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Iran, Pakistan, India to Finalize Pipeline Pact February - Pakistan

Posted on: Sunday, 1 January 2006, 12:00 CST

Text of report by Pakistani newspaper Dawn website on 1 January

Islamabad, 31 December: Pakistan, Iran and India will finalize in February a tripartite framework agreement and consider project structure and detailed feasibility study of the 7bn dollar Iran- Pakistan-India (IPI) gas pipeline plan, a senior government official said.

Petroleum Secretary Ahmad Waqar told reporters here on Saturday [31 December] that the IPI [Iran, Pakistan, India] gas pipeline project was progressing satisfactorily and petroleum secretaries of the three countries would meet in Tehran to take up three issues. The meeting would finalize a tripartite framework agreement, project structure and launch a detailed feasibility study, he said.

He said Iran has proposed that each country should construct the pipeline in its respective territory, whereas another proposal was to lay the whole pipeline as an integrated project from the gas field in Iran to distribution points in Pakistan and India. Mr Waqar said Pakistan's Interstate Gas Company Ltd (IGCL) has appointed Pricewaterhouse Coopers as financial adviser to propose a best possible structure of the project from Pakistan's point of view.

Replying to a question on US opposition to the project, the secretary said that he could not comment on the political aspect of the project, but technically the project was essential for the growing energy needs of Pakistan and India. He said Islamabad had sent a gas pricing formula to Tehran based on the mechanism in Pakistan.

He said the best international practices had to be adopted in determination of the transit fee. About security of the pipeline, he said risk mitigation measures and insurance were always part of such projects. About the project cost, he said a figure of 7bn dollars has emerged but a final situation would depend on material used for the gas pipeline.

The petroleum secretary said a steering committee meeting of Turkmenistan-Afghanistan-Pakistan (TAP) pipeline project was also expected to be held in the last week of January. The meeting, he said, would consider gas reserve certification of Turkmen gas and the quantity of the gas dedicated for the TAP project for 25-30 years.

Responding to a question as to why the Qatar pipeline project seemed dormant, he said Pakistan had been invited to a joint working group [JWG] meeting in Dubai but the government proposed that the meeting should be held in Islamabad. It is hoped that dates are finalized shortly for the JWG, he said.

Source: BBC Monitoring South Asia

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