Friday, September 28, 2007

Iran - Pakistan - India Gas Pipeline Stuck in Quick Sand

We told you this was going to be tough*.

From Energy Bangla:

They call it peace pipeline. Iran Government embarked on serous efforts to promote higher gas export abroad since the discovery of giant South Pars Gas field in 1988. In 1995 Pakistan and Iran signed a preliminary agreement for construction of a natural gas pipeline linking the gas field in the Persian Gulf with Karachi, Pakistan’s main industrial port located at the Arabian Sea.

Iran later proposed an extension of the pipeline from Pakistan to India. This pipeline if implemented will not only meet India’s growing energy demand to a great extent but also will also benefit Pakistan from Iranian natural gas exports as Pakistan’s territory will be used as transit route. India initially opposed the idea mainly due to the historically traditional tense relations and rivalry. It came up with an alternate idea for development of a deep sea pipeline where no threat to security of resources would exist. From 2000 the three governments met at regular interval and advanced the initiative to a great distance. But not it seems India due to its changed relation with USA has started thinking otherwise.

India skipped a crucial official talk on the $7.4 billion IPI gas pipeline talk just concluded in Teheran. Iran called the meeting of the technical experts and lawyers from three countries to exchange views on the gas supply contract during Sept 24-26.Officials of three countries were expected to discuss the issues arising out of the technical and legal experts meeting on September 27.But due to absence of India major issues remained unresolved.

Earlier a top Iranian Petroleum Ministry official said, “There are crucial bilateral issues that need to be resolved first before we begin discussions on contractual issues on a trilateral platform”. He further said New Delhi and Islamabad had reached understanding on transportation tariff payable for wheeling natural gas through 1035 –Km pipeline segment in that country.

But explaining the reasons of abstaining from the meeting one Indian official said, “We have communicated to Iran’s Petroleum ministry’s special representative H Ghanimi Fard and Pakistan’s Petroleum Secretary Farrakh Qayyum that we will not be attending the trilateral meeting unless the bilateral issues are resolved with Pakistan Incidentally , a bilateral meeting of officials from India and Pakistan scheduled to be held in Islamabad in August this year was also called off at the last moment as India cancelled appearance citing pressing urgencies at home. Many in India believe India has become a little bit puzzled due to strong US reservation about the pipeline and to some extent Indian government tends to succumb to U.S pressure. Pakistan on the other hand appears to remain committed to the pipeline till now. But it is to be seen how it absorbs U.S pressure eventually. But it’s spokesman said it will initiate bilaterally the multibillion dollar gas pipeline project if India does not agree upon it.

Tasnim Anam further said Pakistan is still committed and sincere to the Iran-Pakistan –India (IPI) gas pipeline project. IPI is very important project as Pakistan needs energy to fulfill its future. Pakistan’s economy is growing while energy requirements are increasing and the country is facing shortage of energy. Pakistan is firm to follow the IPI project even without India. Pakistan will do it with Iran.

India is now in serious dilemma....MORE

Tuesday, July 17, 2007

*Iran, Pakistan, India Agree Gas Price For Transnational Pipeline

Iran, Pakistan and India have agreed on a formula for the price of natural gas to be pumped through a pipeline that will link the three countries, India's Asian Age daily said. The deal has removed the main obstacle to the signing of a three-way agreement on building the 2,300 km Iran-Pakistan-India (IPI) pipeline with an estimated price tag of $7.5 billion. The first deliveries from gas-rich Iran are expected in 2011.

If you ever thought your negotiations were tough...