Date:12/11/2007 URL: http://www.thehindu.com/2007/11/12/stories/2007111254031300.htm

International - India & World

Pakistan eager to transfer gas to India, China

Atul Aneja

Stage set for multi-billion dollar deal

India had opted out of talks on the issue of transit fees
Price formula for gas exports to be reviewed in 2015

DUBAI: Islamabad is determined to import gas from Iran, Iran’s Petroenergy Information Network (PIN) quoted Mukhtar Ahmed, energy adviser to Pakistan Prime Minister Shaukat Aziz, as saying. Besides, Pakistan was eager to transfer the gas to India and China.

Iran and Pakistan finalised their gas pipeline contract on Saturday, setting the stage for the signature of the multi-billion dollar deal.

2,600 km pipeline

India opted out of the last few rounds of the official-level dialogue on the Iran-Pakistan-India (IPI) gas pipeline saying that it would go ahead with these talks after negotiating an understanding with Pakistan on transit fees.

The three countries have been discussing the transfer of gas from Iran’s South Pars field to Pakistan and India across a 2,600-km pipeline.

No hitches

“We faced no obstacle during negotiations and all articles of the peace pipeline contract were smoothly restudied,” Mr. Ahmed said.

The Pakistani adviser said the two sides were now working on an annexure that would be added to the contract in one month.

Iran’s chief negotiator on the IPI gas pipeline Hojjatollah Ghanimifard said the annexure would include an “operational agreement.” This would revolve around technical issues such as gas pressure at the point of delivery and identification of the border point for the transfer of gas.

Both sides agreed that the price formula for gas exports would be reviewed in 2015.

Mr. Ahmed was quoted as saying that Pakistan prioritised its contract with Iran ahead of other gas import options. He pointed out that the Pakistani government would study possible gas imports from Qatar and Turkmenistan after the peace pipeline project with Iran had been finalised.

TAPI pipeline

Analysts point out that while the Americans oppose the construction of the IPI gas pipeline, they are unlikely to object on political grounds the construction of the proposed Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline.

Mr. Ghanimifard explained that Iran saw the IPI project as part of a larger gas export architecture serving Asia. He said the IPI gas pipeline would serve “some part” of the Asian market. Export of Liquefied Natural Gas by sea would meet the additional demand.

The Iranian official stressed that Pakistan welcomed the transfer of Iranian gas to India, China, and “any other point” through its territory.

Iran was also looking at exporting gas from South Pars to Europe via Turkey. Pakistan had also expressed interest in an energy partnership with Tehran and Ankara.