World's Energy

25 April 2008 – Upstream OnLine – Representatives of Pakistan, India and Afghanistan signed a framework deal in Islamabad yesterday to buy natural gas from Turkmenistan, Pakistani media reported. The US-backed deal allows India to join a pact signed in 2002 to begin importing gas from Turkmenistan by 2015, Pakistan’s Dawn newspaper said in its online edition. The agreement, which will require the building of a pipeline projected to cost $7.6 billion, is seen as an alternative to the so-called Peace pipeline plan to bring Iranian gas to India and Pakistan via Afghanistan. The US is opposed to the Peace pipeline because it hopes to isolate Iran over its controversial nuclear programme. The newspaper said uncertainty about the Iran-Pakistan-India (IPI) pipeline continued amid ongoing disputes between the partners about transportation fees and tariffs. The Turkmenistan pipeline will supply 90 million cubic feet of gas per day to the Dauletabad field to Fazilka on the Pakistan-India border. Under today’s deal, Afghanistan is proposing to tap 5 million cubic metres per day from the pipe during the first two years of operation and 14 MMcm per day thereafter. India and Pakistan will split the remaining capacity. However, Pakistan and India both reportedly said following the signing that they remained commited to the Iran-Pakistan-India pipeline. "There is no pressure on us over the IPI and we will move forward on the project," Pakistani Oil Minister Khwaja Asif said at a press conference, Iran's official IRNA news agency said. Indian Energy Minister Morli Deora was quoted as saying: "We are still committed to the IPI". The pair said they would discuss the IPI pipe in talks in Islamabad today. Asia Development Bank director Peter Fedon said the bank had assisted in the signing of the Turkmenistan pipe deal. However, he reportedly would no say whether the bank would play a role in the Iranian pipe project.