Energy Sector - 2

[Naresh]

<!--QuoteBegin-agnivayu+Jan 14 2006, 08:06 PM-->QUOTE(agnivayu @ Jan 14 2006, 08:06 PM)<!--QuoteEBegin-->They made the right decision, why give Pakistan a guaranteed $ 100 mil a year or whatever it was.   Iran is also a wacko mullah state, fit for only loose oily agreements.
[right][snapback]44828[/snapback][/right]
<!--QuoteEnd--><!--QuoteEEnd-->

<b>agnivayu Ji :</b>

The decision is not made yet. <!--emo&:furious--><img src='style_emoticons/<#EMO_DIR#>/furious.gif' border='0' style='vertical-align:middle' alt='furious.gif' /><!--endemo-->

I do not think that Mani Shankar Aiyar – despite his brother’s advice – is willing to give up.

Read his latest Article :

<b>Pipeline lessons from Ukraine : Swaminathan S Anklesaria Aiyar</b>

He has earlier written on the subject and you can read his earlier Articles on http://www.swaminomics.org

BTW : The Annual Transit dues for an Iran-India Natural Gas Pipe Line is <b>USD 600 Million payable to Pakistan!</b>

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[agnivayu]

$600 million is a lot more, for that amount, India will need to spend atleast that much on defense to counteract. India should add about $1 Billion / year to the cost of maintaing the pipeline for additional military spending, and also consider the fact that Pakistan can turn the tap off anytime.
The Indian Oil minister seems like the old psycho-secular brigade. THey are knee jerk anti West, but drool over muslim countries.

[Naresh]

<b>agnivayu Ji :</b>

1. With due respect, I cannot understand where you are coming from when you state that India should add USD One Billion to the cost of maintaining the Pipe Line.

The Pipe Line situated in Pakistan is for the Government of Pakistan to Safeguard and Defend. Do you expect the Government of Pakistan to allow the Indian Army to impinge on Pakistan’s Sovereignty and “Look after the Pipe Line”?

2. Of course the nature of whole exercise of the Pakistani Government is that it wants India to be stupid enough to build a Pipe Line via Pakistan so that Pakistan can turn it off at will.

3. A Pipe Line through Pakistan to India would be the act of a Kalidasa i.e. Chopping the Branch off, one is sitting on, from the Tree’s Trunk.

4. I cannot comment on Mani Shankar Aiyar’s reasons for having a Pipe Line through Pakistan other than to make his “Cambridge Mate” Pani Poori happy.

5. It seems to be on record that Mani Shankar Aiyar is running not only against the policy of the Prime Minister but also against the Defence Minsistry along with the Defence Staff, the Foreign Ministry including the mandarins but also against the advice of the Economic Ministry and its mandarins.

6. Even if the Gas was “sold” at the Pakistan-India border still the shortfall of gas supply, due to a stoppage of supply for various reasons in Pakistan, cannot be made good by supplying LNG as there would be no spare LNG capacity in Iran – all LNG trains are built to supply long time contracts – nor would there be a loading facility available, there would be no LNG Carriers available as at USD 200 Million a pop such a commodity will not be available at the local corner (provisions etc.) store. Finally there would be no spare port capacity to receive such LNG carriers as the Terminals built have a capacity to service for ongoing contracts. One would also not find a Re-gasification Plant lying idle for “Pakistan’s disruption of Natural Gas Supply via the Pipe Line”. Finally there would be a need for additional "Pipe Lines" to transport this "Additiona/" Gas.

As such with the attitude that Pakistan has had towards India, since inception in 1947 and the projected-expected behaviour of Pakistan vis-à-vis India in the next Fifty Years, building a Natural Gas Pipe Line would be an unmitigated disaster. It would be an exercise to test and try the Gods which every human is bound to fail.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Naresh]

<b>Whilst MSA mouths Bhai-Bhai with China Modi learns a Lesson from China and acts Decisively & Positively :</b>

<b><span style='font-size:21pt;line-height:100%'>Shell to sell Australian LNG to GSPC</span></b> <!--emo&:clapping--><img src='style_emoticons/<#EMO_DIR#>/clap.gif' border='0' style='vertical-align:middle' alt='clap.gif' /><!--endemo-->

<b>MUMBAI : Shell will ink an initial deal on Wednesday with India's Gujarat State Petroleum Corp. to supply 14 mn tonnes of LNG from a Chevron-run project in Australia in which Shell has a stake, a source close to the deal said on Monday.

"Shell will supply 700,000 tonnes (a year) of LNG for 20 years to Gujarat State Petroleum from its merchant terminal in Hazira," the source, who did not wish to be identified,said.</b>

Royal Dutch Shell Plc holds 25 per cent of Australia's Gorgon LNG, as does Exxon Mobil Corp. , while operator Chevron Corp. owns the remaining 50 per cent.

The deal with Gujarat State Petroleum, Shell's sole Indian customer for liquefied natural gas (LNG) so far, follows the breakdown in talks between China's CNOOC and Chevron late last year over pricing of LNG from Gorgon.

Gujarat State Petroleum declined to comment. Shell officials in India could not be reached for comment.

<b>The source said Gujarat State Petroleum had negotiated the LNG contract with Shell's Indian unit at about $4.50 per mn British thermal units, for supply from 2010 onwards.</b>

Shell has an annual share of 2.5 mn tonnes of LNG from Gorgon, due to start shipping in 2010, and said last year that it would ship its entire share to a new import terminal to be built in northern Mexico to supply the U.S. West Coast.

Chevron has committed most of its share of LNG supplies to Japanese firms, signing sales deals with Chubu Electric Power Co for 1.5 mn tonnes a year, Japan's Osaka Gas Co. for 1.5 mn tonnes and Tokyo Gas Co for 1.2 mn. That leaves it 800,000 tonnes of annual supply to market.

YEMEN, MALAYSIA SUPPLY

The source said Linda Cook, Shell's executive director (gas and power), would sign the preliminary deal on Wednesday with Narendra Modi, chief minister of the western Indian state of Gujarat, in its capital, Gandhinagar.

He said Shell would also soon sign contracts with Malaysia's Petronas and Total SA's Yemen LNG Company for supply of LNG to its 2.5-mn-tonne LNG terminal in Hazira in Gujarat.

<b>Shell is negotiating a 15-year contract with Petronas for 10.5 mn tonnes of the super-cooled and compressed gas beginning 2007/08, the source added. Shell is looking at a short-term contract with Yemen LNG for 700,000 tonnes annually, also from 2007/08.</b>

Industry sources say that after the expiry of its first contract with Gujarat State Petroleum last month, Shell's Hazira terminal has been operating significantly below capacity because Indian gas price controls made it hard for it to find buyers of gas at international market rates.

Early this month, Shell admitted it had been approached by several parties interested in taking a stake in the terminal.

While Total already owns a 26 per cent strategic interest in the terminal, India's state-run Hindustan Petroleum Corp. Ltd. and Oil and Natural Gas Corp. Ltd. have expressed interest in picking up equity in the project.

India is promoting LNG imports and is also in talks to build pipelines to bring natural gas from Iran, Turkmenistan and Myanmar as gas usage increases in the energy-hungry economy.

<b>India plans to import 7.5 mn tonnes of LNG a year from Iran, starting in 2009 and running for 25 years.</b>

Now MSA should take <b>Chinese Lessons</b> from Modi!

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[agnivayu]

<!--QuoteBegin-Naresh+Jan 15 2006, 05:31 AM-->QUOTE(Naresh @ Jan 15 2006, 05:31 AM)<!--QuoteEBegin--><b>agnivayu Ji :</b>

1. With due respect, I cannot understand where you are coming from when you state that India should add USD One Billion to the cost of maintaining the Pipe Line.

[right][snapback]44862[/snapback][/right]
<!--QuoteEnd--><!--QuoteEEnd-->


If Pakistan get's several hundred million dollars in cash each year, then no doubt this money will be ploughed directly into their defense budget.

To counteract this growth in their defense budget, India will have to raise it's defense budget by atleast that much (probably more), therefore the 1 Billion.

I heard the Pakistani prime minister on C-SPAN stating that their defense budget as a % of GDP is declining. I think this is because of U.S. military aid which is both to prop up Pakistan, but is also a subsidy for US defense contractors.

[Naresh]

<b>agnivayu Ji :</b>

Thank you for your clarification.

I would feel that the USD 600 Million paid to Pakistan as Annual Transit dues should entail an additional expense of at least Four Times for the Indian Defence – India is four Times the Size of Pakistan – up to may be Seven Times, Indian Economy and Population also India’s Coast Line and the corresponding Air Space is Seven Times that of Pakistan, and as such this annual earning of USD 600 Million could cast a burden of USD 2.4 Billion to USD 4.2 Billion on the Indian Annual Defence Budget-Spending.

In respect of Pakistan’s annual Defence Budget-Spending I refer you to the Two Interviews by Dr. Ayesha Siddiqa to the Editor of Des Pardes :

<b>First Interview : A full General is worth Rs 500 million+</b>

<b>Second Interview : 'Nukes deterred Indo-Pak war'</b>


<b>Additional Reading : Pakistan military runs 55 firms</b>

I quote from Dr. Ayesha Siddiqa’s First Interview :

<b>irshadsalim28: What was the defense budget for the year 2001?

asidd66: 131 billion. If u add these numbers the budget would escalate to over Rs. 400 billion</b>

If the Pakistan Defence Budget for the Year 2001-1002 was Pak. Rs. 400 Billion then at a Conservative Annual Increase of 15% the Pakistani Annual Defence Budget for the Year 2005-2006 would amount to Pak. Rs. 700 Billion i.e. about USD 12 Billion – this is a realistic Figure.

The Actual Pakistani Defence Budget Allocation may be USD 4 Billion to which one must add the USD 8 Billion that the Pakistani Armed Forces Owned Commercial Enterprises make in terms of Annual Profits.

<b>Regarding Short Cut statement on C-SPAN that their defense budget as a % of GDP is declining :</b>

In 2002-2003 Pakistan’s GDP was about USD 68 Billion.

The Pakistanis then went in for “Re-Basing” their GDP on the latest values and so the Pakistan GDP for 2003-2004 became USD 95 Billion or so and the 2004-2005 GDP has increased to USD 110 Billion. I am sure that Pakistan’s GDP for the Year 2005-2006 will reach the Figure of USD 125 Billion.

This re-working of GDP has not increased any Tax Receipts of the Pakistani Government. All it has done is to bring in “New Sectors” (since the previous Calculation Base Date) into the GDP Calculations.

The advantage of this “Re-Working” is that in 2002-2003 Pakistan’s Internal Debt was USD 35 Billion also the External Debt was about USD 35 Billion – thus the Debt was over 100% of the GDP.

At that time the Official so Called Annual Defence Budget was USD 3.5 Billion or so i.e. over 5% of the GDP.

With the re-workings of the GDP Figures Pakistan’s Total Debt is now USD 70 Billion i.e. about 64% of the GDP – this helps especially as now the Foreign Debt is 32% of the GDP where as in 2002-2003 it was over 50%.

Similarly the Official so Called Annual Defence Budget in 2005-2006 is about USD 4 Billion or so i.e. about 3.6% of the GDP.

I hope you understand the “Hanky-Panky”.

This Hanky Panky has no real bearing as there is no Physical “Immediate” Increase. This increase has been over the full period from the previous “Valuation” Date.

As such Pakistan will still remain an International Beggar and keep begging for Arms from Uncle and Ummah, Economic Aid from the World etc. etc.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Guest]

<!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>Pipeline or pipedream? : Imtiaz Gul </b>
Fridaytimes.com
US pressure on Pakistan and India to get out of the gas pipeline deal with Iran is now becoming overt and pronounced 
   
On the face of it, the Jan 23-24 technical-level talks between Iran and Pakistan on the Iran-Pakistan-India gas pipeline went well.Pakistani Petroleum Minister Amanullah Khan Jadoon and his Iranian counterpart Nejad Hossenian led their respective delegations at the two-day Joint Working Group (JWG) meeting and agreed on a trilateral ministerial meeting – also involving the Indian petroleum minister – on the project in April. The Iran-Pakistan JWG will also meet in March before the trilateral talks.

“The petroleum ministers of Iran, Pakistan and India will meet in Tehran in April for further discussions on the project,” said a joint statement at the end of the fifth JWG meeting on the proposed 2,670-kilometre long gas pipeline, worth over 4.5 billion dollars.

During the talks, both sides discussed the project structure, framework agreement, principles of gas pricing mechanism, feasibility study and gas sales and purchase agreement, with Pakistan still pursuing a two-track policy, i.e., either with or without India. The sans-India agreement is being pursued because until the April meeting takes place, it will not be clear whether India is on board or not.

For his part, the Indian petroleum minister Mani Shankar Aiyar continues to say the project is on tracks. However, no less a person than the Indian Prime Minister Dr Manmohan Singh cast suspicion on the feasibility of the project after he signed a nuclear deal with the United States in April 2005. He was seen to have done so largely under US pressure.

However, if India does remain a part of the deal, the three parties would sign a Tripartite Framework Agreement in Tehran in April after their respective sub-technical groups negotiate the technical issues of the project.

Despite heavy odds looming over his country, Nejad Hossenian, the Deputy Petroleum Minister of Iran, sounded optimistic and said his country would sell gas to buyer countries in accordance with the international market rates. Hossenian also said Iran would not abandon the project even if the US or the United Nations slapped sanctions on Iran.

However, the Iranian minister’s resolve and optimism, notwithstanding, certain developments in Washington as well as here have removed whatever little doubts existed earlier about the Bush administration’s opposition to the project.

While in New York, Prime Minister Shaukat Aziz made it clear that Pakistan would decide about the project after the nuclear issue of Iran was solved. (Interestingly, Secretary Petroleum and Natural Resources, Ahmad Waqar, told reporters in Islamabad on Jan 24 that he was unaware of Aziz’s New York statement.)

Dr Salman Shah, Aziz’s finance advisor, also added to the doubts by telling the media in Karachi that “being a member of the United Nations, Pakistan shall have to abandon the gas pipeline project if Iran was sanctioned.”

What is more damning compared to these statements flowing from the Pakistani side, however, is what US Undersecretary of State Nicholas Burns said before leaving Islamabad on Jan 22. “We respect both India and Pakistan’s quest for new sources of energy but I do not think this project [IPI] should be pursued,” Burns told a private TV channel.

Burns called the project unfeasible and said that India and Pakistan should look for a third country. He even named some central Asian republics as a source of cheap energy. “Iran is adverse to the United States, is against Israel, and is pursuing nuclear weapons,” he said.

Meanwhile, on the nuclear deal with India, he said it was “unique” and the United States could not offer a similar deal to Pakistan. “We offered the unique deal to India because it did not proliferate,” Burns said when asked as to why Pakistan, which too needs alternative sources of energy, is being discriminated against.

Although Ms Tasneem Aslam, the foreign office spokesperson, brushed aside Burn’s statement saying planning for its energy requirements is Pakistan’s sovereign right and buckling under foreign pressure on this count is out of the question, yet, only a day before the Iranian delegation arrived in Islamabad, Nicholas Burns managed to inject uncertainty into the talks by venting his country’s opposition to the IPI project.

Despite Burn’s categorical statement, Pakistani officials say the project stays on course, come what may. The reality may be different and the situation will become clearer come April
<!--QuoteEnd--><!--QuoteEEnd-->

[Naresh]

<b>Mudy Ji :</b>

Pakistan going in for an Independent Natural Gas Line from Iran is all Bluff and Bluster.

Pakistan’s requirement is only 500 Million Cubic Feet per Day and as such it is uneconomical to build a Pipe Line for such a small quantity.

Both MSA + Ilk as well as Uncle Sam may just fall for it but believe me such a Pipe Line is a no go.

Cheers

[Naresh]

<b><span style='font-size:21pt;line-height:100%'>MSA TUSH MUSHED</span></b> <!--emo&:clapping--><img src='style_emoticons/<#EMO_DIR#>/clap.gif' border='0' style='vertical-align:middle' alt='clap.gif' /><!--endemo-->

<b>New faces in Manmohan's cabinet</b>

NEW DELHI: Murli Deora, a Congress veteran from Mumbai, is the new petroleum minister, Vayalar Ravi, another old-timer from Kerala, is the overseas Indian affairs minister and Abdul Rehman Antulay takes over as the new minister of minority affairs in the first major reshuffle of the Indian cabinet here Sunday.

In the much-awaited reshuffle, Prime Minister Manmohan Singh made no changes in the key ministries of external affairs, defence, home and finance, retaining charge of the foreign ministry himself possibly because he could not get a suitable person to steer the country's foreign policy at a time when major visits, like those of French President Jacques Chirac and US President George W. Bush are round the corner.

In all 22 new ministers - including seven cabinet ministers - were administered the oath of office by President A.P.J. Abdul Kalam in a ceremony in the Ashoka Hall of Rashtrapati Bhavan, the presidential palace. The wide-ranging changes affected 30 ministers and their portfolios.

Three ministers of state promoted to the cabinet rank and sworn in were Santosh Mohan Dev (heavy industries), Kapil Sibal (science and technology) and P.C. Gupta (company affairs) All three had held independent charge.

<b><span style='font-size:14pt;line-height:100%'>The prime minister took away petroleum from Mani Shankar Aiyar <!--emo&:flush--><img src='style_emoticons/<#EMO_DIR#>/Flush.gif' border='0' style='vertical-align:middle' alt='Flush.gif' /><!--endemo--> in an indication many say is due to his penchant for taking independent decisions that were somehow out of tune with the government's stand and gave it to first-time minister Deora, who is one of the most well-networked Indian politicians internationally.</span></b>

Manmohan Singh appointed Antulay, another party veteran from the days of former prime minister Indira Gandhi, as the government's first ever minority affairs minister while Vayalar Ravi, another senior leader from Kerala, has been named overseas Indian affairs minister at a time when the government is trying to increasingly connect with the 25-milllion Indian diaspora and draw on its talent and resources.

Other new cabinet ministers are Ambika Soni (tourism and culture), Sushilkumar Shinde (power), Saifuddin Soz (water resources) and Shibu Soren (coal).

G.K. Vasan, Renuka Chowdhury and Oscar Fernandes have been made ministers of state with independent charge. Vasan, from Tamil Nadu, is the son of late Congress stalwart G.K. Moopanar who at one time was a contender for prime minister before I.K. Gujral became the consensus candidate in 1997.

Anand Sharma, the Congress party spokesman, is a minister of state for external affairs as one of two junior ministers to the prime minister. E. Ahamed remains the other minister of state (junior minister) for external affairs, while Rao Inderjit Singh, who was minister of state for external affairs, has been shifted to defence.

Other ministers of state who have been appointed are Jairam Ramesh, T. Subbirami Reddy, Pawan Kumar Bansal, Ajay Maken, M.M. Pallanraju, Chandrashekhar Sahu, Akhilesh Das, Ashwani Kumar, Purandeshwari Devi and E.V.K. Elangovan.

The list was finalized after exhaustive meetings over the last two days between Manmohan Singh and Sonia Gandhi, who is also chairperson of the ruling United Progressive Alliance.

Political observers say the changes bear the stamp of party fealty with those who have served the party loyally for long being rewarded with key ministerial responsibilities.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Naresh]

<b>India’s new oil minister poised for pipeline diplomacy</b>

India’s new oil minister is likely to adopt a less strident approach to an Iran-Pakistan-India gas pipeline project that could threaten the country’s relationship with the US.

Manmohan Singh, the prime minister, removed Mani Shankar Aiyar, the controversial minister of petroleum, in a cabinet reshuffle at the weekend, replacing him with Murli Deora, a senior Congress party leader from Maharashtra. Mr Deora’s appointment is likely to be privately welcomed in Washington, where he is a familiar and friendly figure.

Analysts attribute Mr Aiyar’s ousting to his vociferous support for the pipeline, to which the US is opposed. His vehemence was likely to have rankled with the US at time when it was trying to garner support for United Nations sanctions against Iran’s nuclear programme, they said.

While New Delhi is loath to jeopardise a pipeline that will help overcome India’s chronic energy shortage, it has a competing desire to clinch a nuclear co-operation deal that would see Washington help India with a civilian nuclear energy programme, reversing its 30-year-old sanction of India’s nuclear capabilities.

The appointment of Mr Deora comes at a particularly sensitive moment, as India is under pressure to join the US in voting against Iran’s nuclear programme at Thursday’s International Atomic Energy Agency meeting in Vienna.

Analysts say India is likely to demonstrate its independence from the US by abstaining from the vote, and comments from the country’s new oil minister saying the IAEA vote is directly related to energy security point to such an outcome. “The upcoming IAEA vote affects the petroleum ministry more than any other ministry as it has a direct impact on energy security of the country,” Mr Deora said yesterday.

Mr Deora refused to address the Iran pipeline deal specifically but said: “Some of the policies [of Mr Aiyar] would continue while some may need change.” He added, however: “I will continue to steer the ministry to achieving this strategy of ensuring the fuel supplies and energy security of our nation.”

The appointment of Mr Deora, who has close ties to both Washington officials and India’s private-sector executives, is a balancing act, according to political commentator Pran Chopra. “India is not giving in on the pipeline idea but it may go slower on it,” he said. “By abstaining from the vote, it’s giving one gesture to Iran, and by changing the petroleum portfolio, it’s giving another gesture to the US. We don’t want to abandon Iran and we don’t want to cause offence to America.”

Mr Deora’s appointment may also help on the domestic front. While Mr Aiyar aggressively lobbied for India to shore up energy resources both in India and from abroad, he frequently clashed with the heads of public sector companies, such as Subir Raha, chairman of the Oil and Natural Gas Corporation (ONGC).

Analysts say Mr Deora is likely to take a more diplomatic approach. [b][blue]“Despite his overt enthusiasm, [Mr Aiyar] was seen as a bit of a hindrance,” says Abheek Barua, chief economist at ABN-Amro Bank.[b][red] “He rubbed PSU [public sector undertaking] chiefs up the wrong way.”

Mr Aiyar took the ONGC to task for not being efficient enough on oil exploration within India, which imports two-thirds of its energy needs. “It’s best not to have an overbearing minister breathing down their necks,” says Mr Barua.

Mr Aiyar, who has been sidelined with his appointment as minister of youth and sports affairs, expressed confidence in his successor. He said: “I’m sure he will live up to the prime minister’s expectations. The government has not changed so I’m sure the policy will remain steady.” He refused to comment on his dismissal, saying only that it was the prerogative of the prime minister to select his own cabinet.

The prime minister’s cabinet reshuffle mainly focused on smaller portfolios, but analysts said it was notable that he filled ministerial rank vacancies with longstanding Congress party leaders, demonstrating the government’s commitment to an economic reform process that has been stalled by leftwing parties in its ruling coalition.

“It represents an increasing assertiveness by the Congress to put old hands in the cabinet,” said Peter de Souza, a senior fellow at the Centre for the Study of Developing Societies.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Naresh]

<b>The IPI gas pipeline is going nowhere</b>

<b><i>India seems to be the weakest link</i></b>

<b>KARACHI : The most significant change in the recent cabinet reshuffle by Indian Prime Minister Manmohan Singh was the removal of Mani Shankar Aiyar from the portfolio of petroleum and natural gas.

His shift comes at a time when the United States is putting the heat on both India and Pakistan to look at other alternatives for sourcing its gas needs. America is opposed to the $6 billion proposed Iran-Pakistan-India pipeline project on grounds that it wants to continue economic sanctions against Iran.</b>

The gas pipeline project is guaranteed to not only break Iran’s economic isolation somewhat but also make it a more important player in the region. This is something that the US has said that it does not want.

<b>The weakest link, if one may call it, was supposed to be Pakistan in terms of looking at other sources of gas in the region. America wields much more influence in Islamabad and it was expected that any change of mind would have come from Pakistan on this proposed project.

Instead, after the December 31, 2005 deadline (after which Pakistan was to decide whether to opt for Iran or Turkmenistan), President Musharraf made a public commitment to the Iran project. Unfortunately, the most vocal supporter of the project as well as the one with the best credentials, <span style='font-size:14pt;line-height:100%'>Mani Shankar Aiyar, was removed from his position.</span></b>

This seems to be a strange move considering that Mr Aiyar had actually done a lot in terms of sourcing oil and gas for India. Like all things in the sub-continent, he was sacked for doing a good job.

In an interview in 2005, Aiyar had said that both Pakistan and India are major consumers of natural gas and are willing to pay market rates for adequate and uninterrupted supply. "We are the choosers. The sellers will have to come to us," he commented.

Under Aiyar’s term, Pakistan and India along with Iran had made considerable progress in the IPI project over the past three years or so. The overland route had been decided and talks were to start on how to finance and build the pipeline.

The Indian opposition leader, Jaswant Singh, in Karachi over the week feigned ignorance over the reasons behind Aiyar’s removed. He said in an interview that he would have to examine fully the reasons behind Aiyar’s transfer to the sports ministry before making a statement.

In the same breath, Singh was also critical of the continued American interference in South Asian affairs.

Despite being in rival political camps, Singh and Aiyar worked together in 1996 on the IPI gas pipeline project as part of the study group.

In 1996, a joint India-Pakistan study group presented a report to the Indian Foreign Secretary recommended the overland route after setting out the steps that could be taken to ensure security of supplies even in the event of hostilities.

Jaswant Singh’s participation in the study group as that of Aiyar was as an individual. The initiative to convene the study group was taken by Shirin Tahir-Kheli, an American of Pakistani origin whose father was one of P V Narasimha Rao’s gurus in the old Nizam’s Hyderabad.

Tahir-Kheli was on the staff of the US National Security Council and is the only American of South Asian origin to have served as a US ambassador to the UN. The Pakistani side included one of Benazir Bhutto’s ministers of state and Shahid Khaqan Abbasi, Pakistan MNA and PIA chairman.

Despite the recommendations of the group, the project remained under wraps till a couple of years back. Economists argue that the proposed gas pipeline will bring India, Pakistan and Iran a significant step closer in terms of their economic cooperation.

For its part, the US has given the Dauletabad gas fields in Turkmenistan as an alternative. Known as the Trans Asia Pipeline (TAP), this project was earlier mooted by an American led consortium. However, regional politics came in the way and shelved the project.

Regardless of which project Pakistan goes for, the bottom line is that a decision has to be taken quickly so that our gas requirements for the future are met. If this is not done in the next decade or so, industry as well as the common man will suffer greatly as a consequence.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Guest]

<b>Saudi nervous that US doesn't want its oil</b><!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Saudi Arabia, the de facto leader of the Organization of Petroleum Exporting Countries, plans to boost production capacity from 11 million barrels per day to 12.5 million bpd by 2009.
....
"What concerns us is all the talk about not wanting our oil," Naimi said. "It's not a major bump; it's something to take into consideration."<!--QuoteEnd--><!--QuoteEEnd-->

[Guest]

<b>India supports Iran pipeline: Delhi to join Turkmenistan plan: Jadoon</b>
<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Mr Jadoon allayed Indian fears that troubles in Balochistan and <span style='font-size:14pt;line-height:100%'>occasional blasting of pipelines by violent groups </span>  <!--emo&:roll--><img src='style_emoticons/<#EMO_DIR#>/ROTFL.gif' border='0' style='vertical-align:middle' alt='ROTFL.gif' /><!--endemo--> elsewhere would affect the security of the project.

“Pakistan is serviced by a 10,000km network of gas pipelines,” he said. “There have been unfortunate incidents here and there, but our main arterial conduit has remained untouched. So we are confident and remain undeterred.”

Islamabad endorsed India’s full membership in the Turkmenistan-Afghanistan-Pakistan pipeline project. “It is TAP today, but soon it would be TAPI,” Mr Jadoon disclosed.

A joint statement after the talks charted the road ahead, including the option for a submarine pipeline conduit from Qatar.

The statement said the two ministers met in order “to carry forward the dialogue between the two countries on the Iran-Pakistan-India3 Gas Pipeline Project.”......
.....
The two sides agreed to pursue the Gulf-South Asia pipeline project from Qatar.<!--QuoteEnd--><!--QuoteEEnd-->

This is free entertainment.

<!--emo&tupid--><img src='style_emoticons/<#EMO_DIR#>/pakee.gif' border='0' style='vertical-align:middle' alt='pakee.gif' /><!--endemo--> They just want pipeline from somewhere to Pakistan and somehow Bharat should buy gas.

[Guest]

<b>India, Oil and Nuclear Weapons</b><!--QuoteBegin-->QUOTE<!--QuoteEBegin-->SYNOPSIS: There is no diplomatic quick fix in this energy-hungry world. Even if India shunned Iran, it would still have to turn to other petroleum suppliers that Washington wants to isolate, including Sudan and Venezuela. 
Exploding at the seams with building, investment and trade, India can hardly keep up with itself. Airplanes coming into Delhi and Mumbai routinely end up circling the airports for hours, wasting precious jet fuel, because there are not enough runways or airport gates. City streets originally built for two lanes of traffic are teeming with four and sometimes five lanes of cars, auto-rickshaws, mopeds, buses and trucks. This energy-guzzling congestion will only become worse as India continues producing fairly high-quality goods and services at lower and lower prices — from automobiles that cost only $2,500 to low-budget airline flights for $50.

..................<!--QuoteEnd--><!--QuoteEEnd-->

[Guest]

Going in for the pipeline is no big deal as still India will have to tap several other sources of supply. In case, something goes wrong with Iran pipeline and sully gets stopped,India should have enough alternative sources in position . That should be our policy as far as energy security is concerned.
Mynmar has already sent a reminder to India to speed up the proposed gas line project as other takers pf the deal are already in the horizon. In fact, getting Bangladesh involved in this project needs to be avoided and work on the pipeline from Mynmar to India needs to be started immediately.We already have a oil pipeline from Bongaigaon in Assam to Kanpur in UP via Baruni in Bihar. This pipeline needs to be modified , if necessary to bring in the natural gas from Upper Mynmar oil and gas fields. The present idea fo having a new pipeline along a new alignment through Bangladesh will end remain a non starter, given the strong anti-Indian feeling amongst the people of Bangladesh.

[Naresh]

<b>Ravish Ji :</b>

AA : Pipe Line via Pakistan :

The disruption of the flow of Natural Gas through a Pipe Line via Pakistan for a Period of Four Weeks would lead to a loss of Five Per Cent of India’s GDP as per the following Article :

THE PIPELINE PERPLEXITY : DR. BHASKAR DASGUPTA

http://www.hindustantimes.com/news/5983_52...04300140003.htm

In case you cannot access the Hindustan Times Archives for the Article please let me know and I will either Post the Article here or E-Mail to you.

BB : Pipe Line from Burma

1. The shortest and safest route for the Sitwe (Akyab) to Kolkata Natural Gas Pipe Line is via the Shallow Water Sea Route – Maximum Depths around 200 Metres – from Sitwe (Akyab) to the Eastern Channel L.V Lat. 21°04'19" N Long. 088°11'07" E and thence North to Kolkata.

This Route is outside the Bangladesh Territorial Limits of 12 Miles but most definitely passes through the Bangladesh Exclusive Economic Zone through which Marine Pipe Lines – like normal Ships – have a Right of Innocent Passage without the need to pay any dues.

2. The Pipe Line from Bongaigaon in Assam to Kanpur in UP via Baruni in Bihar is for the Carriage of Oil and is of a Size (Oil is much more dense than Natural Gas) which would be too small to carry any amount of Natural Gas to justify economically.

In additions the Natural Gas Pipe Lines have to be of a Greater Wall Thickness as even a Land Pipe Line would be transporting Natural Gas at around 150 Atmospheres.

Thus a Land Pipe Line from Sitwe (Akyab) to Kolkata via Bongaigaon would have to be a newly built Pipe Line dedicated for the transportation of Natural Gas.

B T W : Despite the Dangerous Situation in Bangladesh our "Special Peace Loving Leaders" will most probably drop their everything and construct the Pipe Line via Bangladesh as as there are bent upon building a Pipe Line via Pakistan.

<b>Never Forget : Pipe Lines follow Peace as <span style='font-size:14pt;line-height:100%'>Peace does not follow Pipe Lines.</span></b>

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Guest]

I am in agreement with the points made by you above. However, I beg to make the following observation on the possibility of a pipeline from Mynmar. The proven oil and gas fields in Mynmar is around Mytilla and Mandlay. The overland pipeline alignment into India will be the best and most economic option. You may be aware that underwater pipeline is always expensive than overland pipeline. Natural gas is not the only product that can be imported from Mynmar. It is quite possible to get even crude petrolium from Mynmar into India. It is unfortunate that we always look to the West first and neglect the East.

[Naresh]

<b>Ravish Ji :</b>

In respect of Myanmar I have only been referring to the Off Shore Gas Fields in the vicinity of Sitwe where the Indian Consortium holds a 30% Interest. In this respect there was a News Item stating that this Gas has been sold-apportioned to China. If this Gas is available to India then the Shortest and Safest Route is the Shallow Water Pipe Line.

Mandalay – Sitwe – E C Light Vessel – Kolkatta Route is about 500 KM less than Mandalay – Nowgong – Shiliguri – Kolkata (Avoiding Bangladesh Territory) Route.

Mytilla : Sorry – I cannot locate it on the Map.

IMO : You should not worry about the Indians not looking to the East. If the News Item about Myanmar having allocated the Sitwe Off Shore Gas to China is correct then I think it is inability of the Indians to negotiate sensibly – The Iranian Fiasco is a Farce when one sees the Indians negotiating a contract for LNG or Natural Gas subject to the Approval of the Iranian Parliament.

Take the case of India. The MMTC – an Indian Government Undertaking – has sold Hundreds of Millions, may be over a Billion, Tonnes of Iron Ore and there has never been a Stipulation of the Contract being subject to the Indian Parliament’s Approval.

May be you can educate me (I am not being facetious) about Sale or Purchase Negotiations being subject to an Approval of the Selling or Buying Country’s Parliament.

Regarding the Costs Comparison between Land and Shallow Water Pipe Lines : If the Land Pipe Line is 500 KM longer than a Sea + Land Pipe line in respect of Mandalay – Kolkata then I think the Shorter Land + Marine Pipe Line should cost the same as the Longer Land Only Pipe Line.

Let us watch with interest the Myanmar Government allocating the Sitwe Off Shore Natural Gas to India first before we can discuss its Logistic Details.

I would agree with you that India should also import Oil from Myanmar - of course it being subject to Myanmar willing to sell its Oil to India.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Naresh]

<b>Ravish Ji :</b>

Here is an Interesting Article :

<b>India spreads its net for gas, any gas</b>

NEW DELHI - While efforts are under way to seal nuclear deals with the US and France to generate electricity, India's efforts to tie up gas resources as another alternative to fossil fuels have gathered momentum.

<b>Following the decision by Myanmar to supply gas to China, India is now making swift maneuvers to ensure that the US$1 billion Myanmar-Bangladesh-India (MBI) gas pipeline materializes.</b> And significantly, India has virtually decided to join the US-backedTurkmenistan-Afghanistan-Pakistan (TAP) pipeline, in part because of the geopolitical difficulties involved in the $7 billion Iran-Pakistan-India (IPI) pipeline that Washington opposes.

<b>Paradoxically, New Delhi has found an uncommon ally in Islamabad, which is pushing for India's involvement in the TAP as well as the IPI.*</b>

<b>Gas on TAP</b>

This month, Delhi for the first time took part as an observer in a meeting of the steering committee of the TAP project. Now it appears ready to sign on as a participant in the Washington-backed $3.5 billion gas pipeline as an alternative to the IPI.

Prime Minister Manmohan Singh had discussed the IPI proposal with Petroleum Minister Murli Deora and his Pakistani counterpart, Amanullah Khan Jadoon. Jadoon reiterated Islamabad's commitment to the IPI, despite US misgivings, and at the same time extended support for India's bid to join the TAP.

While India, Pakistan and Iran go through the motions of pursuing the IPI project, apparently unaffected by the International Atomic Energy Agency's referral of Tehran to the UN Security Council, most observers claim that the prospects of the pipeline materializing are now remote. Despite domestic political pressures, India has so far sided with Western powers against Tehran pursuing an independent nuclear program.

In this context, India was an observer at the recent TAP meeting in the Turkmen capital Ashgabat. Dinsha Patel, minister of state for petroleum and natural gas, led the Indian delegation and expressed willingness to join the TAP. A memorandum of understanding (MoU) was signed at the conclusion of the two-day meeting, under which Turkmenistan will supply 3.2 billion cubic feet gas per day to Pakistan for a period of 30 years.

India is closely studying the project's geopolitical, financial and technical aspects. Afghanistan and Pakistan have been seeking India's participation as vital for the TAP's viability.

"We have 90 days to get necessary official approvals to join the project. Once approved by the cabinet, the project will be renamed TAPI," for Turkmenistan-Afghanistan-Pakistan-India pipeline, Deora said in a statement. According to reports, the Oil Ministry will now seek government approval for joining the project within the next three months.

New Delhi, it seems, is satisfied with the availability of gas resources as well as the viability of the project, which has the backing of the Asian Development Bank. The TAP would stretch from the Turkmenistan-Afghanistan border in southeastern Turkmenistan to Multan, Pakistan (1,270 kilometers), with a 640km extension to India.

Importantly, TAP does not involve Iran or the US, which means none of the geopolitical problems involving the IPI. The TAP not only provides a southern exit route for land-locked Central Asian gas that will not have to cross Iran or Russia, it is also an important cog in Washington's Afghan rehabilitation plan as it will earn substantial transit fees.

Turkmen Oil, Gas and Natural Resource Minister Gurbanmyrat Ataev said that Ashkhabad considered TAP to be a priority gas export route. "This market is attractive first of all because of its closeness and rapid growth in consumption and secondly because Turkmenistan, as a neutral state, can in fact help strengthen regional cooperation and increase the economic prosperity of the people in the region."

With potential hydrocarbon reserves of over 45.44 billion tonnes of oil equivalent, Turkmenistan can significantly increase supplies to the international market.

<b>Mired in Myanmar</b>

<b>Irked by the delays in implementing the Myanmar-Bangladesh-India pipeline, Myanmar recently inked an MoU with PetroChina to supply 6.5 trillion cubic feet (tcf) of gas from Block A of the Shwe gasfields in the Bay of Bengal for over 30 years.

The decision came as a major blow to India's bid to tap gas from its eastern front. It also marked one more victory for Beijing energy giants, which have consistently been beating Indian energy firms in the acquisition of oil and gas reserves around the world. India's state-owned oil giant Oil and Natural Gas Corp (ONGC) has lost to Chinese companies, in Kazakhstan, Ecuador and Angola.

Now, with Block A-1 gas going to China, the cost of the MBI will increase as the available block close to Bangladesh is A-2, which will require an additional 150km of pipeline for the gas to reach India.</b>

This has provoked India to appoint Brussels-based Suz Tractebel as technical consultants to study a different route for the pipeline through the northeast, bypassing Bangladesh. The European infrastructure consultants appointed by the Gas Authority of India (GAIL) have been briefed to "carry out a study for preparing a detailed feasibility report, an environment management plan and a rapid risk analysis study via the northeast Indian territory", the Ministry of Petroleum announced.

GAIL is also exploring the idea of transporting gas from Myanmar via the sea. According to reports, GAIL is planning to invite bids for a long-term chartering service of ships or barges for the purpose.

These moves come a year after India, Myanmar and Bangladesh signed a trilateral pact to collaborate on the MBI project, which is also aimed at helping Bangladesh carry gas from its surplus regions to deficit areas.

The demand for compressed natural gas (CNG) and liquefied natural gas continues to grow in India, with over 300 CNG stations and over 300,000 vehicles running on CNG. The delay in Bangladesh firming up the agreement saw a worried Yangon, which is keen to exploit the financial viability of its new gas finds, acceding to China's demands for gas supplies after persistently urging India to tie up alternative plans, including setting up power projects near the gasfields.

Myanmar is concerned that India will be unable to evacuate gas once the reserves are certified by a third party agency and are made available for commercial production. India's ONGC and GAIL, along with two South Korean companies, Korea Gas and Daewoo, have agreed to jointly develop the block. But there is no agreement on evacuation, with both India and China at an equal distance from the gas blocks.

Though Bangladesh stands to earn substantial transit fees of $125 million per year, it has set conditions that include creation of corridors through India to carry out trade with other neighbors, such as Nepal and Bhutan, as well as steps to reduce its $2.5 billion trade deficit with India. Clearly, New Delhi has made up its mind to bypass Dhaka, even though the cost of the pipeline stands to increase substantially.

For the past year, New Delhi and Yangon have been exploring independent alternatives for importing gas. Bangladesh was not invited to the third meeting on the project. New Delhi has talked of the possibility of constructing the pipeline from Myanmar into Mizoram and onwards to Assam (both in northeast India) and culminating in West Bengal. The shortest pipeline route is from Myanmar to Bengal through Bangladesh, while the alternative land route would be twice the distance.

Thus, given the economic advantages as well as higher feasibility, India opened another window for negotiations with Bangladesh. Former foreign minister Natwar Singh visited Dhaka in August last and said that the tri-nation project would not proceed without the involvement of Bangladesh.

Last month, former petroleum minister Mani Shanker Aiyer visited Beijing. India and China signed a slew of MoUs on energy cooperation, including between ONGC Videsh Ltd, India's flagship firm for overseas oil and gasfield acquisitions, and China National Petroleum Corporation (CNPC). In the first instance of Sino-Indian cooperation, India and China won a joint bid in December last to buy PetroCanada's 37% stake in Syrian oilfields for $573 million.

However, most observers believe that any cooperation in future can only be on a case-by-case basis, with the Myanmar-China deal demonstrating that when it comes to energy security, nations will go it alone if they can.

Siddharth Srivastava is a New Delhi-based journalist.

<b>* :</b> Of Course Pakistan wants India to Join the Pipe Line from Turkmenistan and-or Iran. Pakistan needs only 500 Million Cubic Feet of Natural Gas a day and if it is for such a small amount then such a Pipe Line will not be Economical. Thus Indian Bhailogs will help Pakistan by agreeing to a larger Pipe Line being built for which the Indian’s will pay USD 600 Million Annually in Transit Dues for 2,5-3 Billion Cubic Feet of Natural Gas a Day.

In addition Pakistan can stop the flow of Gas and make India agree to its conditions.

<b>Isn’t it wonderful to see our Burra Sahibs putting India’s Energy Jugular in Pakistani Hands as also India’s Neck under the Pakistani Guillotine?</b>

Meantime : I will try and find Dr. Saleem Farrukh’s Article about the Turkmenistan-Pakistan-India Pipe Line having to go through some of the most Volatile Region in the World.

Cheers <!--emo&:beer--><img src='style_emoticons/<#EMO_DIR#>/cheers.gif' border='0' style='vertical-align:middle' alt='cheers.gif' /><!--endemo-->

[Guest]

Nareshji, Thanks for posting the informative articles. Meanwhile, do you have any information as to what UK is thinking of in respect of its coal reserve. Some years back, in India there was talks about converting coal into gas and sending it via pipeline for distribution. Now nothing is being heard on the subject. Actually, I feel no effort is being made to revamp the old thermal power plants in the country, so that the green house effect and polution could be reduced. Similarly, no new mega project for hydro power has been heard of in recent years.Maybe the oil lobby has silenced everything.