The third meeting of the tripartite secretary-level working group on the IPI gas pipeline project would be held on August 3 to 4 in New Delhi to discuss price of the gas. Official sources in the Ministry of Petroleum and Natural Resources confirmed on Tuesday to Business Recorder the participation of Pakistani delegation in the scheduled meeting on multi-billion dollars project.
The main issues to be discussed include gas pricing and project structure, they added. "Definitely, the meeting would deliberate on a new mechanism to bring gas price to agreeable level for all three parties. It is difficult issue, which may not be resolved in a couple of meetings", sources said.
The last meeting of oil secretaries of the three countries held in Islamabad on May 22-23 broke off after Iran linked gas to crude oil prices in the international market.
Iran had forwarded a formula wherein the gas price is linked to Brent crude oil with a fixed escalating cost component (10 percent of Brent crude oil). Iran is seeking $7.2 per million British thermal unit (mBtu), with a three percent annual increase. Both India and Pakistan have offered much below the price forwarded by Tehran. Apart from the Brent linkage, the Iranian formula does not prescribe a ceiling for the gas price, they said.
Iran has refused to sell the gas at the subsidised rate, but the officials said that it would be an agreement between seller and buyers and they (buyer) want a price, which their consumer can afford.
The talks would be followed by a meeting of energy ministers of the three countries in Tehran to finalise modalities for implementation of the project, if three parties agree on gas pricing formula.
India wants to import 90 million standard cubic meters of gas per day from Iran through the 2,100-km-long pipeline while Pakistan has indicated a requirement of up to 60 mmscmd.