Pakistan might relinquish IPI project

Problems never seem to chase the much-awaited proposed $7.4 billion tripartite gas pipeline project with Iran as Pakistan might also opt out of the project.

Pakistani authorities might recommend to parliament to abandon the Iran-Pakistan-India gas pipeline project as Iran has sought an "exorbitant" $10-11 per mmbtu of gas from Pakistan. Thus, the Pak authorities believe that the project is no longer economically feasible for the country.

The recommendation to abandon the project is likely to be made during a meeting of a steering committee chaired by Asim Hussain, Adviser to the Prime Minister on Petroleum on 16 January 2009 . The committee is set to discuss the pros and cons of the "irrational demand" of Iran with regard to gas prices and other related issues.

After framing recommendations for the future strategy for the pipeline project, the committee will sensitise parliament on the issue and leave it to the House to decide to either continue the dialogue with Iran or to quit the project.

Pakistan and Iran had earlier agreed on a price of $6.66 per mmbtu of gas in December 2007. Also, recommendations have been made to the Pakistan government that instead of the pipeline project Pakistan should opt for "aggressive exploration and production of oil and gas" within Pakistan


Source : www.businessstandard.com