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The intrigue of the Iran - Pakistan – China gas pipeline

The intrigue of the Iran - Pakistan – China gas pipeline

Igor Pankratenko ,
Especially for Iran.ru

28 october 2015

The gas pipeline from Iran to Pakistan with the sonorous name "Mir", setting a record for the duration of discussions and approvals by December 2017 will become a reality from the laid pipes, infrastructure and LNG (liquefied natural gas).1735 kilometers in length, a little less than $ 2.5 billion in value, a lot of other numbers and percent - is its economy.In political terms the implementation of the "World" will mark the first step on the way of the involvement of Tehran created in China "economic space of the new Silk Road."

Due to the long period elapsed from the signing between Iran and Pakistan, an agreement on the construction of the "World" before the start of its implementation, a number of experts in Tehran and Islamabad, calling him "a second Bushehr." Keeping in mind, of course, a protracted history of the construction of the Bushehr nuclear power plant and the vicissitudes associated with the process of the Russian-Iranian contract. Compare frankly incorrect, since that "age" that inflame political intrigue, Bushehr near the "world" looks existent baby. Suffice it to recall that the idea of ​​its construction began in the late 50s (!) Years of the last century, when a teacher located in the northwest of Pakistan Military-Technical College "Risalpur" Malik Ahmad Khan has published scientific and practical article on the possible construction of such a pipeline. As is often the case with the ideas of breakthroughs, the text read, to debate and. forgotten. And only three decades later, in 1989, when the threat of shortage of gas beginning of vague prospects to take the character of the real danger, the idea has been the subject of official talks between the two countries officials.

Six years later, in 1995, Tehran and Islamabad signed a preliminary agreement on the construction of "Peace", even four years later to participate in the project joined India. And then the pipeline associated with this game Washington is still ongoing. After all, in the late summer of this year, when it signed the Vienna agreement on Iran's nuclear program when he paid a visit to Chinese President Xi Tszinpina to Islamabad, after which, in fact, "The World" and has acquired real shape, sounded another warning to the US State Department " The sanctions regime with Tehran has not yet lifted.Act 1996, under which any non-US companies that invest in Iran's oil and gas sector of more than $ 20 million a year will be subject to sanctions, has not been canceled.And companies involved in the pipeline project, at any time, there can be problems. "

Most of the intrigue surrounding the Iran-Pakistan pipe

Striving to achieve complete closure of the project and is the essence of the game, which is almost one and a half decades, Washington has waged against the "World." The strategic implications of its implementation were initially unfavorable to the United States. The gas industry of Iran escapes from the clutches of the US restrictions and access to the huge markets of energy in South Asia. The dependence of Pakistan and, consequently, the politicians in Islamabad, by grants from the US weakened. India, with which relations at the time of the signing of agreements for the construction of the "World" in Washington were quite cool, received an additional resource for the industrial breakthrough. Not dependent on energy supplies from the Persian Gulf monarchies, ready at any desired time for the White House and "tap" podzatyanut and play with prices.

In the course went all suitable for use in the economic war. And sometimes it seemed that most intrigue against the United States "the world" is close to a victorious end. Especially in 2009, when India officially announced its withdrawal from the project. Official New Delhi reason this decision announced fundamental differences with Tehran on issues of pricing on gas exports and the lack of guarantees of uninterrupted supply from Pakistan. In fact, Washington was able to negotiate with the ruling Indian elite. And at the strategic level, when we are talking not about the fate of the pipeline without India's support for sanctions against Iran, and the change of New Delhi's foreign policy orientation and turning to partnership with the United States on a wide range of issues, from finance and technology to the defense sphere. Almost India surrendered.

From Islamabad it proved more difficult. And not because of any special anti-American sentiment, but because, firstly, the pipeline was and still is the real salvation of the economy, choking on a lack of electricity. Secondly, the interest in the project has become more and more manifest Beijing. That, however, from time to time tried to intrigue surrounding the Iran-Pakistan pipe not to climb, waiting traditionally the most favorable moment, but constantly "taking the pulse".

However, the pressure on Islamabad grew, and in all directions at once. The White House supported the initiative of then-President Saparmurat Niyazov of Turkmenistan gas pipeline TAPI (Turkmenistan - Afghanistan - Pakistan - India) and offered it to Islamabad as an alternative to the Iran-Pakistan "pipe." But the mythical the project was as obvious as alternative thinking of its initiators, seriously believe that anyone can seriously believe in the safety of complex engineering highways passing through the territory of modern Afghanistan, especially through Herat and Kandahar provinces. In short, a little excited the imagination of experts and politicians, the idea died quietly, only occasionally recalling a particularly extravagant performances themselves "experts."

It is time to replace the carrot on the stick, and Washington first "of freezing" the volume of military supplies to Pakistan, then louder voices of that Islamabad supports international terrorism. And, as a climax, neither the government nor tied to "The World" and the company could not find any funds for the construction of its section of the pipeline or for it to receive loans from the so-called international financial institutions. It is worth recalling that it was almost two billion dollars. Islamabad was on the verge of failure to continue the project, and such a solution is forced and the "fifth column", a powerful pro-American lobby in the country. It added drama in the fact that the Iranian section has already been built. That's just to continue to work at their own expense, have in Pakistan, Tehran could not because of lack of funds in the budget, already tormented with all sorts of sanctions. And then I came on stage to Beijing.

Iran-Pakistan-China - the new axis of "Peace"

In April of this year, Chinese President Xi Jinping arrived in Islamabad. The outcome of his visit was the signing of 51 agreements in the amount of $ 46 billion, most of which involved issues of implementation in the next 10-15 years the project of so-called "China-Pakistan Economic Corridor» (China-Pak Economic Corridor - CPEC). And the pipeline "Peace" will be like one of the links of the corridor, so that in the future, and part of the "new economic space of the Silk Road."

Under the terms of the agreements signed in Islamabad, 85% of financing the construction of the Pakistani section of the pipeline will be financed through the provided specifically for this project of the Chinese loan.At the end point, "World" in the Pakistani port of Gwadar in the near future, no later than the end of 2016, to begin the construction of the LNG plant, to which Beijing has also provided additional funds.

At the same time, in the same Gwadar begin design work for the construction of a refinery with a capacity of 400 thousand barrels per day and the cost of nearly $ 4 billion. On which, as made clear in Beijing, "a place for Iranian oil supplied from the port of Bandar Abbas" (more precisely, from the port complex "Shahid Recai", located 20 kilometers west of Bandar Abbas itself - IP) .

From the interface of the gas pipeline "Peace" with the "Sino-Pakistani economic corridor" all three parties benefit of a strategic nature. Tehran decides whether to diversify export routes for its energy and receives the output on the markets of South Asia, and the prospect of continuing the pipeline to the Chinese territory. This breakthrough is estimated Iran is so high that in his recent speech on the prospects of the gas export Iranian Oil Minister Bijan Zanganeh stressed that the main priority in this regard leadership of the Islamic Republic considers not Europe and Asian markets, implying that obviously opens new perspectives cooperation in this field with China. And creating a foundation for the solution of the most acute problems - to attract billions of dollars of investment in the modernization of the oil and gas industries in Iran.

The project, allowing Pakistan to receive daily about 21 million cubic meters of Iranian natural gas, giving the country's economy to overcome the growing shortage of energy supply. Serious revenue will go to the treasury and Islamabad on gas transit. It is expected that the bulk of the gas is directed into the sphere of power generation, which will increase its production to 5,000 megawatts. At the same time, Pakistani experts have estimated that the use of imported Iranian natural gas instead of LPG will allow annual savings of $ 735 million. According to specialists of the Economic Coordination Committee of the Cabinet of Ministers of Pakistan, use instead of oil and gas from the pipeline "Peace" at thermal power plants of the country will reduce the cost of generating 1 kW of electricity around 30%.

Of course, each of the three parties - Beijing, Islamabad and Tehran - in the case of acquiring even a partial realization of the project is also a serious political benefits that bear, without exaggeration, strategic, substantial shift in their favor the balance of interests in the region. But it's such a big topic, it is better to talk in detail about it separately.

Exhausted retaliatory moves if Washington?

Calculation of Beijing, which became in fact a third party "Peace" logically impeccable and strategically elegant. The gas pipeline may be extended from Gwadar to Kashgar, the capital of Xinjiang Uygur Autonomous Region of China - along the 1300 kilometer Strategic Highway China - Pakistan "Karakorum", the reconstruction of which is also incorporated in the project "economic corridor". It will take place in parallel with the pipeline.

The traditional route of energy supplies by sea, over 12 thousand kilometers, firstly, be reduced to 2395 km. Secondly, it will get rid of the "curse" of Hormuz and the Strait of Malacca, which in the case of conflict, can be blocked by the naval forces of potential adversaries. As rightly said the President of the Islamabad International Affairs Committee, Khalid Mahmood: "Construction of Sino-Pakistani economic corridor will strengthen and facilitate the relationship with the Chinese region of the Persian Gulf, Africa and Europe." That's just the point has not been set. Neither the implementation of the "China-Pakistan economic corridor", or in the completion of "the world."

And sign an agreement in Vienna on Iran's nuclear program and the agreements reached during the September visit to the US President Xi Jinping, Washington will not mean anything when the American ruling elite consider that the Iranian-Chinese "mate" will begin to pose a threat their interests.

The vulnerability of the "World" and "Sino-Pakistani economic corridor" lies in two words - "Balochistan" (that Iran, the Pakistani part of it) and "Xinjiang" (aka - Xinjiang Uygur Autonomous Region of China). Two of these areas, despite their outward differences, have two things in common. And there, and there - are strong separatist tendencies. And there, and there - from time to time, the activating, at the time, as if disappearing into nowhere, there are terrorist groups of Islamic persuasion. Suffice it to recall the differences in the Iranian part of Balochistan transcendent cruelty group "Jundallah". Around which formed a snake tangle foreign sponsors - Saudi intelligence, the Israeli Mossad, the Pakistani fundamentalists and, of course, the CIA.

In the Pakistani part of Balochistan situation is even worse - hundreds of thousands of criminals fleeing here from the entire region, creating a whole camp. And besides, that in Iran, that in the Pakistani part of Baluchistan for decades are well-trodden paths of smugglers and caravans with drugs. And all this at the right time "exploded" under the pretext of "an increase in funding infrastructure programs and the regional economy, solution of social problems of the local tribes," no need to make too much effort.

So the possibility of retaliatory moves Washington is far from exhausted. Separatism, "the struggle for the rights of minorities", "support the liberation movement" and "mass demonstrations Sunnis for their rights" - a weapon, though old, but not lost its destructive power. "Blow up" Xinjiang, of course, infinitely more complicated, but if you think about it.

Tradition To iran.ru portal is obligatory reference to Moscow's position on certain issues or events occurring in bordering regions. We will not violate it, and this time, especially since a lot of the time it did not take.

In one form or another through the Russian Gazprom representatives and officials of relevant ministries, as they say in diplomatic language, "showed interest in the project" since 2007. In May 2009, Russian Deputy Energy Minister Anatoly Yanovsky said that "Gazprom is ready to connect to the gas pipeline project", and - "could serve as the operator and contractor to act in its construction." But all the time something prevented. That angered the Russian side to the Pakistani proposal to join the project contractor on a competitive basis. That document signing frustrated by the failed visit to Islamabad, President Vladimir Putin.

In September 2013, at a meeting with the Minister of Petroleum and Natural Resources of Pakistan Abbasi Deputy Energy Minister Yuri Sentyurin he reiterated that "Russia is planning to participate in a project to supply gas from Iran to Pakistan." No response to any Iranian enthusiasm nor the Pakistani side has not followed. Moreover, local experts unanimously noted in the comments that "the deal on the financing of the project by Moscow or the participation of Russian companies in the construction of the Iran - Pakistan is unlikely to be concluded because of the US position, which will in this matter the pressure on the Russian leadership."And how the water looked - "Peace" will be implemented without Russia's participation.

One of the most important regional events of recent times, the completion of the gas pipeline "Peace", will entail serious consequences for all participants in this project - Iran, Pakistan and China. For Tehran, it would mean not only the diversification of exports, access to the markets of South Asia, and possible investments in the country's gas sector. This may be a completely new stage in its foreign policy and economic activity - the pairing of strategic interests with China, which means that Iran opened a new horizon of political and economic opportunity.

Other articles

Iran-Pakistan pipeline faces headwinds

Iran-Pakistan pipeline faces headwinds

An Iranian worker welds the first joint on a pipeline connecting Iran to Pakistan in 2013. (PA)

Iranian President Hassan Rouhani has pledged to plug the hole in Pakistan’s gas supply via the long-awaited Iran-Pakistan pipeline, but a former Pakistani government official has cautioned Islamabad not to get its hopes up.

Speaking to Interfax Natural Gas Daily last week, Shahid Sattar, former member for energy at Pakistan’s Planning Commission, described Rouhani’s words as "a political statement" and said neither Pakistan nor Iran were ready to fulfill the roles required of them by the project.

"Pakistan is not ready with the infrastructure and, as a result of international sanctions on Iran, there has been no serious drilling there either," said Sattar.

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Iran – Pakistan - India gas pipeline

Iran – Pakistan -- India gas pipeline


The energy Department of India and Pakistan has increased 6% to 7% during the last 15 years.

Iran – Pakistan -- India gas pipeline

Iran has 18% of proven gas result of the world. It stands second to a Shia as far as gas results are concerned in the whole world. Beyond is exporting its guest in the form of LNG or its aspiration to the gas pipelines to different countries of the world since 1990.

The energy Department of India and Pakistan has increased 6 to 7% during the last 15 years. During 2004 - 05, India and seemed approximately 1 30,000,000 pounds of oil, 95,000,000 tons of which was imported. India needs one 50,000,000 m³ of gas daily, white the gas of lacked the country stands only 50% oil the same. It is expected that gas requirement of India will portable in the next 10 years. The decreasing oil results of India have forced India to think about the alternative speedy filled up gaps in the minds and supplies. Therefore, India needs for Gasquet Nordby ignored.

Importing gas from Qatar is 15% closer than blue import from Iran. The condition is much worse in the case of Turkmenistan as it really 20% more expensive. The Iranian gas is more accessible to India and Pakistan from the security point of view. To the gas from Qatar is more dependable, but it's capacity and scalar for 2017. For these reasons, choice of it on its the best.

Technically and economically, implementation of 2700 km long pipeline which will be laid down at a depth of 1.5 m below the ground at a cost of more than $4 billion can bring more than 100,000,000 m³ of gas from Iran could these two countries, India and Pakistan.

Ports of Asaluyeh in Iran -- Gwadar -- Karachi -- Indo Pak border.

Conclusion

1. The proposed terms of agreement will be for 25 years which can be renewed for a further bid of five years.

2. India will save an 2 billion American dollars while Pakistan that they'll get about $400-$600 million as transit fee.

3. Diplomats and experts call the gas pipelines as the pipeline of peace.

4. USA is convincing India not to go for these gas pipeline as America has promised nuclear energy to India.

5. India has a deep mind the cyber age which do not be ruled out in Pakistan territory.

Attachments

Iran-Pakistan gas pipeline to be completed by 2017 - Newspaper

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Iranian welders work on the pipeline to transfer natural gas from Iran to Pakistan, in Chabahar, near the Pakistani border, southeastern Iran. —AP/File

ISLAMABAD: Pakistan on Wednesday said the construction of Iran-Pakistan gas pipeline was currently in progress and would be completed by the end of 2016 or early 2017, but the first shipment of liquefied natural gas (LNG) expected by March 31 this year would be provided to the transport sector.

Speaking at a news conference on Wednesday, Petroleum Minister Shahid Khaqan Abbasi said the negotiations with Iran were in progress to amend the bilateral agreement to cater for the change in gas delivery date from Dec 31, 2014 to 2016-17.

Responding to a question on penalties for delayed project implementation, the minister said penalties have not been imposed as yet by Iran and talks were still going on to amend the agreement to incorporate new schedule.

CNG sector to be first beneficiary of LNG import

He said it was natural for Pakistan to import gas from Iran because it was a cleaner and cheaper fuel that could be easily transported and was currently linked to cities and villages throughout the country and the industry, fertiliser and household had become dependent on gas. “So we see not just one but three or more gas pipelines coming from Iran in the future,” he said.

He added that the government considered different ways to develop the project and finally decided to build 700-kilometre Gawadar to Nawabshah pipeline coupled with an LNG terminal at Gwadar for which the government has nominated a company that has signed a protocol agreement with a Chinese firm to undertake Gwadar-Nawabshah pipeline. The remaining 70km between Gwadar to Gabd border point with Iran would be developed separately by Pakistani contractors.

CNG sector’s revival: Abbasi said petrol crisis was overcome by taking effective measures and the first LNG shipment will reach the country on March 31.

He said the compressed natural gas (CNG) was an important part of the country’s energy mix and efforts were under way to revive the industry as early as possible. He said the first shipment would most probably be provided to the CNG sector.

Responding to a question, he said the government was holding talks with existing independent power producers for conversion to LNG instead of diesel or furnace oil, but he agreed that no decision has been reached yet.

He said the IPPs would not be liable for 100 per cent take or pay of LNG, and gas quantities beyond their need would be diverted to the CNG sector.

To a question, he said sufficient stock of diesel and furnace oil has also been ensured.

The CNG sector has been allowed to import LNG and the government will transport it to provide CNG and alternate fuel to consumers, the minister said. Pressure on petrol would be reduced with the availability of CNG. Additional CNG would also be available soon.

Rising petrol usage: Petrol consumption in the country was increasing with each passing day due to falling prices and selling of 40,000 bikes a month, he said, adding that around 500,000 motorbikes were sold last year.

He said no CNG station would face closure after start of LNG import. The price of CNG would be deregulated and linked to crude oil so that its prices would be 30pc cheaper than petrol. The move will have a positive impact on budget of masses, environment, oil import bill and job market, he added.

He said revival of CNG would help establish an alternative fuel system which will not be affected by petrol scarcity or volatility of the market, hence providing relief to the masses. He appreciated the CNG sector for taking initiative to import LNG to overcome crisis.

‘No GIDC’: “We have offered fiscal incentives for import of LNG so that the once vibrant sector can boom again,” he said, adding that the LNG for CNG would not be liable for gas infrastructure development cess (GIDC) and the sales tax would be kept at 5pc instead of normal GST rate of 17pc.

Ruling petrol crisis in the future, the minister said sufficient stock of diesel and furnace oil had also been arranged. He said arrangements have been made in view of expected reduction in oil prices next month and rising demand of petrol.

Petrol consumption in the country since January 2014 has increased from 9,000 tonnes a day to 15,000 this month, he said. For February, the government has projected an estimated daily demand at 19,000 tonnes.

He said petrol consumption was recorded at 450,000 tonnes this month, and expected to touch 540,000 tonnes next month because of price reduction.

Diesel consumption during the past year also increased by 12pc, and the government was taking all necessary steps to meet the future requirements, he said.

Published in Dawn, January 29th, 2015

Comments (40) Closed

Ridwan Jan 30, 2015 08:01am

@Sunil USA Underwater pipeline from Iran to India is a "pipe dream." Iran would insist on just extending the pakistani pipeline, and india doesn't have the money to pay for an underwater pipeline. Not to mention obvious environmental drawbacks.

India is not part of this project either. It would make sense for India to join, but the real reason India cannot be part of this project is because the USA will forbid India from relying more on Iran, whereas the Pakistanis are relying far less on the USA and far more on China, which wants this pipeline built.

Faruk chowhdry Jan 30, 2015 08:20am

Can Nawaz government compleat this Iran Pakistan pipe line, I don't think so, can Nawaz go Againist USA's wishes, NO, Mushraf couldn't do it, Zardari could do it. This pipe line business is going on for 10 years. Forget India pakistan is at war with India. If the government of Pakistan wants to compleat this deal with Iran can be done soon as, I don't think Nawaz government is capable.