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Iran, India to discuss peace pipeline deal next week

Oil&Gas Materials 27 April 2013 22:56 (UTC +04:00)

Azerbaijan, Baku, Apr.26/ Trend R.Zamanov/

Iranian Oil Minister Rostam Qasemi will visit New Delhi next week to discuss peace pipeline project with his Indian counterpart.

The two sides are scheduled to talk about the gas price and pipeline's security, the Fars News Agency reported.

Indian Minister of Petroleum and Natural Gas Veerappa Moily had said in March that India is negotiating with Iran and the United States to join the peace pipeline project said.

Moily confessed that the pipeline project was beneficial for India, the Indian media reported.

The peace pipeline project was originally imitated to be built between Iran and Pakistan. Later India expressed an interested in joining this project.

The Iran-Pakistan gas pipeline projected to cost 1.2-1.5 billion dollars, would enable the export of 21.5 million cubic meters of Iranian natural gas to Pakistan on a daily basis.

The pipeline stretches from the border between the two countries to the Navabshah region in Pakistan, and covers 781 kilometres of its total length of 1881 kilometres.

The Iran-Pakistan gas pipeline's construction plan was officially started on March 11.

Iran plans to extend its seventh cross-country pipeline from the South-western port city of Assaluyeh to the south-eastern city of Iranshahr and from there to the Pakistan border. By extending the pipeline, Iran can also supply gas to its eastern provinces.

An Iranian contractor will lay some 780 kilometres of pipeline over the Pakistan soil in 22 months, he said.

Iran and Pakistan have devised a plan to finance the gas pipeline on Pakistan's side without the need for Islamabad to transfer funds to Tehran.

Based on the agreement, Tehran will grant a $500 million loan to the Tehran-based Tadbir Energy Development Group which is responsible for laying a pipeline in Pakistan under the multi-billion dollar project.

In the first phase, Iran will lend 250 million dollars and extend assistance later to 500 million dollars.

Pakistan will pay back Iran's $500 million loan after peace pipeline's inauguration. The pipeline is projected to come on stream in 2014.

The Iran-Pakistan gas pipeline projected to cost 1.2-1.5 billion dollars would enable the export of 21.5 million cubic meters of Iranian natural gas to Pakistan on a daily basis.

Iran has already constructed more than 900 kilometres of the pipeline on its soil.

Discussions between the governments of Iran and Pakistan started in 1994. A preliminary agreement was signed in 1995. This agreement foresaw the construction of a pipeline from the South Pars gas field to Karachi in Pakistan.

Later Iran made a proposal to extend the pipeline from Pakistan into India. In February 1999, a preliminary agreement between Iran and India was signed.

In April 2008, Iran expressed interest in the People's Republic of China's participation in the project. In August 2010, Iran invited Bangladesh to join.

In 2009, India withdrew from the project over pricing and security issues.

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