News
Saturday, February 24, 2007
Transit fee and transportation cost: Pakistan, India and Iran vow to finalise proposals by March 15By Sajid Chaudhry
ISLAMABAD: Pakistan and India have said that the import of gas from Iran is a national requirement for both and that both are committed to going through with the Iran-Pakistan-India (IPI) gas pipeline project.
During the two-day Joint Working Group (JWG) meeting, Pakistan and India also exchanged proposals based on the best international practices on transit fee and transportation cost and pledged to respond by March 15 to conclude an agreement in this respect.
“This was the fourth bilateral meeting, which has concluded on a positive note,” Pakistan’s Secretary Petroleum Ahmed Waqar said at a joint press conference he held along with Indian Petroleum and Natural Gas Secretary MS Srinivasan, Iranian observer Fatah Bayatani, and Mukhtar Ahmed, advisor to the prime minister on energy, on Friday. Waqar said that India and Pakistan had agreed, in principle, that the transportation cost and transit fee would be finalised according to internationally-accepted models.
He said that both countries had also agreed on gas-pricing mechanism and after completing its homework the Petroleum Ministry would seek its approval from the federal cabinet within next 10 days.
He said that both the countries had also agreed to import a total of 5.3 billion cubic feet (bcf) of gas per day from Iran, which would be shared between them as per requirements. Of the 5.3bcf gas around 2.1bcf would be available to both the countries at the Pakistani border in the first phase, ending by 2010. The two countries will share this gas at a ratio of 50% and 50% or 1.05bcf for each country per day. The remaining gas requirement of 3.2bcf would be met on the completion of second phase of the project.
“Iran’s gas reserves are sufficient to meet the requirements of both countries for the 30 years,” he said. The petroleum secretary said that all the three countries had also agreed that drafts prepared by them on gas price agreement, joint declaration and framework agreement would be exchanged to reach an early consensus. All such agreements and other documents would be finalised by end of April 2007 and would be submitted to the JWG, which would meet in May 2007 for the final technical review.
“All the agreements on IPI project would be signed by June 2007 to enter into the implementation phase,” he said.
Waqar said that an international expert would carry out the feasibility study of the IPI project and Iran would provide technical input to the consultant. The study would be completed within 8-9 months for making this important project bankable, which would help availability of finances for the project. He said that the financing arrangements would be met through private sector or public-private partnership.
Mukhtar Ahmed, advisor to the prime minister on energy, said that the international consultant would complete the feasibility study for all the three countries.
Fatah Bayatani, general manager, National Iranian Gas Export Company, also confirmed that Iranian gas reserves were internationally certified and Iran would be able to meet the gas requirements of Pakistan and India for over 30 years. Waqar said that the 2,200 kilometres IPI gas pipeline would cost around $7 billion. He said that the National Engineering Services of Pakistan (NESPAK) was in the process to carry out a study for route of gas pipeline from Iranian border to Indian border.
Courtesy DailyTimes.com.pk