15 May 2007 - 14:57
  • News Code: 104727

Discussions between Iran, Pakistan and India over gas supply through the proposed pipeline are close to completion, an Indian official said.

The talks now hinge on agreement over the tariff to be charged by Pakistan for gas transported through its section of the pipeline for delivery at the Indian border, according to India"s Minister of Petroleum and Natural Gas Murli Deora.


Speaking exclusively to MEES in Riyadh last week, Diora said he did not expect there to be any major delays in signing a full sales and purchase agreement. “The commercial agreement is nearly complete - we are working very sincerely,” he said.


Diora said Pakistani Prime Minister Shaukat Aziz had assured the Indian government during his early-April visit to New Delhi that Pakistan"s tariff charges for Iranian gas to be supplied to India would in line with international norms.


Asked how much India was prepared to pay for Iranian gas, Diora said the long-term nature of the sales contract would allow a price “around the $5 per one million BTU” level.


“We are working it out now. It"s a long-term agreement and it should be at a correct price. A price of $6 per one million BTU is definitely too high,” he said.


The tripartite pipeline, also known as the peace pipeline, is a proposed 2,775 km gas pipeline project to deliver natural gas from Iran to Pakistan and India. The project is expected to take three to five years to complete and would cost $7 billion.


The project is expected greatly benefit both India and Pakistan which do not have sufficient natural gas to meet their rapidly increasing domestic demand for energy. India is predicted to require 400 million cubic meters of gas per day by 2025, up from 90 million cubic meters per day in 2005.


The project was conceptualized in 1989 by Ali Shams Ardakani and R. K. Pachauri. Ardakani is a former top diplomat and deputy minister of mines and metals of Iran. Pachauri proposed the plan to both the 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, Ardakani backed Pachauri"s proposal.


The pipeline is proposed to start from Asalouyeh, a port city in southern Iranian province of Bushehr, stretching over 1,100 kilometers in Iran itself. In Pakistan, it will pass through Baluchistan and Sind.



News Code 104727

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