The Hindu Business Line : India, Pak see no stumbling block in executing gas pipeline project — Confident of finalising project structure by April '06

Industry & Economy - Petroleum

India, Pak see no stumbling block in executing gas pipeline project — Confident of finalising project structure by April '06

Our Bureau

New Delhi , Dec. 17

INTERNATIONAL pressure and negative feedback from the US notwithstanding, India and Pakistan today inched a step closer on working out Iran-Pakistan-India gas pipeline project's commercial and technical structure.

At the end of the third joint working group meeting, the two countries reiterated their commitment to the project and finalising various issues concerning it at the earliest.

Speaking to newspersons after the two-day meeting, Mr Ahmad Waqar, Secretary, Ministry of Petroleum and Natural Resources, Pakistan, expressed confidence that the construction of multi-billion dollar pipeline should begin by mid-2007, so that the first gas flows by the end of 2010. The two countries hoped that the project structure and the framework agreement would be finalised by April 2006.

`No stumbling block': "We don't see any stumbling block. We are moving ahead," Mr Waqar said. Brushing aside any reservations on the project, Indian Petroleum Secretary, Mr S.C. Tripathi, said, "India needs the project for its energy security and is moving on it as per the Prime Minister, Dr Manmohan Singh's advice."

Meanwhile, Iran has identified certain blocks of gas from which gas would be dedicated to the proposed pipeline project. Tehran has also agreed to international certification of reserves as desired by the two countries. Further, the Iranian side has also conveyed that it was in the process of preparing a development plan for these blocks and had invited India to participate in this development.

Gas share: Asked whether the two nations have agreed on the volumes of the gas, he said, that to begin with India would draw 60 million standard cubic meters per day (MMSCMD) from about 2,100-km pipeline project. This is expected to increase to 90 MMSCMD in next 2-3 years. On the other hand, Pakistan would initially need 30 MMSCMD, which is expected to rise to 60 MMSCMD in next 3-4 years, Mr Waqar said

The joint statement issued by the two countries said that Iran-Pakistan-India are expected to hold the first tripartite meeting in February 2006 in Tehran to address the issues relating to the project, including an integrated feasibility study, project structure and framework agreement. The next joint working group meeting between India-Pakistan would be held in early March 2006 at Islamabad.

Tech sub-group: Elaborating on the project structure, Mr Tripathi said, the structure would include how the project will be built and operated. Both the sides have agreed to set up a joint technical sub-group which would meet at least once in a month alternately in each country to discuss various technical aspects relating to the project such as technical specifications, the quantum of gas, build up, pipeline route, transportation tariff and system configuration, he said.

Regarding the issue of transit fees, which India would be required to pay to receive the gas, the two sides agree that they would approach the issue on the basis of `international best practices'. It was noted that there were various options available to determine transit fee, Mr Tripathi said, "There was preliminary exchange of views on the broad principles determining this fees, which would be finalised after other relevant aspects of the project."