Iran-Pakistan Gas Pipeline (IPP) News & Updates.

[Hyde]

Zaki I always respect your views.. but here I need some serious inputs like how much worked finished on both the sides ...
How finance for pipeline is managed ...
and at what rate Iran is selling gas ....

Thanks in advance

Iran has already constructed her part of the pipeline
regarding Pakistan you can read the news in the same page (above posts)

It will be completed by late 2014 or early 2015

There is hardly any hurdle left in this project

regarding finance... we are going to use this gas for electricity purposes... so the users are going to pay for its consumption cost

regarding initial capital... then many countries has expressed desire to invest or build this pipeline including one Russian company and some chinese

 

[ajtr]

Excerpt dealing with the IPI pipeline from the cable released by Wikileaks:

Friday, 12 June 2009, 12:11
S E C R E T SECTION 01 OF 03 BAKU 000478 ...............................

Projected Problems in Iranian Gas Links
---------------------------------------

¶9. (C) The annual Baku Oil and Gas Show, held June 2-5, brought a variety of energy company executives and pundits to Baku, though no senior officials from Iran. An American interlocutor told Baku Iran Watcher on the side of the show that a [Source removed] had confided to him in a private conversation on June 4 that he viewed near-term implementation of the Iranian-Pakistani gas link project as “very unlikely.” The downbeat comment by the [Source removed] was made despite the recent signing in Istanbul by President Ahmadinejad and President Zardari of an Iranian-Pakistani MOU committing to the gas project. According to this source, [Source removed] indicated that he had several reasons for this opinion, but the only one he elaborated was that “the Pakistanis don’t have the money to pay for either the pipeline, or the gas.”

¶10. (C) Meanwhile, during a panel discussion at the conference on the future prospects of Caspian gas, several commentators noted the difficulty of doing business in “unpredictable, overly bureaucratic” Iran, and the alleged historical “unreliability” of Iranian gas supply contracts previously reached with Turkey and Turkmenistan. For example, panelists recounted that, after long negotiations, Iran has four times failed to sign separate Liquid national Gas contracts at the last minute. Two panelists claimed that Iran has repeatedly diverted gas supplies to meet domestic needs, thereby interrupting its contractual gas exports - and has not paid contractual penalties for these violations.

¶11. (C) A [Source removed] asserted bluntly that Iranian political leaders are totally focused on domestic needs and personal jockeying, and are simply not interested in hearing about the value of optimizing foreign gas exports. The only exception, he claimed, is their interest in the notional prospect of annually exporting ten billion cubic meters (bcms) of gas to Europe. He attributed this interest to a conviction that such a deal will significantly increase Iran’s political leverage in Europe and substantially insulate it from future European pressure - a perception he characterized as revealing, and “typically” unrealistic.
DERSE

Wikileaks

 

[Hutchroy]

A flow of troubles for Iran-Pakistan pipeline

Syed Fazl-e-Haider

Pakistan’s south-western province of Balochistan, which shares long borders with Iran and Afghanistan, is the key area for strategic gas pipeline projects from energy-rich Iran, the Middle East or Central Asia to energy-hungry south and west Asia.

Conflict in Balochistan, which appears to be the result of Baloch insurgency against federal authorities in Islamabad, is not without its geopolitical implications. Unrest in Balochistan and the anti-Iran activities of Jundallah, a militant group that is believed to be based in Balochistan, make the Iran-Pakistan gas pipeline project a risky venture. Similarly, the proposed Turkmenistan-Afghanistan-Pakistan-India gas pipeline will have to pass through turbulent regions not only in Afghanistan but also in Balochistan.

Pakistan plans to construct about 780km of pipeline from its border with Iran, running along the Makran Coastal Highway to connect with its existing gas transmission network at Nawabshah in Sindh. Almost 665km of the pipeline will pass through Balochistan, while about 115km of it will be laid in the Sindh province. Washington has strongly opposed the Iran-Pakistan pipeline project, asking Islamabad to abandon the project. India walked out of the project in 2009 after the US offered co-operation in civil nuclear energy.

Defying the US pressure, Islamabad and Tehran signed a US$7.5 billion (Dh27.54bn) agreement in Tehran on May 23 2009, finalising the deal to transfer gas from Iran to Pakistan. Exactly one week later, Iran closed its border with Pakistan after a suicide bomb attack on a mosque in Zahidan that caused 20 deaths and many injuries. Jundallah claimed responsibility for the blast.

The diplomatic tension between the two countries mounted at a time when there was no outstanding issue impeding the gas pipeline project. Under the pipeline deal, the government of Pakistan would be responsible to protect the gas pipeline in its territory. The restive Balochistan provides a haven on the frontier for Jundallah, which is fighting for the rights of the Sunni Baloch population of Sistan-Balochistan.

Jundallah has been a source of worry for Tehran. Iran accuses the US of supporting Jundallah, which claimed responsibility for twin suicide attacks on a Shiite mosque on July 15 last year in Zahidan, the provincial capital of Sistan-Balochistan that borders Pakistani Balochistan. Twenty-seven people were killed in those explosions. The Iranian government is reportedly facing domestic political opposition over the pipeline deal, which critics believe is not financially and strategically viable. The Iranian oil ministry had reportedly informed its government of the Jundallah threat to the proposed gas pipeline, the greater part of which has to pass through Balochistan where Jundallah is reported to have roots.

India has been calling the proposed gas pipeline from Iran across Pakistan a risky venture that would be difficult to finance. It has been expressing its concern over security for the pipeline which has to run across volatile areas in which other pipelines have been attacked in the past.

India has long accused Pakistan of sponsoring cross-border terrorism into Kashmir, while Pakistan accuses India of fomenting insurgency in Balochistan from Afghanistan, where India has a large diplomatic presence. India has so far provided $1.2bn in aid to build economic and social opportunities in Afghanistan since a US-led campaign ousted the Taliban regime in 2001. Washington strongly supports India’s involvement in Afghanistan, while Pakistan is deeply suspicious of it. Islamabad claims that Baloch separatists are backed by India and that is fuelling unrest in Balochistan.

Before December 2005, when a military operation was undertaken by federal authorities in Islamabad for the fifth time to quell an insurgency in Balochistan, there were the provincial government, Baloch nationalist parties, tribal chiefs (Sardars) and the local population who were the major stakeholders in the province’s socio-political scenario. The scenario has changed, as the province is facing an insurgency backed by the separatists, who have emerged as the major stakeholders.

The worsening security situation in Afghanistan and Balochistan has so far been the major reason for delaying any project for importing gas reserves from central Asia to south Asia.

The players in the global energy game are trying to hold stakes in the strategically located Afghanistan and Balochistan, which are the key nodes in pipeline politics in the region.

If India’s interest in Afghanistan is guided by its aim of gaining influence in Balochistan, its support of Baloch separatists would make it a covert stakeholder in the ongoing conflict in Balochistan.

Balochistan can emerge as a key node to corner central Asia’s mineral wealth through trans-Afghan links to world markets. Its geo-strategic location makes it the most attractive for transit traffic to the landlocked Afghanistan and the central Asian republics (CARs).

The Turkmenistan-Afghanistan-Pakistan-India pipeline project is expected to open up central Asia’s vast natural gas reserves to the wider world for the first time. The objective of the project will be achieved if political stability returns to Afghanistan. Balochistan would emerge as the frontline province in transportation of Caspian mineral wealth to the wider world.

Balochistan has suffered decades of neglect that intensified the feeling of alienation among local people. Baloch nationalists are fighting for their political and economic rights as enshrined in the 1973 constitution of Pakistan. The separatists are struggling for independence of Balochistan, hence they are involved in attacking the security forces, public servants, public installations and innocent citizens.

A transnational gas pipeline could turn the province into an important energy conduit in the region. The authorities in Islamabad are making an effort to appease the Baloch insurgents through the announcement of financial packages, but this is one deal that might remain a pipe dream.

 

[S.M.R]

Pakistan 'punished' in Pipelineistan
By Pepe Escobar

Before the end of 2011, Pakistan will start working on its stretch of the IP (Iran-Pakistan) gas pipeline - according to Asim Hussain, Pakistan's federal minister for petroleum and natural resources. The 1,092 kilometers of pipeline on the Iranian side are already in place.

IP, also known as "the peace pipeline", was originally IPI (Iran-Pakistan-India). Although it badly needs gas for its economic expansion, faced with immense pressure by the George W Bush - and then Barack Obama - administrations, India still has not committed to the project, even after a nearly miraculous agreement for its construction was initialed in 2008.

More than 740 million cubic feet of gas per year will start flowing to Pakistan from Iran's giant South Pars field in the Persian Gulf by 2014. This is an immense development in the Pipelineistan "wars" in Eurasia. IP is a major node in the much-vaunted Asian Energy Security Grid - the progressive energy integration of Southwest, South, Central and East Asia that is the ultimate mantra for Eurasian players as diverse as Iran, China, India and the Central Asian "stans".

Pakistan is an energy-poor, desperate customer of the grid. Becoming an energy transit country is Pakistan's once-in-a-lifetime chance to transition from a near-failed state into an "energy corridor" to Asia and, why not, global markets.

And as pipelines function as an umbilical cord, the heart of the matter is that IP, and maybe IPI in the future, will do more than any form of US "aid" (or outright interference) to stabilize the Pakistan half of Obama's AfPak theater of operations, and even possibly relieve it of its India obsession.

Another 'axis of evil'?
This Pipelineistan development may go a long way to explain why the White House announced this past Sunday it was postponing US$800 million in military aid to Islamabad - more than a third of the annual such largess Pakistan receives from the US.

The burgeoning Pakistan-bashing industry in Washington may spin this as punishment related to the never-ending saga of Osama bin Laden being sheltered so close to Rawalpindi/Islamabad. But the measure may smack of desperation - and on top it do absolutely nothing to convince the Pakistani army to follow Washington's agenda uncritically.

On Monday, the US State Department stressed once again that Washington expected Islamabad to do more in counter-terrorism and counter-insurgency - otherwise it would not get its "aid" back. The usual diplomatic doublespeak of "constructive, collaborative, mutually beneficial relationship" remains on show - but that cannot mask the growing mistrust on both sides. The Pakistani military confirmed on the record it had not been warned of the "suspension".

No less than $300 million of this blocked $800 million is for "American trainers" - that is, the Pentagon's counter-insurgency brigade. Moreover, Islamabad had already asked Washington not to send these people anymore; the fact is their methods are useless to fight the Pakistani Taliban and al-Qaeda-linked jihadis based in the tribal areas. Not to mention the preferred US method is the killer drone anyway.

The wall of mistrust is bound to reach Himalaya/Karakoram/Pamir proportions. Washington only sees Pakistan in "war on terror", counter-terrorism terms. Since the coupling of the AfPak combo by the Obama administration, clearly Washington's top war is in Pakistan - not in Afghanistan, which harbors just a handful of al-Qaeda jihadis.

Most "high-value al-Qaeda targets" are in the tribal areas in Pakistan - and they are, in a curious parallel to the Americans, essentially trainers. As for Afghanistan, it is most of all a neo-colonial North Atlantic Treaty Organization (NATO) war against a Pashtun-majority "national liberation" movement - as Taliban leader Mullah Omar himself defined it.

Asia Times Online's Saleem Shahzad - murdered in May - argued in his book Inside al-Qaeda and the Taliban (full review coming later this week) that al-Qaeda's master coup over the past few years was to fully relocate to the tribal areas, strengthen the Tehrik-e-Taliban Pakistan (Pakistani Taliban), and in a nutshell coordinate a massive Pashtun guerrilla war against the Pakistani army and the Americans - as a diversionist tactic. Al-Qaeda's agenda - to export its caliphate-bound ideology to other parts of South and Central Asia - has nothing to do with the Mullah Omar-led Afghan Taliban, who fight to go back to power in Afghanistan.

Washington for its part wants a "stable" Afghanistan led by a convenient puppet, Hamid Karzai-style - so the holy grail (since the mid-1990s) can be achieved; the construction of IP's rival, the TAPI (Turkmenistan-Afghanistan-Pakistan-India) gas pipeline, bypassing "evil" Iran.

And as far as Pakistan is concerned, Washington wants it to smash the Pashtun guerrillas inside their territory; otherwise the tribal areas will keep being droned to death - literally, with no regard whatsoever to territorial integrity.

No wonder the wall of mistrust will keep rising, because Islamabad's agenda is not bound to change anytime soon. Pakistan's Afghan policy implies Afghanistan as a vassal state - with a very weak military (what the US calls the Afghan National Force) and especially always unstable, and thus incapable of attacking the real heart of the matter: the Pashtunistan issue.

For Islamabad, Pashtun nationalism is an existential threat. So the Pakistani army may fight the Tehrik-e-Taliban-style Pashtun guerrillas, but with extreme care; otherwise Pashtuns on both side of the border may unite en masse and make a push to destabilize Islamabad for good.

On the other had, what Islamabad wants for Afghanistan is the Taliban back in power - just like the good old days of 1996-2001. That's the opposite of what Washington wants; a long-range occupation, preferably via NATO, so the alliance may protect the TAPI pipeline, if it ever gets built. Moreover, for Washington "losing" Afghanistan and its key network of military bases so close to both China and Russia is simply unthinkable - according to the Pentagon's full-spectrum dominance doctrine.

What's going on at the moment is a complex war of positioning. Pakistan's Afghan policy - which also implies containing Indian influence in Afghanistan - won't change. The Afghan Taliban will keep being encouraged as potential long-term allies - in the name of the unalterable "strategic depth" doctrine - and India will keep being regarded as the top strategic priority.

What IP will do is to embolden Islamabad even more - with Pakistan finally becoming a key transit corridor for Iranian gas, apart from using gas for its own needs. If India finally decides against IPI, China is ready to step on board - and build an extension from IP, parallel to the Karakoram highway, towards Xinjiang.

Either way, Pakistan wins - especially with increasing Chinese investment. Or with further Chinese military "aid". That's why the Pakistani army's "suspension" by Washington is not bound to rattle too many nerves in Islamabad.

Asia Times Online :: THE ROVING EYE : Pakistan 'punished' in Pipelineistan

 

[S.M.R]

Iran to Start Pumping Gas to Pakistan Next Year

TEHRAN (FNA)- Tehran's Envoy to Islamabad Mashallah Shakeri announced that Iran would start pumping gas to Pakistan as early as next year.

"If desired, Pakistan can connect with the pipeline next year," the ambassador added.

He said the Iranian government has constructed the pipeline on war footing just to facilitate Pakistan.

Shakeri, who is in his fifth year as Tehran's envoy to Islamabad, said that his country is earnestly and sincerely desirous of providing gas to Pakistan.

Islamabad has also announced earlier this year that it has intensified work on the multi-billion-dollar pipeline project which is due to bring Iran's gas to Pakistan, Pakistani media reports said on Sunday.

Work on Iran-Pak Gas Pipeline is quickly progressing and the National Engineering Services Pakistan (Nespak) signed an agreement with a German Company to place the pipeline, the reports said in April.

Speaking at a conference on "Challenges Faced by Industries in the country: Remedies and Future Prospects for Industrialization", Sui Southern Gas Company (SSGC) Managing Director Dr Faizullah Abbasi stated in April that approximately 1750mn cubic feet (mcf) of gas will be brought through this pipeline.

In a major breakthrough on March 20, 2009, the Pakistani government approved Iran's proposed pricing formula for gas supplies to the South Asian nation.

Subsequently, Tehran and Islamabad signed a final agreement to launch implementation of the project.

Tehran and Islamabad also sealed a final contract for the start of Iran's gas exports to Pakistan through the multi-billion-dollar pipeline in spring 2014.

The last annex of the agreement for export of Iran's gas to Pakistan was signed on June 13 by Iranian Oil Minister Massoud Mir-Kazzemi and Managing Director of Pakistan's Inter-State Gas Company Naeem Sharafat in a meeting also attended by the Iranian oil ministry's representative in gas talks with Pakistan Seyed Reza Kassayeezadeh.

The 2700-kilometer long pipeline was to supply gas for Pakistan and India which are suffering a lack of energy sources, but India has evaded talks. Last year Iran and Pakistan declared they would finalize the agreement bilaterally if India continued to be absent in the meetings.

According to the project proposal, the pipeline will begin from Iran's Assalouyeh Energy Zone in the south and stretch over 1,100 km through Iran. In Pakistan, it will pass through Baluchistan and Sindh but officials now say the route may be changed if China agrees to the project.

The gas will be supplied from the South Pars field. The initial capacity of the pipeline will be 22 billion cubic meters of natural gas per annum, which is expected to be later raised to 55 billion cubic meters. It is expected to cost $7.4 billion.

Fars News Agency :: Iran to Start Pumping Gas to Pakistan Next Year

 

[AZADPAKISTAN2009]

CIA is funding insurgency in Baluchistan , later it will use as weapon to pressurize Pakistan , just like how Sudan/ Libya had been split up if I was Pakistan Army I would destroy any insurgency to core in Baluchistan and apply drones to protect gas lines

 

[H2O3C4Nitrogen]

Iran-Pakistan gas pipeline: China likely to be awarded construction contract

SSGC and SNGPL are also lobbying to grab the engineering, procurement and construction contract for the pipeline. PHOTO: FILE
ISLAMABAD:


As Russia and China vie with each other to win the construction contract for the Iran-Pakistan gas pipeline project, Pakistan is expected to finalise an engineering and procurement deal with Beijing, which may also provide financing in line with the growing energy cooperation between the two sides.
Domestic gas utilities – Sui Southern Gas Company (SSGC) and Sui Northern Gas Pipelines Limited (SNGPL) – are also lobbying to grab the engineering, procurement and construction contract for the pipeline, which will bring in much-needed gas from Iran’s South Pars gas field.
Germany-based consultancy firm ILF is conducting a route survey for the $1.25 billion Pakistani portion of the pipeline and will soon be completing its work, after which the engineering contract will be awarded. SSGC and SNGPL had also wanted a share in the consultancy contract with ILF, which resulted in a delay in completing the survey, sources said.
ILF, which got the contract for $55 million, is working in collaboration with National Engineering Services of Pakistan (Nespak).
“A major part of the survey for laying the pipeline from Iranian border to Nawabshah has been completed and the remaining part will be finished by August 2,” an official said.
During Musharraf’s rule, the government had floated a proposal, asking China to import Indian share of the gas pipeline after Delhi pulled out of the project. However, the proposal did not go through.
Sources told The Express Tribune that a Pakistani delegation, led by Federal Water and Power Minister Naveed Qamar, would seek investment and offer the engineering and equipment procurement contract for the gas pipeline to China. The delegation will raise the issue in a meeting of the Pak-China joint energy working group scheduled to be held on August 1-2 in Beijing.
Sources said security agencies had given clearance to the route of the pipeline. “The Bugti area is a sensitive location for oil and gas exploration activities, but other areas are safe for the transport of Iranian gas through the pipeline,” a source said.
Earlier, Pakistan had also made a formal offer to Russian energy giant Gazprom, the largest extractor of natural gas in the world, to participate in the Iran-Pakistan pipeline project in a meeting of the Pak-Russia Inter-governmental Commission held on September 22, 2010 in Russia.
Pakistan and Iran have already signed an agreement on sovereign guarantee for the project. They have also inked a gas sale and purchase agreement for import of 750 million cubic feet per day (mmcfd) of natural gas with a provision to increase the volume to one billion cubic feet per day.
The project will be funded through public-private partnership, which will cost Pakistan an estimated $1.25 billion for its side of the pipeline.
Under the agreement, gas supply will start in 2014 and Pakistan will have to pay a penalty equal to the cost of 750 mmcfd if it fails to receive gas by the stipulated time.
Published in The Express Tribune, July 31st, 2011.

 

[H2O3C4Nitrogen]

In every country where west is demonized the Chinese are getting a free Ride, Least to mention the Chinese don't intend to bomb innocent Pakistanis with helfire missiles , but the gradual economic takeover could backfire one day . . . .

 

[A.Rafay]

ISLAMABAD - President Asif Ali Zardari is scheduled to visit Iran in the near future to sign a contract on Tehran's investment in a pipeline project which is due to take Iran's rich gas reserves to energy-hungry Pakistan, Iranian media reported Saturday.
Earlier on Thursday, Foreign Minister Hina Rabbani Khar reiterated her country's determination to push ahead with the building of the gas pipeline, adding that Zardari is scheduled to travel to Tehran in near future to discuss the finalization of the project.
Underscoring Pakistan's daily-growing demand for Iran's gas, she said the project would be pursued under any condition.
The agreement was to be inked between Tehran and Islamabad during the November visit to Pakistan by President Mahmoud Ahmadinejad, but the text of the contract was not ready and the endorsement ceremony was postponed, FARS news agency reported.
Pakistani Petroleum and Natural Resources Minister Asim Hussain visited Tehran earlier this month to prepare the grounds for compiling the text of the contract and held meetings with several Iranian officials, including President Mahmoud Ahmadinejad.
The Pakistani government has on many occasions reiterated its resolve to push ahead with the $1.5 billion Iran-Pakistan (IP) gas pipeline project.
According to the project proposal, the pipeline will begin from Iran's Assalouyeh Energy Zone in the south and stretch over 1,100 km through Iran. In Pakistan, it will pass through Baluchistan and Sindh but officials now say the route may be changed if China agrees to the project.

Zardari due in Tehran in near future to sign pipeline deal | Pakistan Today | Latest news | Breaking news | Pakistan News | World news | Business | Sport and Multimedia

 

[BATMAN]

There we go... once again.... from scratch!

 

[xyxmt]

This is sickening, how many times I heard Pipeline deal is signed
our dumbass journalists should confirm every mega claim by our deceiving and corrupt govt before putting it in the news, they must confirm it with other party. these mofos go there to beg for money and then make false claims this visit is no different

 

[AZADPAKISTAN2009]

This Zardari rascal*** is delaying the sigining can't wait for 2013 elections to throw this idiot out of Pakistan altogether

 

[BATMAN]

Is it second pipe line.. which he's going to sign?

How will he go to Tehran? via Dubai! or Dehli?

 

[Secur]

As far as I understand it , the agreement is for the Iranian finance of the Pakistani side of IP pipeline since essentially everybody else has backed out of it ...

 

[A.Rafay]

ISLAMABAD:
The National Bank of Pakistan (NBP) said on Tuesday that it is ready to finance the Iran-Pakistan (IP) gas pipeline project if the State Bank of Pakistan (SBP) directs it to do so.
“The IP [gas pipeline] is a big project: a consortium of banks can finance it, and we can become a part of such a consortium if the SBP directs us,” NBP Senior Vice President and Divisional Head of Consumer and Retail Banking Adnan Adil Hussain said while addressing a press conference here. He said the NBP had also been financing other energy-related projects like the Neelum Jhelum hydropower project.
Shedding light on other aspects of NBP’s business, he informed the gathering that the bank had been providing free of cost services to pensioners. “The NBP has disbursed more than Rs210 billion, while more than 1.6 million government employees have benefited from the advance salary personal loan facility launched in 2003,” he said. He added that the bank was enhancing the loan facility of the advance salary service to a maximum of one million rupees to the income bracket that can afford it.

He also said that the bank was handling salaries and government businesses along with pensions and personal loans, and that no other bank could rival the NBP in doing so. “Yet, the NBP is competing other commercial banks in their domain as well,” Adnan added.
He said that agriculture was another area where the NBP demonstrated its commitment and resolve to national interests. “The NBP leads its counterparts by a huge margin, and reaches out to more than 250,000 farmers in every nook and corner of the country,” he said; adding that the bank stands only second in the provision of agricultural credit needs after the Zarai Taraqiati Bank. “Out of the agricultural sector’s financing needs of Rs750 billion, NBP is catering to around 19%.”
He added that the NBP was equally active in catering to the housing finance sector through its ‘Saibaan’ product. However, in 2008-09, against the global backdrop of betting on subprime mortgages, the economic recession, interest rate hikes and the emergence of loan defaults, the bank was prompted to adopt a cautious policy and lend selectively. This policy remained in force till 2010.
The NBP remains an active player in commercial and small and medium enterprise (SME) lending. In the domestic SME sector, its financing share is around 10%.
“Yet, NBP is also the largest bank handling the pledge of stocks in seasonal finance; catering to needs of cotton, rice and wheat traders and millers, which requires less collaterals and more stocks for the industry to grow [sic],” he added.

NBP says ready to finance IP gas pipeline project – The Express Tribune