Azerbaijan: SOCAR Eyes Tbilisi's Gas Network

Azerbaijani and Georgian news sources have named the State Oil Company of the Azerbaijani Republic (SOCAR) as a potential buyer for Tbilisi's natural gas grid. The owner of the network, KazMunaiGaz -- Kazakhstan's national energy company -- plans to sell the floundering business.

SOCAR has not confirmed reports of negotiations with the Georgian and Kazakhstani sides, but said that entering Georgia's domestic gas supply market would help deepen energy ties between Baku and Tbilisi, the Day.az news website reported.

In a bid to reduce its dependency on Russian gas, Georgia entered into an agreement with Azerbaijan in December 2008 that renders SOCAR its leading supplier of household and power station gas. Makhir Mamedov, the head of SOCAR Energy Georgia, told Day.az that Azerbaijan supplies gas to Georgia's local gas distributors at the premium price of $167 per 1,000 cubic meters.