A senior Iranian official said on Monday that negotiations are being held to build a $4.5 billion undersea gas pipeline from Iran to India following New Delhi’s rejection of the proposal for an on-land pipeline that would pass through Pakistan.
“Negotiations are under serious consideration,” said National Iranian Gas Export Company managing director Alireza Kameli at the World Energy Policy Summit in India.
Necessary approvals and agreements for gas sale and purchase are yet to be signed, the official said. The pipeline from the Iranian coast via the Oman Sea and Indian Ocean to Gujarat will likely to be built in two years and will carry about 31.5 million standard cubic metres gas per day.
“We welcome India’s participation. At the moment, Iran is in negotiations with South Asia Gas Enterprise (SAGE) for construction of an undersea line,” Kameli said.
Further, according to the proposal which is currently under scrutiny, SAGE will lay a 1,400km pipeline bypassing the exclusive economic zone (EEZ) of Pakistan. Companies wishing to buy gas from Iran will have to rent the pipeline.
“SAGE will not be buying gas from Iran. It will lead to an international consortium for building the pipeline,” Subhodh Kumar Jain, director of the New Delhi-based SAGE said, while adding that SBI Caps is advising them on the project.
India has not participated in talks on the 1,036km Iran-Pakistan-India ((IPI)) gas pipeline since 2007, owing to security and commercial threats.
Referring to the IPI project earlier, Assocham Secretary General D S Rawat remarked that the proposed pipeline projects involving Pakistan may not materialise due to the critical political situation.
“Given the kind of serious political problems, the proposed pipeline projects involving Pakistan, it is feared, may remain a pipe dream. All other viable alternatives to enhance India’s energy security must be explored,” he said.
The consortium of Indian public sector companies, ONGC Videsh, Oil India and India Oil Corporation, had discovered gas in the Farzad-B block in Iran in 2008 and subsequently, prepared a field development plan to recover about 12.8 trillion cubic feet of gas. However, according to Assocham, the plan had to be abandoned following sanctions on Iran. India has already spent $90 million on exploration.
This article originally appeared on The Hindu
