The Hindu Business Line : India-Iran gas pipeline pact by June: Deora

Hyderabad April 6 The India-Iran agreement for gas pipeline that traverses through Pakistan will be finalised by June 2007, according to the Union Minister for Oil and Natural Gas, Mr Murli Deora.

The modalities are being fine-tuned and issues related to pricing are being addressed.

It is important that the pipeline is viable and useful for the country's energy security, Mr Deora said.

Speaking at a function hosted by HPCL to launch ethanol-blended petrol, Mr Deora said that Turkmenistan is also emerging as a very attractive option for pipeline project.

Mr Deora, who was here with a strong contingent of officials from the Petroleum Ministry and oil sector companies, said: "There was no pressure from US on the issue.

"Our foreign policy is laid down by the Government and no one can influence our decisions."

On rising fuel prices, he said: "Despite high prices, we have managed to keep oil prices under check.

"About 70 per cent of the requirement is imported, causing a heavy drain on foreign exchange.

"However, we now have forex reserves of about $200 billion and we can handle such situations."

He added: "The Krishna-Godavari basin holds immense promise for the country's energy security and in the next two years we will have abundant supplies from the region, which will make it one of the important energy hubs."

The Union Secretary for Petroleum, Mr M.S. Srinivasan, said that the pricing of gas would be as per new exploration and sharing contracts; there is nothing preventing developers from entering into contracts.

Meanwhile, the Chairman and Managing Director of ONGC, Mr R.S. Sharma, has said that the company has reconsidered setting up of a greenfield refinery project at Kakinada.

Feasibility studies would be concluded within three months and stone laid for the project.

Against initial estimates of a 7.5-million-tonne project, considered unviable, ONGC has reworked its strategy and has come up with twice the size of the initially planned refinery.

It is planning a 15-million-tonne refinery complex, which would seek synergies from existing capacities and potentially entail an outlay of Rs 20,000 crore.

The Chief Minister, Dr Y.S. Rajasekhara Reddy, thanked Prime Minister Dr Manmohan Singh and the Petroleum Ministry for agreeing to go ahead with the project with expanded mandate.

He also urged the Petroleum Ministry to ensure that a gas pricing authority is in place to ensure that private players do not monopolise gas prices and impact consumer interest.

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