Iran and Georgia strike gas deal amid crisis

Georgia struck a deal with Iran for emergency natural gas supplies, as the tiny US-ally suffered through its worst energy crisis in years and government officials accused Russia of waging an energy blockade.
"It‘s an energy blockade. That‘s what it is," said 58-year-old Bichiko Gveseladze, who waited six hours along at least 500 other people for government-subsidized kerosene. "Russia is doing it because they don‘t want Georgia to be fully independent."

Saakashvili, a pro-Western leader who has built close ties with Washington as he pursues his goal of ending Russian influence, told his Cabinet that Iran had agreed to supply gas via Azerbaijan.
"What else are going to do?" she said. "I believe in (Saakashvili), but I believe more in God."
"This is only political. All of this crisis," said Boris Khvibliani, a 65-year-old retired energy sector worker. "This is the 21st century. (Russia) wants everything. Enough already."

The deal signals Tbilisi‘s determination to reduce dependence on Russia -- the world‘s second largest oil exporter and Europe‘s largest supplier of natural gas -- and highlights Tehran‘s importance in the region as an alternative energy supplier. Some Georgian reports said Iran was asking $ 120 per 1,000 cm -- higher than the $ 110 Russia currently charges.
Underscoring the seriousness of the crisis, Saakashvili cut short a trip to the World Economic Forum in Switzerland -- where he was hoping to sell business elites on the country‘s economic prospects -- and flew home. Then, a Tbilisi power station unit malfunctioned, leaving most of the capital‘s 1.5 mm residents -- more than a third of the country‘s population -- to scrounge for other heating options as daytime temperatures fell to -18 degrees.

The 1991 Soviet collapse and civil war in the early 1990s left much of Georgia‘s energy infrastructure decrepit and in desperate need of repair, forcing many to rely on generators and wood- and gas-fired heaters and stoves.
In recent years, the situation had stabilized with fewer outages and Saakashvili, who came to power on the wave of the 2003 Rose Revolution, had restored optimism for many Georgians.

Georgia‘s closer cooperation with Tehran could lead to awkward questions from the United States, which is seeking Iran‘s referral to the Security Council for reopening its uranium enrichment program -- work that could give it the capacity to make nuclear weapons. Yet as relations with Moscow become increasingly strained, Georgia‘s energy options are limited, analysts say.
"What are the alternatives?" said Kakha Kiknavelidze of Brunswick UBS in Moscow. "Iran, or to be left without gas."