Turkey Agrees to Give Georgia Part of Pipeline Gas Quota – Agency

Text of report by Georgian news agency Prime-News

Tbilisi, 6 October: Turkey has agreed to allocate to Georgia an additional amount of natural gas from the Baku-Tbilisi-Erzurum pipeline [under construction]. The Georgian governmental delegation led by Prime Minister Zurab Noghaideli, which is visiting Turkey, has received Ankara’s preliminary consent, Prime-News learnt from the prime minister’s staff.

According to the preliminary agreement, Turkey will cede a part of its own quota of gas from the pipeline to Georgia. The prime minister’s staff said that Zurab Noghaideli and Energy Minister Nika Gilauri reached this agreement at their meeting with Turkish Prime Minister Recep Tayyip Erdogan.

Starting from 2006, when the pipeline construction is completed, Georgia will be receiving five per cent of transported gas for free as a transit payment. Georgia will also be allowed to buy an additional amount of gas at the privileged price of 55 dollars per 1,000 cubic metres.

The pipeline is expected to have an annual throughput capacity of 30bn cubic metres. According to expert estimates, in 40 years Georgia will have received 50bn cubic metres of gas for free and 8.8bn cubic metres of gas at the privileged price. This is equivalent to saving 7bn dollars in 40 years or 175m dollars a year.