“Iran has produced a formula for determining (the) gas price at the Iran-Pakistan border. Two other issues, namely transportation tariff and transit fee, are under discussion between India and Pakistan,” Mr Patel is quoted as saying. “Once these issues are decided, the price of gas at (the) Pakistan-India border would be known and then, a decision on the purchase of gas through Iran-Pakistan-India pipeline project will be taken,” he said.
Iran, Pakistan, and India are planning the 2,600-km gas pipeline at an estimated cost of $7 billion which, if built, is expected to handle 150m cum/d. The project was first proposed by Iran about a decade ago. In Iran, the route will run up to the Iran-Pakistan border and the pipeline will be laid and operated by an agency yet to be nominated by Iran. Iran has offered to sell gas at the Iran-Pakistan border, and will take responsibility for the safety and security of the pipeline within Iran.
The safety and security for the pipeline and gas within Pakistan would be provided by the Pakistani government, for which a transit fee would be levied. “Discussions on all these issues are continuing,” Mr Patel said. The pipeline faces opposition from countries (including the US) who oppose any business deals with Iran. However, the Iranian government wants to develop outlets for its vast gas reserves, estimated at 812t cuft. If the project goes ahead, India could initially buy up to 60m cum/d of gas from Iran, while Pakistan could buy as much as 30m cum/d.
Indian officials say that, if an agreement is reached, the pipeline could become a reality by 2012. According to the latest estimates, by 2025, India’s gas demand will more than double to 400m cum/d from the current approximately 150m cum/d.