Sunday, January 4, 2009

Iran–Pakistan–India gas pipeline

The proposed tri-nation gas pipeline will bring much-needed natural gas to several Indian and Pakistani cities.

The Iran–Pakistan–India gas pipeline, also known as the IPI pipeline or the Peace pipeline, is a proposed 2,775-kilometre (1,724 mi) pipeline to deliver natural gas from Iran to Pakistan and India. Iran is interested to also include the People's Republic of China to this project.[1] The project is expected to greatly benefit India and Pakistan, which do not have sufficient natural gas to meet their rapidly increasing domestic demand for energy. India is predicted to require 146 billion cubic meters (bcm) of gas per annum by 2025, up from 33 bcm per annum in 2005.[citation needed]


[edit] History

The project was conceptualized in 1989 by Rajendra K. Pachauri in partnership with Ali Shams Ardekani, former Deputy Foreign Minister of Iran. Dr Pachauri proposed the plan to both Iranian and Indian governments in 1990. The Government of Iran responded positively to the proposal. At the annual conference of the International Association of Energy Economics, 1990, Dr Ardekani backed Dr Pachauri's proposal.[citation needed]

The deal reached a setback on July 16, 2006, when Iran demanded a price of US$7.20 per million British thermal unit (US$6.80/GJ) of gas against India's offer of US$4.20 per million British thermal unit ($4.00/GJ). The Indian spokesperson stated that the price offered by Iran was more than 50% above the prevailing market price in India.[2] India and Pakistan finally agreed in February 2007 to pay Iran US$4.93 per million British thermal units (US$4.67/GJ) but some details relating to price adjustment remained open to further negotiation.[3] The long-stalled talks made a breakthrough in April 2008 when Iranian President Mahmoud Ahmadinejad made whistle-stop visits to Pakistan and India.[4]

India, Asia’s third-largest economy, can produce only half the gas it needs to generate electricity, causing blackouts and curbing economic growth.[5] The Indian government has called for trilateral talks on the project in July 2008. The 2008 Pakistani general election has created a new Petroleum ministry in Pakistan which would be invited for the talks.[6]

[edit] Route

The pipeline is proposed to start from Asalouyeh and stretch over 1100 kilometres through Iran. In Pakistan, it will pass through Baluchistan and Sind.[7]

[edit] Technical description

The pipeline will be supplied from the South Pars field. The initial capacity of the pipeline will be 22 bcm of natural gas per annum, which is expected to be raised later to 55 bcm.[8] It is expected to cost US$7.5 billion.[4] The construction is to start in 2009 and the pipeline is expected to be completed in September 2012.[9] India has agreed to give Pakistan a transit fee of $200 million per year, which is equivalent to $0.60 per million British thermal unit for allowing passage of the pipeline through that country.[10]

[edit] See also

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