Page 35 - GEORptMay18

9.0 Industry & Sectors 9.1 Sector news
9.1.1 Oil & gas sector news
The Georgian government approved in January an annual energy assessment that effectively makes Azerbaijan, Georgia's neighbour, the monopolist gas exporter to the country, a report by the Jamestown Foundation published on February 12 reveals. According to Georgia's approved 2018 energy balance, the country will purchase from its southern neighbour 2.6bn cubic metres (cm) of gas, or 99.65% of the country's estimated gas needs this year. This development is significant in light of a controversial renegotiation of Georgia's gas transit deal with Russia's Gazprom in 2016-2017. At the time, Gazprom sought to renegotiate the transit fee it paid Georgia for the transport of Russian gas to Armenia. Instead of paying Tbilisi 10% of the gas, the Russian company wanted to swap the transit fee for money. Georgia's relations with Russia have been plagued by tensions ever since a brief war between the two countries in 2008. In the energy sector, the war prompted Tbilisi to stop importing Russian gas and to turn to Baku for the commodity. In the end, Georgia agreed to be paid in money starting in 2018 and Gazprom agreed to sell Tbilisi gas at a discounted price when it needed it. Concurrently, Georgia has promoted domestic energy production from clean and renewable sources such as hydropower, wind and solar energy in order to diminish its dependence on foreign gas imports.
The European Investment Bank (EIB) has approved €1.5bn of financing for the Trans-Adriatic Pipeline (TAP), which will carry gas from the Caspian to southern Europe. The EIB decision, made by its board on February 6, follows heavy pressure from environmental groups who argued that the development bank should avoid investing in major fossil fuel projects. The pipeline, currently under construction, is a key part of the Southern Gas Corridor. It is intended to connect to infrastructure carrying gas from Azerbaijan’s giant offshore Shah Deniz II field to the Turkish-Greek border and on across Greece, Albania and the Adriatic Sea to southern Italy. The EIB funding was approved by the bank’s board along as part of a total of €6.5bn in of new financing for 36 projects in 17 EU countries and as well as projects in Africa, Asia and Latin America. The bank said its decisions reflected the “EIB’s commitment to support both renewable energy and strengthen security of energy supply”. Its February 6 statement noted that the TAP project was a strategically important component within the EU’s energy policy. Several environmental groups have criticised the EIB’s decision to fund TAP, claiming in a joint statement that the Southern Gas Corridor “could be as emissions-intensive or even more so than coal power” and detrimental to the EU’s efforts to cut greenhouse gas emissions.
9.1.2 Transport sector news
The Georgian capital of Tbilisi will add 100 new buses to its public transport fleet this year and will restructure its route plan thanks to an agreement with French consultancy Systra, the city hall has announced.
35 GEORGIA Country Report May 2018 www.intellinews.com