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What Are The Prospects For Iran-Pakistan 'Pipeline Of Peace'?

Iranian President Mahmud Ahmadinejad (left) and his Pakistani counterpart, Asif Ali Zardari, in Tehran on May 24.
Iranian President Mahmud Ahmadinejad (left) and his Pakistani counterpart, Asif Ali Zardari, in Tehran on May 24.
By Bruce Pannier
The signing of a 25-year deal under which Iran aims to export some 150 million cubic meters of gas to Pakistan per day has resurrected a moribund pipeline project known as the "Pipeline of Peace."

Not much has been heard about the Iran-Pakistan-India (IPI) pipeline for some time, but that all changed on the sidelines of a regional summit that brought together Iranian President Mahmud Ahmadinejad and Pakistani President Asif Ali Zardari in Tehran on May 24.

At a signing ceremony, the two leaders hailed the prospects of a pipeline that would start in the Iranian city of Asalouyeh, travel to Pakistan, and could eventually end in India.

But there are some major obstacles to overcome before any Iranian gas actually crosses the border into Pakistan -- and even more before that gas can be routed to India.

The first major question is where the money will come from.

The first leg of the plan is to build a 2,100-kilometer long pipeline from Iran's South Pars gas field into Pakistan -- at an estimated $7.5 billion. The next step would be to build a 600-kilometer extension that would go on to India.

But while a rival gas-pipeline project -- the Turkmenistan-Afghanistan-Pakistan-India (TAPI) -- is supported by the Asian Development Bank, the IPI does not have any backing from international financial institutions. Furthermore, TAPI is not as vulnerable to the financial or political opposition that IPI could experience due to the involvement of Iran, whose nuclear program has made it a pariah in the international community. 

Complicating matters for both projects is that they are to be routed through Baluchistan. Considering that Baluch nationalists have already blown up domestic gas pipelines on the Pakistani side of the border in their fight for greater autonomy from Islamabad, their stance on a new pipeline from Iran (or Afghanistan) could be easily guessed.

As Ahmadinejad and Zardari watched representatives of their respective countries' gas companies ink the deal, the two presidents managed to avoid addressing such difficult questions. Ahmadinejad and Zardari hailed the plan to build a "pipeline of peace," with Zardari pointing to the significance of the signing of the agreement after some 10 years of talks.

Pakistani adviser on petroleum and natural resources Asim Hussain said Pakistan and Iran would sign a formal agreement on the pipeline project within 15 days in a third country. Hussain did not say which country, but given India's longtime interest in the project, it is assumed that it is the "third country."

That leads to more uncertainty, considering New Delhi's difficult relations with Islamabad. Pakistan, however, has made clear it would build the pipeline with Iran even if India opts out of the project. Iranian and Pakistani officials have said construction of the new pipeline could start within three to four years and be finished some five years later.
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by: Haverkamp, Wilfried from: Duisburg/Germany
June 03, 2009 18:41
Sir,<br />I fear some numbers are wrong due to errors converting cubic feet to cubic metres. The true per day value seems to be 750 million cubic feet per day, that is 21,3 million cubic metres per day. This value is consistent with reports of Iranian news agency ISNA, published May 26, 2009:<br />&quot;The two sides have agreed to reduce the volume of gas to 21,5 million cubic meters daily. They had previously decided 30 million cubic meters a day.&quot;. Furthermore, Chinese interests in the proposed IPI pipeline are completely neglected. A fair comparison to the &quot;rival&quot; TAPI project should have included the eminent risks of Afghan transit along the highway from Herat to Kandahar.<br />Kind regards,<br />Wilfried Haverkamp

by: sarwar from: lko
June 06, 2009 07:34
there are more pipelines to china or europe from middle east/central asia than air routes or highways.companies are neglecting potential consumption,hence forth good returns in countries of south asia.there is less danger in baluchistan or kandahar than it is for shell,total,or elf in nigeria,congo or any african country.also stay and stake of america in iraq,afghanistan will go futile if its companies shut their eyes and leave iran,iraq,qatar,china,turkmeinstan,turkey,bulgaria and russia to fill the gallons of gas as they desire for areas where population density is very thinner. mind you, coal cooks the meal more deliciously than gas having odour similar to ammonia

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