IPI gas pipeline to be built in parts

The over $7 billion Iran-Pakistan-India (IPI) gas pipeline is likely to be built in parts with three nations deciding to construct segments of pipeline falling in their territory independently.
"Iran will build pipeline segment in its territory and Pakistan responsible for construction of section falling in its territory. Indian firms will lay pipeline from Indo-Pak border to their consumption centers," Press Trust of India reported quoting a top petroleum ministry official.
India will enter into agreement with Iran for purchase of gas at its border and responsibility will be fixed on Islamabad for safe passage of pipeline, uninterrupted supplies and delivery of gas at Indian border.
Official said setting up of international consortium, comprising state firms of three countries and global energy majors, for construction and operation of the world's most valuable project could be a non-starter due to political and legal opposition from the US, including threat of invoking sanctions under Iran-Libya Sanctions Act (ILSA).
The project may be executed separately by three states in their own territories to protect it from US sanctions, he said. India will sign a "supply-or-pay" agreement with Iran with a provision on alternative supplies during disruptions. With three countries separately executing it in their territories, it will be protected from US sanctions and even enable American consultants and contractors to participate in portions of project.
Iran will lay 56-inch pipeline up to its border with Pakistan, from where diameter will reduce to about 40-48 inches to carry 60 million standard cubic meters per day of gas that will be split equally between India and Pakistan.
Official said India was likely to suggest a tripartite monitoring mechanism - a technical committee made up of representatives of three national gas companies to oversee technical aspects of project and officials committee to ensure smooth progress in different aspects as well as steering committee at ministerial level that will address political and other issues.
India & Pakistan last month reached agreement on quality of gas to be transported through pipeline in initial phase, but differed on transportation charges and transit fee payable to Islamabad for using its territory.
Technical level talks between two sides will try to reach consensus on route, transportation tariff and transit fee before bilateral meet sometime in April 25. If all goes well, a ministerial tripartite meeting in June may ink pipeline deal.