Pipeline talks begin on optimistic note: Joint statement today
By Khaleeq Kiani
ISLAMABAD, Sept 8: Pakistan and India on Thursday made progress in talks on financial, technical, security and legal issues of the 7.4 billion Iran-Pakistan-India (IPI) gas pipeline project, agreeing to finalise a framework accord in two months.
The petroleum secretaries of the two countries also agreed to adopt international standards for transit fee, security and environmental issues under the Trilateral Framework Agreement. The two also asked Iran to provide independent certification of its gas reserve allocation for the IPI-project.
This was the outcome of Pakistan-India Joint Working Group deliberations on the first day of a two-day meeting on trans-Pakistan gas pipeline project. Pakistani side is led by Secretary Petroleum Ahmad Waqar and Advisor to the Prime Minister Mukhtar Ahmad and the Indian team by Secretary Petroleum Sushil Chand Tripathy.
After the meeting, Mr Waqar told this correspondent that the bilateral talks were progressing positively and smoothly and efforts were being made to synchronize progress on all issues relating to the gas pipeline through input from all the parties.
He said the JWG would meet again on Friday to refine the outcomes before releasing a joint statement.
He said the two sides discussed the prospects of required gas quantities for the pipeline by the year 2010 and subsequent build up till 2015.
According to him, Pakistan’s requirement will begin from 90-MMCFD (million cubic feet per day) in 2010 and go up to 540-MMCFD by 2015. Similarly, India will have an initial requirement of about 540-MMCFD in 2010 and go up to 1.08 billion cubic feet per day by 2015.
As such the total requirement for the pipeline will begin with about 630-MMCFD in 2010 and go up to 1.62-MMCFD by 2015. So the pipeline will be required of 56-inch diameter.
Mr Waqar said Pakistan also presented its views on ‘take and pay quantities’ as it was currently applying a principle of 75-80 per cent of take or pay for gas supplies. Indian side would come up with its response on Friday.
He said the two sides also discussed the quality of gas for the pipeline i.e. whether it should be lean or rich gas.
Pakistan, he said, wanted LPG-rich gas for the pipeline so that it could extract liquefied petroleum gas from the pipeline for domestic use. India would respond on the subject on Friday.
The JWG agreed to adopt international standards for calculating transit fee. Pakistan proposed the calculation on the basis of total volume plus per kilometre length of the pipeline or on overall percentage basis. India would come up with its position on the second and last day of talks.
Answering a question on the project structure, the secretary petroleum said India had already appointed Ernst Young as its financial advisors to suggest project structure whereas Pakistan would open bids for the purpose on September 15. It would finally determine how the project should be implemented.
Mr Waqar said Pakistan informed the Indian side that the federal cabinet had approved a plan to join the Energy Charter Treaty. Indian side said they were in the process of cabinet approval.
He said the two sides had agreed that international standards and principles on environment, safety and security of the pipeline and operations should be adopted for the pipeline.
He said the two sides discussed broad parameters of the Trilateral Framework Agreement to be signed by Iran, Pakistan and India. It was agreed that Indian side would finalize a draft agreement before the next JWG meeting for review and consideration by Pakistan. This would then be shared with Iran before formal signing by the end of this year. The agreement would then lead to a set of other agreements.
Answering another question, Mr Waqar said Iran had been asked to identify gas fields, indicate their reserves and provide third party independent certification of the gas fields and reserves it planned to dedicate for the gas pipeline.
He said Pakistan was expected to receive a detailed term-sheet from Iran in the next few days on the project details that would pave the way for synchronization of related issues.
He said the two sides also discussed Turkmenistan-Afghanistan-Pakistan pipeline project and Gulf-South Asia pipeline project.
Sources said Pakistan asked Indian side to confirm its options of gas delivery points on Pakistan-India border so project route surveys could be conducted in technical terms and in relation to security aspects.
The parties agreed that about 40-feet wide stretch of land would be required for the project, sources said.
