Interfax June 18 2004 Yerevan. (Interfax) - Trade between Iran and Armenia as part of an agreement for the construction and operation of the Iran- Armenia gas pipeline, involving supplies of Iranian natural gas in exchange for Armenian electricity, will amount to $10 billion over the next 20-25 years, Iranian Ambassador to Armenia Mohammad Farhad Koleini said. He said that this agreement will not result in increased competition between Russia and Iran on the gas market, as these countries are not competitors, but partners. "We are cooperating with Russia in the international arena and our cooperation is not restricted to the Caucasus, and we do not see competition as a decisive factor. This is the Iranian model," the ambassador said. Koleini said that "in the energy sphere Russia needs to develop a serious model for cooperation with Europe and with Iran." The ambassador considers it possible to set up a consortium of large gas producing countries in the near future. He also said that in line with a state program, Iran is planing to build seven nuclear power plants in various regions in the country. "In this process Iran is cooperating with Russia and is continuing dialogue with European countries," the ambassador said. Armenia and Iran signed an agreement on May 13 for the construction of a pipeline between the two countries. The agreement is valid for 20 years, during which Iran is to supply its neighbor with up to 36 bcm in exchange for electricity produced in Armenia. The pipeline is 141 km long, inducing 41 km in Armenia ands 100 km in Iran. The total cost of the project is estimated at $210-$220 million, to be financed equally. Gas should start to arrive in Armenia from January 2007. Initially supplies will amount to 1.1 bcm of gas per annum, to subsequently increase to 2 bcm, which will be used at Armenian thermal power plants to produce electricity for export to Iran and Georgia.
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