Iran invites Bangladesh to join cross-border gas grid

[Contrarian]

Industrialization is directly related to energy. See the example of Bombay, Gujrat and Chennai. They have ports, they can import oil and gas easily, industries boomed there. I'm not talking about service industry here.

Not going for the IPI project wont mean that there would be an energy shortfall. The government is going gung ho on many projects for energy. Not the least being coal fired plants, coal being imported from other countries and nuclear plants which are going to come up in major numbers.

IPI is something we would like to have, not something we have to have. It would definitely be cheaper than other options, but as per what GoI says, Iran is charging an arm and a leg for the gas.

 

[TopCat]

what is the iranian offer on gas price?

 

[eastwatch]

India will have to join for Bangladesh to become a partner in this project.

But chances of Indian involvement are minimal given the fact that with the 123 nuclear deal, India has another way to secure its energy needs. With so much money being invested in nuclear power plants, it will be very difficult to invest money in costly cross border pipelines PLUS the $200 million transition fees that Pakistan will charge.

A $200 million annual fee to Pakistan is not that high if India imports only, say, a 1/2 trillion cft of gas every year. If 1000cft of gas costs $5, then the total value of import is $2500 million. Add another $200 to it as fees. It is not very high.

No country has ever fulfilled its power demand by nuclear power plant only. Considering the way Indian economy is growing, it will need gas and other sources of fuel. Apart from security issue inside Pakistan, the project may be viable for India.

But, if Pakistan charges $200 million fees, then how much India will charge Bangladesh is an issue to be pondered. If it is another $200 million, then India pays its fees to Pakistan from the payment it receives from BD.

How wonderful then it is for India, it can fry fish with the oil derived from fish, paying nothing in the process. Only BD will face problem in the IPI fees arrangement. BD may have to pay $200 million each to both Pakistan and India. This may not interest BD if it has to pay $400 million as only fees.

 

[TopCat]

A $200 million annual fee to Pakistan is not that high if India imports only, say, a 1/2 trillion cft of gas every year. If 1000cft of gas costs $5, then the total value of import is $2500 million. Add another $200 to it as fees. It is not very high.

No country has ever fulfilled its power demand by nuclear power plant only. Considering the way Indian economy is growing, it will need gas and other sources of fuel. Apart from security issue inside Pakistan, the project may be viable for India.

But, if Pakistan charges $200 million fees, then how much India will charge Bangladesh is an issue to be pondered. If it is another $200 million, then India pays its fees to Pakistan from the payment it receives from BD.

How wonderful then it is for India, it can fry fish with the oil derived from fish, paying nothing in the process. Only BD will face problem in the IPI fees arrangement. BD may have to pay $200 million each to both Pakistan and India. This may not interest BD if it has to pay $400 million as only fees.

I think the fees will be determined by the percentage amount of Gas BD will buy from the project. Dont think that BD does not have to pay Pakistan. Pakistan will charge BD as well. Considering the huge volume India will be consuming the total transit cost/volume will decrease significantly. We might use Hasina Madam's sweet talk to get the transit fee waived from Delhi or we might reciprocate by allowing India Myanmar pipeline free to Delhi. Win win for everybody.

 

[eastwatch]

We might use Hasina Madam's sweet talk to get the transit fee waived from Delhi or we might reciprocate by allowing India Myanmar pipeline free to Delhi. Win win for everybody.

I think international commercial projects are taken into hands independently and on its own merits. So, India has to pay a certain amount of fees to BD for its Burmese gas, and BD has to pay its fees to India for IPI gas. These are separate accounts.

By the way, demand in BD will be no less than 1 trillion cft per year in the long run. It means the purchasing and transmission prices added together will exceed $5 billion. India will certainly import at least double that amount.

India has already discovered a huge amount of gas at the tune of 50 trillion cft near Chilka Lake in Orissa. I think, after this discovery India backtracked from IPI. The goal was certainly to get some more milk out of Iranian offer.

Reserves that have been discovered in Chilka cannot be developed with immediate effect. But, it has given India a certain bargaining leverage in the negotiation table with Tehran.

 

[KSRaj]

I think international commercial projects are taken into hands independently and on its own merits. So, India has to pay a certain amount of fees to BD for its Burmese gas, and BD has to pay its fees to India for IPI gas. These are separate accounts.

By the way, demand in BD will be no less than 1 trillion cft per year in the long run. It means the purchasing and transmission prices added together will exceed $5 billion. India will certainly import at least double that amount.

India has already discovered a huge amount of gas at the tune of 50 trillion cft near Chilka Lake in Orissa. I think, after this discovery India backtracked from IPI. The goal was certainly to get some more milk out of Iranian offer.

Reserves that have been discovered in Chilka cannot be developed with immediate effect. But, it has given India a certain bargaining leverage in the negotiation table with Tehran.

India has indeed found huge gas reserves lately. But I havent heard of any such 'find' near the Chilka lake! I guess you are referring to the gas reserves found at the Krishna Godavari (KG) basin off the cost of Andhra Pradesh.