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India rethinks participation in IPI pipeline project

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    PetroMin has now called for a review citing the stand-off with Iran on pipeline security and gas pricing.

    While highlighting these bottlenecks to the concerned ministries and organisations, the ministry has submitted that “the production from KG D6, along with increased availability of re-gasified LNG, would be able to cater to the existing shortfall of natural gas across all sectors”.

    But in projecting for the future, it says “there is no ceiling on the demand for natural gas” and there was “substantial scope for increase in demand for this clean and inexpensive source of energy” as gas pipeline infrastructure develops in the country.

    The ministry has also suggested that the price of IPI gas be compared with sources other than indigenous gas for deciding India’s participation. “As IPI supplies might begin only then (December 2013), its price needs to be compared to the prices of these (LNG from Gorgon Australia and RasGas Qatar) sources of gas,” it says.

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    Ministry officials said petroleum minister Murli Deora, in response to a letter from his Iranian counterpart, wrote on June 12 seeking an “early meeting” of the India-Iran Working Group on Oil and Gas to resolve the differences.

    Discussions had fallen flat in 1993, but the project was revived in November 2004 by then petroleum minister Mani Shankar Aiyar at a meeting with then Pakistan prime minister Shukat Aziz.

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