US Ambassador: “Georgia should care about energy diversification”

The US Ambassador to Georgia Ian Kelly believes Georgia should not be dependent on one source of energy.

Today, Kelly commented on Georgia’s energy challenge, which is the natural gas supply deficit, and said Georgia should care about the energy diversification.

It is always important that the energy policy of the Government be transparent. They are quite open with us, and we expressed our position, that they should not become dependent on one source of energy and maintain diversification. Their explanations satisfied us,” Kelly said.

The US Ambassador to Georgia also commented on receiving the extra gas supplies from Russia.

Georgia has a short-term energy supplies, and I think it is a prudent step to speak with potential energy suppliers. Of course, we are concerned about the occupation of Georgian territories by Russia, but the Government, I think, understands these challenges,” Kelly said.

What energy challenges does Georgia face?

Georgia’s energy challenges became a very active topic of discussions several months ago when the country’s Energy Minister declared Georgia "may not be able to receive enough natural gas from Azerbaijan” and that Georgia needed to "look for alternative sources of energy”.

Responding to such comments President of Azerbaijan Ilham Aliyev said Azerbaijan had "enormous deposits of gas”.

We can supply gas not only to our neighbors, but also to all of Europe for a hundred years,” said Aliyev during a joint press conference with Georgian President Giorgi Margvelashvili on November 5, 2015.

Georgia’s Energy Minister further explained that the problem was not regarding Azerbaijan’s gas supply but with the capacity of two pipelines through which Georgia receives gas from Azerbaijan.

Meanwhile, large Russian energy company Gazprom offered Georgia to fill the natural gas supply deficit with Russian gas. Kaladze met the Russian company’s CEO, Alexey Miller who said after the meeting with Georgian officials that his company was interested in increasing supplies of gas to Armenia via Georgia. However, Miller also said Gazprom was prepared to sell gas to consumers in Georgia itself.

How to fill the natural gas supply deficit?

Last week Kaladze also hosted the Director General of SOCAR Energy Georgia, Mahir Mammedov, in Tbilisi to discuss the possible ways for avoiding natural gas supply deficit.

After the negotiations with SOCAR, Georgian side decided to implement several projects together with Azerbaijani partners.

One project was about constructing an underground natural gas storage facility in Georgia.

Another project was about increasing the existing capacity of SOCAR gas transit and upgrading the SOCAR’s natural gas pipelines.

And the third project was related to the Shah Deniz gas field in the Caspian Sea, offshore from Azerbaijan, that opens Europe for Azerbaijani gas.

The Energy Minister explained technically it was impossible to receive additional supply of gas from Azerbaijan this year. However after implementing the above mentioned projects Georgia would overcome the natural gas supply deficit challenge.

Kaladze also explained extra gas supplies from Russia and Iran could be necessary only in a transition period until Azerbaijan’s Shah-Deniz field begins having an impact in 2019.

Meanwhile, Georgia’s former Energy Minister Davit Mirtskhulava posted on his Facebook page that Georgia "really faces natural gas supply deficit”.

Azerbaijani side was aware of Georgia’s natural gas supply deficit. There are numerous materials at the Gas Corporation [Georgian Oil and Gas Corporation] proving that supply could not meet the demand,” posted Mirtskhulava.

The former Energy Minister said Georgia was always receiving Russian gas to overcome the natural gas supply deficit challenge.