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Pipeline impasse may be resolved soon

March 23, 2007
Source: PTI
India and Pakistan on Friday made 'good' progress in resolving differences over the fee to be paid by New Delhi to Islamabad for allowing flow of natural gas through a pipeline from Iran.

"We made good progress but another round of technical dialogue will be held before we can say we have agreed on all the issues," a government official said at the end of two-day technical talks. The next meeting of the technical group would be held in Islamabad next month.

India and Pakistan have differences over the transportation tariff for the 1036-km pipeline section falling in Pakistan and the transit fee payable to Islamabad.

"We have narrowed down the differences," the official said but did not elaborate. New Delhi had suggested a transportation tariff of $0.50 per million British thermal unit while Pakistan wants $1.57 per mBtu.

Islamabad is seeking a transit fee of 10 per cent of the gas price at India border (price payable to Iran plus transportation cost) while India is willing to pay a maximum of 5 per cent of the gas price at Iran-Pakistan border.

India and Pakistan are more or less in sync with Iran's latest formula, according to which the price of gas at $60 per barrel crude price comes to $4.93 per mBtu.

The official said the formula was also acceptable to New Delhi but it wants issues of transportation tariff and transit fee to be resolved before communicating acceptance to the formula.

"We think we are on schedule for the mid-June tripartite ministerial meet to ink the deal," the official said.
Source: PTI
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