its assets to Gazprom.

Georgia’s main hope now lies in the South Caucasus pipeline running from Baku to the Turkish city of Erzerum via Georgia, which is still under construction. The pipeline is due to provide Georgia with 300 million cubic metres of gas for 63 dollars per thousand cubic meters in 2007. Turkey’s share for 2007 is 2.8 billion cubic metres, but the Turkish segment of the pipeline has not been finished yet, meaning it will be some time before the country is ready to start receiving gas from Azerbaijan.

As a result, Azerbaijan and Georgia plan to share Turkey’s portion of gas. After preliminary talks in Baku, it was announced that Georgia will receive 800 million cubic metres of the supplies meant for Turkey, in addition to its own share from Shah Deniz. However, this would still leave Georgia with a shortfall of 600-700 million cubic metres.

Some experts say that in the long run Turkish gas will cost Georgia no less than that from Russian.

“I hope Georgia won’t be left without gas, but, because it’s short of time, the government may have to agree to worse conditions,” energy expert Giorgy Khukhashvili told IWPR.

To meet the shortfall, Georgia has also been talking to Iran about receiving gas, thereby risking the disapproval of its main ally, the United States.

John Tefft, US ambassador to Georgia, told Georgian journalists that “a long-term strategic cooperation between Georgia and Iran in the gas field is unacceptable to the USA”.

Giorgy Khukhashvili warned that “getting involved with Iran is, in the current political situation, a risky move for Georgia”.

“Georgia has declared that its orientation is towards the European Union and NATO, which is why it must pay heed to recommendations given by its strategic partners. If Georgia has to choose - to buy gas from Iran or Russia at one and the same price, the preference should be given to the old headache, rather than the new one,” he said.

However, Paata Zakareishvili, head of the Development and Cooperation Centre, said that the Georgian authorities had stated clearly what the direction of their foreign policy was, and Washington should have no doubts on that score. “I think that Washington can close its eyes at some moves taken by Tbilisi under pressure,” he said.

Ordinary citizens have been following the talks closely. They are all too aware of what living without electricity and gas would mean, having endured darkness and cold for years after the country became independent in 1991. The situation has improved markedly since the Rose Revolution of 2003, but no one is relaxed about it.

Housewife Lali Dadunashvili said she knew “probably as much as the energy minister himself” about the gas talks. “I watch absolutely all the news broadcasts to know whether we are going to have gas or not. It’s frightening even to think what may happen to us this winter,” she said.

Lali lives in a two-room apartment together with her four children and husband. They warm themselves with a gas stove and use gas to heat their water as well. She recalls with horror the situation last January when explosions along the pipeline connecting Russia and Georgia left the country without fuel for weeks.

“We wore fur coats at home, we slept in our warm clothes and stood freezing in queues for kerosene for hours... God forbid this should happen again!” she said, adding she didn’t care where the gas came from - Russia or Iran, “just so long as there is some!"

Gocha, who sells gas stoves at the market, said his trade was brisk. “People are still buying gas stoves. Our president has promised we’ll have gas, and that means we’ll have it,” he said. “Why shouldn’t we believe him? We can do without Russian gas.”

But doctor Malkhaz Gelovani is angry with the government. “The authorities are promising that there will be no gas problem this winter, but that’s hard to believe. They’d better tell us the truth and explain why we are refusing Russian gas and what the winter holds,” he said.

Nana Kurashvili is a reporter for Imedi television in Tbilisi.

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