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17.04.2008

ENTRANCE OF THE IRANIAN GAS INTO EUROPE

   

Sevak Sarukhanyan

Europe_Iran (original)On March 17, 2008, in the capital of Iran, Teheran, was signed the first international contract empowering Iran to export natural gas to Europe. The contract was signed by the Iranian gas exporting national company and the Swiss Elektrizitaetsgesellschaft Laufenburg Company. According to the contract, within 25 years the Iranian party will provide the Swiss company with 5.5 billion cubic meters of gas per year beginning from 2009.

The foreign minister of Iran, M. Motakii, who was present at the contract signing process announced after negotiations with his Swiss companion M. Calmy Ray that he was present at an event of historical importance, which not only portended the entry of Iran into the European market, but also revealed the mutual interest that Swiss and Iran had. In her turn M. Calmy Ray mentioned that Switzerland didn’t have enough natural resources and that’s why it had to carry out more active and interested diplomacy and in this business Iran is a reliable partner.

Let’s mention that although the contract has been signed by the Swiss and Iranian companies, its realization has also been also actively participated by Turkey and Greece through the territories of which the Iranian gas will flow to Europe as well as Italy, the northern Swiss company of which will build a thermoelectric power station of 2 thousand megawatt power which will use the Iranian gas to generate electricity and export it into Switzerland.

It goes without saying that the contract signed should not be underestimated. It is important because of a number of reasons:

  1. The contract is the first document on long-term energy cooperation that Iran has signed within the last 30 years.
  2. In its relations with Turkey Iran achieved its object: Ankara refuses its formerly adopted position, according to which the Iranian party was to sell gas to Turkish companies at a low price and the Turkish companies were to resell it to European suppliers at a higher price. The Iranian-Swiss contract supposes that the territory and gas pipelines of Turkey will only be used for transit purposes, which is of Teheran’s interests.
  3. Iran becomes the participant of the realization of a new energy project in the territory of Europe. The matter concerns the contraction of a new Trans-Adriatic gas pipeline, which is to stretch to Italy through the seabed from Greece to Italy. Thanks to this very gas pipeline Iran will have a chance to take its gas to the European suppliers. For that country it is more than important the fact that in the beginning of April the UN commissar for energy issues considered the participation of Iranian companies in the construction works of the gas pipeline quite “natural”.

It is noteworthy that last year the Iranian authorities also carried negotiations with the authorities of Albania on possible energy cooperation. It is anticipated that in parallel with the construction of Trans-Adriatic gas pipeline will also be built another gas pipeline from Greece to Albania by means of which the Iranian gas can be exported to Albania and Balkans, which is a real challenge to the Russian “Gasprom” aiming at preserving its monopolistic position in the gas market of the Balkan Peninsula. According the foreign minister of Iran, M. Motaki, already in 2012 Iran will be able to pump 12 billion cubic meters of gas per year to Greece, a part of which will be purchased to the Swiss Elektrizitaetsgesellschaft Laufenburg and the other part will be sold to other consumers.

The Iranian-Swiss contract may be considered the demonstration of the practical realization of the winged expression “If the mountain will not come to Mohammed, Mohammed will go to the mountain.” It is already 10 years since the Iranian-European negotiations on energy cooperation problems have begun, however, political considerations don’t give the Europeans opportunity and freedom to come to agreement with the Iranians. Although the import of Iranian gas is of vital importance for Europe’s energy security, the European-Iranian relations mainly remain dependent on the Iranian-American ones. Although most of the French companies, including the oil “Total,” have been cooperating with Iranians for already several years, however, such examples are very few. And this may last as long as the Iranian-American conflict. And from this very standpoint the Iranian-Swiss contract is one of the main achievements giving the Iranians chance to animate energy ties with Europeans. By signing contract with the Swiss producers of electricity, they have a chance to enter the European Market and make their own way of exporting their gas to Europe.

Let’s mention that the EU foreign policy Chief Kh. Solana has considered the Iranian-Swiss contract to be “the internal business of the two countries,” the US department speaker has characterized it to be dangerous and the US ambassador to Switzerland has announced that it should be studied if the signature of the Swiss company put to the contract with Iran doesn’t contradict the requirements of the UN SC adopted resolution on the nuclear program. As one may notice, the EU and US approaches to the Iranian-Swiss contract are qualitatively different.

The factor of Armenia

However strange it seems, the Iranian-Swiss contract directly applies to Armenia. By signing the contract Iran has undertaken a very important liability, the realization of which may not be that easy. The Iranian-Turkmen tense relations have made Teheran supply the demand of those northern provinces of the country, which formerly used Turkmen gas on the account of its own gas resources. As a result, this winter the Iranian party had to limit to the gas supplied to Turkey in spite of the contract in force. Being the second in the world by its huge gas reserves, Iran doesn’t have means for developing its production, processing and exporting. In this sense, the contract signed with Switzerland will complicate fulfillment of commitments undertook by Iran to his partners. According to us, it also concerns the Iranian-Armenian gas pipeline. It is possible, that at this moment, when Iran hasn’t displayed high showings in gas production, its supply to Europe may influence on the stability of export in other directions.


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