08-29-2006, 02:21 PM
[center]<b><span style='font-size:14pt;line-height:100%'>Doubts about China using Gwadar for energy import</span></b> <!--emo&:flush--><img src='style_emoticons/<#EMO_DIR#>/Flush.gif' border='0' style='vertical-align:middle' alt='Flush.gif' /><!--endemo--> [/center]
<b><i>* Former foreign secretary Riaz Khokhar says govt needs to analyse Chinese plan for energy import through Gwadar Port, as Beijing is negotiating five oil and gas pipelines with CARs</i> <!--emo&:flush--><img src='style_emoticons/<#EMO_DIR#>/Flush.gif' border='0' style='vertical-align:middle' alt='Flush.gif' /><!--endemo-->
ISLAMABAD : Former foreign secretary Riaz Khokhar has said the government needs to analyze the Chinese plan for energy import in future <span style='font-size:14pt;line-height:100%'>as Beijing is negotiating around five oil and gas pipelines with Central Asian Republics.</span></b> <!--emo&:flush--><img src='style_emoticons/<#EMO_DIR#>/Flush.gif' border='0' style='vertical-align:middle' alt='Flush.gif' /><!--endemo-->
There must be a careful study to examine whether China would require Gwadar Port facilities for future oil and gas import, he added.
He said this while taking part in a discussion on a research paper presented by Gulfaraz Ahmed, Executive Director of the International Institute for Peace and Conflict Resolution (IIPCR), an institute of National University of Science and Technology (NUST). The roundtable discussion, was jointly organized the IIPCR and the Pakistan Engineering Council (PEC), on Monday.
In his paper, Mr Gulfaraz said Gwadar Port is one of the suitable options for east-bound oil trade for South Asian, Southeast Asian and Asia Pacific markets as it would be impracticable from 2020 onwards to ship increasing quantity of oil through the present route of the Strait of Hormuz.
Besides Gwardar Port, the new Iranian deep-sea port at Chabahar and some ports on the coast of Oman are other likely choices for oil trade as the present choke point of oil trade at Hormuz is becoming congested and it could affect global energy security as well as regional peace.
He said around 60 million barrels per day oil is imported, which represents the scale of global oil trade. At present oil is available and maritime routes are able to handle the required shipping flows. The availability of oil is, however, shrinking due to declining reserves and a number of oil-surplus countries such as China, Malaysia and Indonesia. They would become net importers of oil in coming years. Around 57 percent of global oil reserves are concentrated primarily in a few countries of the Gulf, which are likely to outlast many other sources of the world oil supply. It is generally visualized that the global reliance on the oil reserves of the Gulf countries will continue to increase in the foreseeable future.
<b>The Oman option would be suitable for south-bound oil meant for European and US markets. <span style='font-size:14pt;line-height:100%'>The Iranian Chabahar Port is suitably located for south and east bound oil movement, he said.</span></b>
The Gulf countries are expected to export around 22 million barrels of oil daily in 2006. Nearly 90 percent of the exports, 20 million barrels daily, would be transported through the narrow Strait of Hormuz, which constitutes a big choke point for the global oil trade. The oil trade from the same sources, in a little over a decade, could be around 34 million barrels per day. The projected increase of 14 million barrels of daily oil flows in just about 13 years through the already congested choke point could affect the smooth flow of oil affecting the reliability of oil supplies and increasing the freight and shipping costs.
By 2020, the world demand for oil is estimated to cross 110 million barrels daily. The export of Gulf oil is expected to rise to about 34 million barrels, of which around 32 million barrels would have to pass through the Strait of Hormuz on daily basis.
This is close to twice the quantity of oil passing through the Strait of Hormuz at present. The increase in the eastbound oil in 2020 is expected to go up to 10 million barrels daily, of which the export to China alone is likely to go up by over five million barrels daily, Mr Gulfaraz said in his paper.
The Gwadar Port can handle very large crude containers of up to 0.5 million tons dead weight, which form crucial part of the international oil movement. For every one million barrels daily outlet capacity at Gwardar, Pakistan could possibly net over a third of a billion dollars a year in revenues besides other indirect economic benefits, including employment opportunities. This will generate substantial resources to boost Pakistan's efforts to develop the vast and backward province of Balochistan, according to the paper.
Some of the participants, who are retired officials from the civilian and military bureaucracy, however, expressed doubts over the thesis made in the paper. Since other choices are available through Iran and Oman ports, the Pakistan government must be required to declare Gwadar Port an open port with open policy. There must be speedy cargo handling in place at the new port. There must be an environment, which is entirely improved from the outdated facilities being provided at Karachi Port.
Some of the participants, including Lt-General Talat Masood (retd), said much importance should be given to the commercial importance of Gwadar. If we continue to stress on strategic position of Gwadar, then the proposed port will lose its commercial and economic benefits. There must not be a surrender of strategic place to anyone, he said without much explaining.
The roundtable conference was attended by Deputy Chairman of the Planning Commission Engineer Dr Akram Sheikh, Adviser to the Prime Minister on Energy Mukhtar Ahmad and other senior serving and retired government officials. fida hussain
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