YEREVAN — Armenian officials say Russian energy companies have pledged to invest a total of 26.7 billion drams ($71.2 million) in the natural gas and electricity distribution networks they own in Armenia in 2011, RFE/RL’s Armenian Service reports.
The Public Services Regulatory Commission (PSRC) approved and publicized the Russian companies investment plans at a regular meeting on June 16 in Yerevan.
In a statement, the PSRC said the Electricity Networks of Armenia (ENA) will spend 18.2 billion drams on upgrading and expanding its power distribution facilities and boosting the safety and reliability of electricity supplies to consumers.
ENA’s parent company is a subsidiary of Russia’s RAO Unified Energy Systems (UES) power giant.
The Armenian network incurred massive losses before being sold by the government in 2002 to Midland Resources, an obscure British-registered firm. UES acquired it in 2004.
ENA, which is one of Armenia’s largest corporate taxpayers, has undergone significant restructuring and received sizable capital investments since then.
It has become increasingly profitable in recent years despite a reduction in domestic electricity production. ENA profits jumped by 50 percent to 25.1 billion drams last year.
According to the PSRC, another 8.5 billion drams is to be invested in the national gas network operated by the ArmRosGazprom (ARG) company. Eighty percent of its stock is owned by Russia’s Gazprom gas monopoly.
The PSRC statement said ARG plans to upgrade its network and expand a massive underground gas storage facility located near Yerevan. The gas operator’s investment commitments for 2011-2013 total 17.8 billion drams.