The Hindu Business Line : Cabinet nod for Oil Ministry to negotiate gas pipelines

THE Union Cabinet has authorised the Petroleum Ministry to negotiate directly with Iran, Pakistan, Bangladesh and other countries for facilitating the laying of transnational pipelines for import of natural gas to India.

"It will significantly enhance oil security of the country," the Union Petroleum Minister, Mr Mani Shankar Aiyar, said after the Cabinet meeting here on Wednesday.

The decision was taken in the wake of a stand adopted by the Ministry for External Affairs that it was the nodal agency to deal with other Governments.

However, the Petroleum Ministry was of the view that it should be allowed to deal directly with other Governments in the hydrocarbon sector since during negotiations the Energy or Petroleum Ministers of these countries were involved.

As per the decision, the Petroleum Ministry will lead/participate in bilateral/multilateral negotiations for facilitating the laying of pipelines for import of natural gas.

"To sustain higher economic growth of 7-8 per cent per annum, it is imperative to look for cost-effective and long-term arrangements to meet our energy requirements," Mr Aiyar said.

Petroleum Ministry officials say that the Cabinet decision would go a long way in finalising a decision on a natural gas pipeline.

India has been holding discussions with Iran, Myanmar, Bangladesh and Turkmenistan for laying a pipeline to import natural gas.

Pakistan has been keen on the Iran-India pipeline project for years, but political tensions between the two neighbours had hampered progress.

Mr Aiyar said while the pipeline from Iran would pass through Pakistan, it would pass through Afghanistan and Pakistan when originating from Turkmenistan and through Bangladesh when sourced from Myanmar.

Huge demand-supply gap

He said 50 per cent of the country's gas requirements and 85 per cent of oil demands were met through imports.

According to estimates, demand for natural gas in India is 150 million standard cubic metres per day but the current availability is only about 83 million standard cubic metres both from domestic sources and imported LNG.

"If the pipeline project is implemented, it would reduce the large deficit between demand and supply of natural gas and would increase energy security in terms of availability as well as affordability," he added.

Nod for Ahmed: The Cabinet approved the appointment of Indian Foreign Service officer Mr Talmiz Ahmed as Additional Secretary (overseas operation) in the Petroleum Ministry. Mr Ahmed was Additional Secretary (Administration) in the Ministry of External Affairs.

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