Strategic retreat: NBP, OGDC burst the IP gas pipeline bubble

[nalandapride]

Not quite. The Indians backed out of the deal following US pressure. No more India in the 'pipeline', so to speak.

Because we Indians won't want that our interest being hijacked by Pakistan. Many of India-haters in Pakistan got traumatize even with pity issue of MFN, what would have done with the pipeline bombing it every fortnight.

 

[idune]

Don't spew nonsense! Why should Indians celebrate? Are you aware that this pipeline will eventually be extended to India to make up for the shortage of gas? It was to be only a matter of time. India needs Iranian gas as much as Pakistan does.

You seem to be inebriated with exuberance of your verbosity against anything to do with India. Jeeeez!

Look at the first post with excitement from indians. Now read carefully, pipeline project changed from IPI (Iran_Pakistan-India) to IP (Iran-Pakistan). Because, india bowed down to US pressure and also the fact Iran did not agree to Indian price scam and also india will not get guarantee its looking for - pipeline from Iran is a pipe dream for india. More than indian need india can not live with choices it has to make. Get a shot of reality before speak up.

 

[OrionHunter]

Now read carefully, pipeline project changed from IPI (Iran_Pakistan-India) to IP (Iran-Pakistan). Because, india bowed down to US pressure and also the fact Iran did not agree to Indian price scam and also india will not get guarantee its looking for - pipeline from Iran is a pipe dream for india. More than indian need india can not live with choices it has to make. Get a shot of reality before speak up.

A little knowledge is a dangerous thing. You need to have studied the issue in detail before giving your so called 'expert' opinion.

The facts is that though the US did apply pressure, it was not the reason at all. It was the pricing on which Iran tried to milk India to the maximum which was not economically viable. The second more important reason was the security guarantee that was to be provided by Pakistan which they refused. Now India obviously doesn't want a situation where it spends billions of dollars on constructing an overland pipeline when there is no guarantee of its viability due to the security threats emanating from Pakistani soil.

In the case of the Iran to India natural gas pipeline, India proposed the transportation of natural gas in liquid form (LNG), using the coastline along the Arabian Sea. The pipeline would begin in Iran and travel from the South Pars Oil Field in the Persian Gulf through the Arabian Sea, just outside the territorial waters of Pakistan and onto Delhi by way of ports on India's western coast. This pipeline would have also connected to Pakistan's hinterland via Karachi. However, Pakistan has refused to allow a feasibility study to be conducted by India near its waters on the exclusive economic zone (EEZ).

That's where it stand as of now. If you think American pressure was the reason, you're sadly mistaken. India will still go ahead if Pakistan allows the feasibility study and construction of the pipeline through the alternative route.

 

[Screambowl]

Look at the first post with excitement from indians. Now read carefully, pipeline project changed from IPI (Iran_Pakistan-India) to IP (Iran-Pakistan). Because, india bowed down to US pressure and also the fact Iran did not agree to Indian price scam and also india will not get guarantee its looking for - pipeline from Iran is a pipe dream for india. More than indian need india can not live with choices it has to make. Get a shot of reality before speak up.

‘No hitch in India-Iran pipeline project'
http://www.thehindu.com/news/national/article2742561.ece

INDIA'S ATTITUDE ‘POSITIVE
Mr. Velayati termed India's stand on Iran, expressed recently at the United Nations, as “positive” and “friendly.” India had spoken out against sanctions, favoured a diplomatic solution and urged Iran to answer clarifications sought by the International Atomic Energy Agency (IAEA).
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this is somewhat like a slap to your post!!

 

[Bang Galore]

Not quite. The Indians backed out of the deal following US pressure. No more India in the 'pipeline', so to speak.

Well the Indian economy speaks a lot more than any of us can or need to. No one is seriously interested in a pipeline that terminates in Pakistan. The only countries of interest here are India & China, more India simply because it is an easier pipeline to lay. India will still buy more gas, pipeline or not than Pakistan ever can. The Iranians and the Omanis both understand that simple piece of economics as does Israel which suddenly finds itself with surplus gas. India will never be a loser whether it participates in a pipeline or not simply because supply always follows demand. The Iranians have the most to lose since a pipeline would have given them a head start over other suppliers. Tough luck for them & a good break for the others.

Look at the first post with excitement from indians. Now read carefully, pipeline project changed from IPI (Iran_Pakistan-India) to IP (Iran-Pakistan). Because, india bowed down to US pressure and also the fact Iran did not agree to Indian price scam and also india will not get guarantee its looking for - pipeline from Iran is a pipe dream for india. More than indian need india can not live with choices it has to make. Get a shot of reality before speak up.

The reality is simply this; if India has to risk a pipeline through Pakistan, the rewards better be worth the effort. No one in India is the least bit interested in taking huge risks & also getting ripped off on the price. India can & will find other suppliers & if necessary a pipeline will eventually be laid in the sea. Our leaders are elected to look after our interests not those of Iran or Pakistan.

 

[Kyusuibu Honbu]

Well the Indian economy speaks a lot more than any of us can or need to. No one is seriously interested in a pipeline that terminates in Pakistan. The only countries of interest here are India & China, more India simply because it is an easier pipeline to lay. India will still buy more gas, pipeline or not than Pakistan ever can. The Iranians and the Omanis both understand that simple piece of economics as does Israel which suddenly finds itself with surplus gas. India will never be a loser whether it participates in a pipeline or not simply because supply always follows demand. The Iranians have the most to lose since a pipeline would have given them a head start over other suppliers. Tough luck for them & a good break for the others.

People over exaggerate the importance of the natural gas and pipelines. Something interesting to note:

HOW DOES INDIA’S ENERGY SECURITY AFFECT HER NATIONAL SECURITY?

The energy pipelines in themselves are not adequate to meet all of India’s energy security requirements. Together they would provide 136 mmscmd of natural gas as against a projected demand of 391 mmscmd in the period 2024-25. This constitutes only 35 percent of India’s total natural gas requirements in that period.

Natural gas in itself will not be adequate to meet India’s energy requirements. This can be addressed by pursuing a policy of energy mix, incorporating conventional energy sources, nuclear energy and NCES.

 

[Screambowl]

willing to go for this project but the Indian Govt. is worried about the security concern in Pakistan. The route via Pakistan is what holding this project. Govt. doesn't want to risk billions of dollars.

 

[Big Boss]

It was just a pipe dream which was never meant to be true.

Now see what happened.

 

[JonAsad]

The IP line was always a non-starter, given de facto realities of sanctions and financing.

This should not be any surprise, nor the fact that this situation is not likely to change any time soon.

A non-starter like Pakistan nuclear program?-
If you were in USA at that time aswell- you'll say the same?- :yes:-
Ofcourse cheng- what else?-

 

[VCheng]

A non-starter like Pakistan nuclear program?-
If you were in USA at that time aswell- you'll say the same?- :yes:-
Ofcourse cheng- what else?-

Wrong analogy. An international energy transit project is worlds apart from a classified domestic technical project.

 

[JonAsad]

Wrong analogy. An international energy transit project is worlds apart from a classified domestic technical project.

Forget the Analogy cheng-
Your statement is what matters here- would it be any different?- i dont think so-

 

[VCheng]

Forget the Analogy cheng-
Your statement is what matters here- would it be any different?- i dont think so-

My statement above regarding the IP pipeline project is correct, to stay on topic.

 

[ziaulislam]

ISLAMABAD: The government has faced a major set back in the Iran-Pakistan (IP) gas pipeline project as the country’s largest bank National Bank of Pakistan and the country’s largest exploration company Oil and Gas Development Company Limited on Thursday refused to finance it due to possible sanctions by the US.

Sources told The Express Tribune that a representative of National Bank of Pakistan (NBP) informed the steering committee on gas import projects on Thursday that it had branches in different countries of the world and therefore it feared that these branches could be closed due to US sanction against Iran.

Oil and Gas Development Company Limited (OGDCL) already cash constrained due to the circular debt said that its US investors, having a 1.6% share in the company, had threatened to retreat if the company financed the IP gas pipeline project.

The project, first proposed in the 1990s, has faced numerous delays. The United States last year said that Pakistan should be wary of committing to the proposed Iran-Pakistan natural gas pipeline.
The spiralling circular debt is another reason, another sources said. The Government Holding Company, however, is still committed to finance $60 million for the project.

TAPI project one step closer:

The steering Committee that met on Thursday also gave a go-ahead to sign the Gas Sales Purchase Agreement (GSPA) with Turkmenistan for Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project at 70 per cent parity of Brent oil. Pakistan earlier signed GSPA with Iran at gas price equal to 78 per cent of crude oil under Iran-Pakistan (IP) gas pipeline project. The TAPI gas pipeline project is valued at more than $3 billion.

Petroleum Minister Dr Asim Hussain confirmed to The Express Tribune that the steering committee had approved to hire a bank consortium of Pakistan and China including Habib Bank and Industrial and Commercial Bank of China Limited.The meeting informed that the government would generate Rs34 billion per year through charging Gas Development Cess (GDC) on natural gas to finance gas import projects, said an official.

The petroleum ministry also informed Prime Minister Yousaf Raza Gilani on Thursday during a meeting that the steering committee had approved the financial consultancy for Pakistan-Iran Gas Pipeline, which was a major step forward as far as the project was concerned.

Strategic retreat: NBP, OGDC burst the IP gas pipeline bubble – The Express Tribune

its true but we have to consider long term possiblites too. We are forgetting the pricing formula, its given to us on an outrageous cost so much cost that i wounder will we better to establish an infrastruture for liquid gas import....atleast india thought that arrangment would be cheaper..
iranianas are too greedy to offer any sutiable price to us and they know we have no choice.

12 dollars to MBTU is 4 times expensive than local gas and if petroleum prices go upto 150 dollars..the gas prices will also go upto 20 dollars MBTU thats is 6 times our local price..there is hell we can pay that much. Turkmenistan gas offering 3 times less but problem is we cant import it anytime soon.
remeber india backed up because of the price issu in the end

 

[Guest01]

It is sometimes disappointing to see the impishness in the whole situation from some of our pakistani friends. This gas at current cost is a financial leech waiting to happen to pakistan. Look at the rental power plants today which are sucking on the exchequer and eagerness of hafiz to roll them back. This hoopla shows the economic literacy because no one even considwrs the additional cost of borrowinf from an external commercial entity on top of the outrageous pricing anyway being offered by iran. On top of that please consider that the line still goes through the same old good balochistan where even the sui gas flow provides lessons to learn. That is for pakistan. Regarding india, does one really think that india will participate in a project where the current day pakistan will have the ability to switch the tap off. I mean seriously? Has nobody looked at how the water flows and what is happening there?

 

[Vinod2070]

Iran has to offer better terms to make this pipeline feasible.

They have not shown regard for contracts in the past and are asking for too high a price for the gas.

At these prices and in the absence of contractual binding agreements, it is just not worth it.