IPI gas pricing issue still under discussion: spokesman

The issue of price of Iranian gas for the Iran-Pakistan-India pipeline project was still under discussion between the three countries and negotiations were far from being exhausted, a spokesman of the Ministry of Petroleum and Natural Resources said on Thursday.
In a statement the spokesman expressed surprise at the reported remarks by Iranian Deputy Minister of Oil Dr Nejad Husseinian on the price of Iranian gas for the IPI project.
The spokesman said that Pakistan had all along taken the position that the price of gas should be such that the project remains financially viable and negotiations are set to resume at the next trilateral meeting scheduled at the end of July in New Delhi.
Referring to the Iranian ministers observation that if the governments in Islamabad and New Delhi intended to subsidise their domestic gas there was no reason for Iran to pay this subsidy, the spokesman said the fact is that producers of gas in Pakistan, which include multinationals, do not enjoy subsidy from the government.
The spokesman said the producers, including the multinationals, get the contracted price in accordance with the terms and conditions of the concession agreements.
The subsidy by the government is for domestic sector consumers and fertiliser companies that has no impact on the price of gas for the producers, the spokesman said, adding that this position was explained to the Iranian side during the negotiations.
Regarding the Iranian minister's remark that the pipeline was not an 'absolute obligation' the spokesman said that the IPI project is essentially a commercial deal that must be acceptable not only to the seller but to the buyers as well.
"We, however, attach great deal of importance to this project which is part of our overall energy strategy that includes import of gas from Turkmenistan, import of LNG, development of coal resources and other non-fossil fuel options," the spokesman said.
Pakistan is also focusing on enhancing indigenous production of oil and gas. "For providing additional incentives to the E&P companies, the petroleum policy is being reviewed by the government. The government attaches highest priority to ensuring that our needs for our fast expanding economy are fully met," the spokesman said.