Oil and Gas

Russia may supply gas to Georgia rebel region

MOSCOW (Reuters) - Russia is looking into building a gas pipeline to Georgia’s breakaway Abkhazia region, a proposal likely to alarm Western governments who say Moscow’s support for the separatists risks stirring up tensions.

The idea is also almost certain to anger aspiring NATO member Georgia, which accuses Moscow of trying to annex the Black Sea region and views as illegal any business dealings with the separatist administration.

"There is an idea of building a gas pipeline to Abkhazia directly from Russia but no decision has been taken so far. It is just being studied," an official with Russia's state-controlled gas firm Gazprom GAZP.MM told Reuters.

Abkhazia, a territory on the Black Sea coast, threw off Tbilisi’s control in a separatist war in the early 1990s. It runs its own affairs, with support from Moscow, but no state has recognized its independence from Georgia.

A spokesman for Abkhazia’s separatist leader confirmed that discussions were underway. “So far this is just a draft plan,” he said.

Speaking on a visit to Berlin on Wednesday, Georgian President Mikheil Saakashvili said Gazprom intended to explore for oil in Abkhazia. He described that as “an absolutely outrageous violation of any international commercial law”.

But the Gazprom official said: “As far as oil is concerned, we know nothing about it.”

A spokeswoman for Gazprom's oil arm, Gazprom Neft SIBN.MM, said Saakashvili must be mistaken. "We are not working or exploring in Abkhazia for oil and there are absolutely no plans to do that in the foreseeable future," the spokeswoman said.

Abkhazia is a constant source of friction between Georgia and Russia in a volatile belt of land between the Caspian Sea and Black Sea which is emerging as a vital corridor for pumping oil and gas en route to world markets.

This year, Russia established semi-official ties with the separatists and sent extra troops to Abkhazia to beef up a peacekeeping contingent there.

Georgia’s Western allies urged Moscow to reverse the decision, saying it was not helping to calm tensions.

Western diplomats said the conflict came close to spilling over into a new war earlier this year. The United Nations said in one incident a Russian air force jet shot down an unmanned Georgian spy plane, though Moscow denied involvement.