Change of guard in Iran not to affect gas pipeline project

Iran on Thursday made it clear that the recent regime change in the country would have no bearingon the proposed Iran-Pakistan-India gas pipeline.

Work on the much-delayed 7.4 billion US dollars tri-nation project is likely to commence from 2007.

"This is a strategic project for Iran. I don't think there will be any change in policy as far as this project is concerned,"Iranian Deputy Oil Minister M H Nejad Hosseinian said in New Delhiafter the conclusion of the two-day Joint Working Group (JWG) meeting in New Delhi.

Hosseinian said that India has indicated a requirement of 90 million standard cubic meters per day (mmscmd) of gas while Pakistan needs another 60 mmscmd. On the other hand, India is likely to join a consortium involving Iran and Pakistan to build the project.

During the meeting, India made a climb down from its earlier position that it would take delivery of gas at Indian borders.

"We will have no control over the price of gas if we were to merely sit on the fence and be just a buyer. We need to get involved with the project. Besides, we can ensure security of the pipeline in a much better way once we are part of the consortium operating the pipeline; an Indian Government official said.

India is believed to have told Iran that it would go to the Cabinet for an approval for joining the project consortium once the three countries decide on the project framework by end of 2005.

The official said in all probability two pipelines would be laid, as a single 56-inch line would not be enough to meet the energy demand in India and Pakistan.

India and Pakistan have expressed higher requirement than the capacity of the 56-inch pipeline. The pipeline would have a capacity to carry only 120 mmscmd gas.

According to Talmiz Ahmad, Additional Secretary (international cooperation) in India's Ministry of Petroleum and Natural Gas, India and Pakistan will by the month end or early September appoint separate financial consultants to suggest project structure and address technical, financial, commercial and legal aspects to make the project safe and secure.

An Indian technical team would visit Tehran in the third week of this month to review the pre-feasibility report prepared jointly by National Iranian Gas Export Co and BHP Bhilliton.

Iranian Deputy Oil Minister also said a project structure, (if the three countries would build separately the parts of the pipeline falling in their country or a consortium of Indian, Pakistani and Iranian companies along with international firms would build and operate the pipeline) would be in place by early November.

"Once there was agreement on the project structure between thethree countries, the trilateral framework agreement would be finalized by the end of the current year, a joint statement released after the JWG said.

Source: Xinhua