Bharat Rakshak

TSP is ecstatic with the foolish approach of Mani Shankar Aiyyar and the UPA Government.

TSP and India to discuss gas pipeline



TSP tries to pull wool over our eyes claiming,"concerned about security mainly because of the recent clashes in Balochistan where Pakistan’s own gas fields came under attack by militant groups."

The above is just one aspect of the security issue. The fact that the core problem between India and TSP is the unbridled and deep desire to destroy India by TSP is the real cause for worry for commiting to a gas pipeline that would meet nearly one-third of India's gas requirements in 5 years' time. TSP has time and again proven to be a reckless player willing to even go totally blind just to spite our face. TSP has gone back on promises it made to India and the US on cross-border terrorism. It has no hesitation in discarding international agreements, as demonstrated before. That's why a landline, even with 400% guarantees from TSP, cannot be part of the CBM. The landline can come only when TSP has proved to have changed course irreversibly vis-a-vis India. We should use every means at our disposal to make TSP see reality. The landline can be used as a carrot but there cannot be any implementation of this until India is convinced on the genuine sincerity of TSP. TSP is desperate to get gas fromm Iran and that cannot happen unless India agrees to a landline and that's yet another reason for TSP's interest, apart from the stranglehold it can have on India and the transit fees it can get. There is of course the other aspect of the viability of TSP as a federal structure. If Balochistan and Sindh separate, we will have to renegotiate the landline through these countries.

Our leaders will be really foolish if they do it. But considering the past mistakes thay have done and the soft image projected. Who knows they shall even sign it.

http://www.hindu.com/seta/2004/09/02/st ... 201400.htm
Sunflower oil to power future cars

We have seen many people jump into this landline bandwagon, the likes of V.S.Arunachalam, Air Cmdr. Jasjit Singh, R.K.Pachauri of TERI, Naqvi et al. It is now the turn of C.Raja Mohan to espouse the cause of the Peace Pipeline.



That's true. In early circa 2000, Gen. Musharraf clearly mentioned how TSP can leverage such a situation. What we have to realize is the true import of such a statement. TSP's sole ambition is not to improve the lot of the hapless millions in their land of the pure, but to destroy India, come hell or high water. We have seen no change in that policy, only it may be getting more refined now. To that end, the pipeline will be a tremendous tool, notwithstanding Raja Mohan's ways to address both questions of security and reliability through a variety of legal and financial instruments. OTOH, TSP's reluctance for reverse flow of energy in the form of a diesel pipeline from India to TSP probably betrays her real intentions. At the cost of sounding repetitive, the stranglehold such a pipeline puts in the hands of TSP, the USD 600-800 million per annum of transit fees, the assured gas supply for Pakistan itself which will otherwise be unviable without India's participation make the landline a fantastic proposition for TSP.

Four course menu for Aiyyar-Kasuri meet



This is a specious argument because, TSP can go to spot market and get diesel or other petrogoods without much of a problem while it will not be the case for India with respect to gas. It also has friends in the form of UAE and Saudi who, in a swell of the Ummah bosom, would help TSP tide over the situation. Even then, TSP is reluctant to import diesel from India. Transporting gas is a different ball game altogether and the deficit cannot be overcome short of building cryogenic ships, gassification/degassification plants, port facilities etc all of which are considerable time-consuming huge capex. Why should India enter into such a Faustian bargain ?

One can think of it as an opportunity to extend the Gujral doctrine to Pakistan. If it is successful, smaller neighbors would follow. The benefits are enormous, but of course so are the risks.

Regards,
Sandeep.

An interesting take from the following article:-
http://www.american.edu/TED/iranpipeline.htm

skmody, the so-called Gujral doctrine is humbug, IMO. In any case, it cannot be practised with TSP whose sole aim is to destroy India. The Gujral doctrine will only help TSP hasten this process. We cannot and should not put ourselves in a situation where we are dependent on an implacable TSP for our survival, either economic or otherwise PERIOD. It is a sophisticated approach if we use every weapon in our armoury, including the pipeline project, to instill some sense in the TSP mindset. However, I worry if our approach to realpolitik foreign policy, would measure up to that. Also, events have proved that a united, economically strong TSP is NOT in INDIA's INTEREST.


As for your reference to the other article, I have seen it a couple of years before. It is dated as it was written in 2000. It has a lot of anti-India stuff and homilies for India. It is strange you should refer to this article. The article does not talk about Indian security concerns, for example. I think she is a Bangladeshi who talks about all other gas exports except from BD. If she is so worried about the "hegemonic designs of India", she should have suggested gas exports from BD in order to reduce the deplorable trade imbalance. They cannot hope to reduce the deficit by exporting Hilsa fish and the like. Not only BD does not want to export gas, but it also does not allow a pipeline from Myanmar to India through its territory. So much for the "economic cooperation" theory. In any case, her argument, "Furthermore, potential economic collaboration and gain will also lead to a possible transformation of social and political discourse between the countries, perhaps even leading to mediation and resolution of regional conflicts....The pipeline posits trade as a mediator in the development of India, Iran, and Pakistan's bilateral policies and conflict resolution ", is exactly what India has been saying and TSP has been refusing ro accept. But, that cannot start with a big ticket project like the gas pipeline which would eventually control a sizeable chunk of economic activity in India while TSP continues to maintain a negative import list for Indian goods and services.

If as Zehra says, "Thus, the Pakistani government views the pipeline project as regional collaboration with Iran and not India.", , where is the question of economic coperation between TSP and India that Shamila predicates will lead to conflict resolution ? The unremitting hostility of TSP to India is revealed when Shamila says. "This shift shows Pakistan's economic and political alignment with Central Asia and the Mideast more so than with South Asia" because we know from various utterences of TSP leaders and the so-called intelligentsia it is not only political and economic mis-alignments that TSP is seeking but also ethnic and racial ones.

There are some inaccuracies in the report anyways like when she says, "the Pakistani government would be able to “inject its own exportable gas for sale to the international market that is [Delhi] India” . TSP has gas deficit and desperately needs import from Turkmenistan or Iran.

Cairn Energy independently confirms Mangla reserves

Cairn expects to produce 5 MTPA from Mangla and other Rajasthan fields

Looks like with Ambani, SP, Mani with the outside support of the Rockefeller this venture is getting all the media support. It looks like a psy ops on the paki leadership and the public to open up its industry so that TSP can survive as a country in future.


If TSP does not open its trade in the next few years it may have serious financial problem and implosion. With 5M new Pakis every year there could be disaster in the region. The trade from the Central asia and the middle east region is costly for the TSP economy and hence for the people increasing the poverty level.

Railing against the pipeline just because 'it goes through Pakistan' is a counterproductive exercise. There are way too many who are either sufficiently naive or ignorant, or choose to have their heads buried firmly in the sand when any link between Pakistan and terror is revealed. The problem I see is that we'll be seen as the 'villains' who are 'against peace' or some such gobbledegook. Unforunately there are too many people who'll fall for that line of argument.

Instead I propose we conceive a counterproposal that is grounded in an equal, if not even more compelling sounding snake oil blitz, taking a leaf out of Arindam's superb Neelam Plan that pricked the bubble of the half-assed "Chenab Plan" that the Pakis came up with.

Two possibilties would be the following:
a) Propose an extension of the pipeline to energy-starved China. Sure the Chinese will never accept it, but that's just the point. Keep the suggestion entirely between India and Pakistan and as a means of grandstanding on the magnanimity issue. Encourage Pakistan into roping in China based on their 'all-weather' friendship.
b) Propose an extension of the 'pipeline diplomacy' to road diplomacy - a fork from India joining the Karakoram Highway. A fantastic idea that would herald a revival of that great trade route that funneled Asia's riches to the barbarians in Europe. A route between two great friends that can become a route that connects two growing powers and bring together two estranged 'South Asian' nations. Oh the beauty of it.

Now my cheek hurting from my tongue sticking against it. But seriously, I would strongly argue about getting such a counterargument into popular press, just like Arindam did with the Neelam Plan, in order to sow debate and dissent that will destroy the whole idea in due course. Jingoism doesn't always work against snake oil; sometimes you need your own brand of snake oil.

Actually, the alternative is not a gas pipeline, but a gas-to-liquids plant in Iran with the liquids shipped to India.

http://www.rediff.com/news/2003/jan/22ram.htm

If I understand this correctly the amount of gas to be transported is 2.5 Million Tons/year. If my math is correct, this is equivalent to 450MMSCFD (million standard cubic feet per day). At current prices, 1MMSCFD is worth ~$5000, so the amount of energy has a current value of approximately $850 Million. Since the Iranians are offering this at 1/2 price, this would cost us approximately $450MM.

The capital cost, if I understand correctly is around $1 billion, with an annual transit fee to Pakistan of around $500 million. Adding the transit cost, the cost to us would be comparable to the international prices.

Compare this with a GTL plant built with Sasol's technology.
http://www.chemlink.com.au/gtl.htm



In other words, for 450MMSCFD, the capital cost would be around $1 billion. The plant would produce approximately 45,000 bpd of liquids. The cost of converting the gas to liquid is around $5/barrel, plus the cost of gas and transportation. At these sizes, I'd say that we can make a very good case for a wholly owned Indian GTL plant in Iran with Indian ships running back and forth.

This would have the additional advantage of helping India develop and implement the technology that will be crucial for world energy markets in the coming years.

This can be a compelling BRM article. First of all, I need confirmation of the annual quantity, and investment cost of the proposed pipeline through Pakistan.

Calvin, what you say is perfectly fine. My earlier post had absolutely nothing to do with proposing viable alternatives - it was all about proposing goody-goody *viable sounding* additional ideas that will never see the light of day, and which when repeatedly tied to the equally ridiculous pipeline plan, will ensure the pipeline sinks with the weight these additional ideas. Basically about leveraging additional faultlines between us, the Chinese and Pakis to overload the idea enough to ruin it.

- 1MTPA LNG = 48.7 Billion SCF gas
(http://www.indialpg.com/html/conversion.htm)
hence: 2.5 MTPA LNG ~ 335 MMSCF/day ~ 10 MMSCM/day

- Current regasified LNG costs from Petronet at Dahej are around $3.8 / MMBTU rising upto $4.5 /MMBTU along the HBJ pipeline. Iran has promised to significantly undercut these prices.

- The interesting comparison to make would be between the following:
LNG liquefaction/transportation/regasification costs
GTL/liquefaction/transportation
Overland pipeline with Pakistani "transit" fees

- If a pipeline is built I think it will carry a lot more than 10 MMSCM/day. More like say 20-30 MMSCM/day

Guha: Thanks, I see that I mistakenly used a molecular weight of 12, instead of 16 in my calculations that led to the error. Thanks again.

Now, do you have any additional collated information on the capital and operating cost of the fuel transfer to India?

I agree with Suraj's proposal. Politically we should not look negative to the world and leftist media. In principle we should be ready to accept the proposal and start couple of studies and commissions for the purpose. Add some more suggestions and increase the scope of project to include a reverse petro product line to pakistan from India, transit rights to indian goods to Iran/Afghanistan, most favored nation status to India. A 15-day gas reserve in India built into project cost, international sovereign guarantees by pakistan to investors, a 100% export oriented power plant in pakistan owned by pak for exporting electricity to Kashmir etc. We can build enough CBM in the proposal that Pak would feel equal heat on accepting the proposal and if they still do accept it, it'll be a good deal for us anyway.

Once we have enough LNG import plants, domestic fields coming online, pipeline from Burma approved and domestic safety LNG/Gas reserves built we'll either not need this pipeline or our risks would be diversified.

Saying straight no is politically not a good solution IMHO.

- on LNG costs we can probaly make a good estimate from Petronets costs at Dahej.
- a day in the library will probably yield a lot of info on pipeline construction transportation costs.
- I dont know much about GTL, Calvin you are probably the expert there, are there a few competing technologies to consider or a clear winner?
(I think Chevron is building a big GTL plant in Nigeria we can probably use somne figures from there)

Even if the project works, the profit from the pipeline will go towards pakistani military, same place as half of Pakistans disposable funds go. India will have to sepend money to counter that.

Pakistan may get upto 1 billion dollars form the pipleine. that is almost 25% of the entire Pak defence budget. Trade is good, when the profit lands in Pakistani public hands, not when it lands in Pak gov hand.

You might find this presentation by BHPBilliton,who were commissioned by NIOC to do a feasibility study, useful.

Costs estimated at USD 4.16 Bn and gas throughput at 1.5 to 3 BCFD (on page 4).

Aiyar's oil diplomacy to shape new projects

Although your fears are justified but I am against the philosophy that if I can hurt you for $1, I'll am willing to take a hit of $20. We are 70% dependent on import for energy and our domestic production is declining. We need large and cheap source of energy that can power our economic take off. Indian electricity consumer according to "India-Today" pays highest cost (11c) per unit for electricity, imported LNG won’t be cheap enough for most of the consumers to afford IMHO. Piped gas on the other hand will change the scenario of power sector in India.

$1 bill will not make Pak a Saudi Arabia or Russia but a large pipeline can make us a new China.

What if the choice is against a hit of "$1.20" rather than $20?

Than it's a bad deal

Even according to this BHP-Billiton presentation (likely to paint a rosier picture for India) the financial gains for India and Pakistan are comparable. So if India is gaining substantially more it has to be in some other way.

Regards,
Sandeep.

From:

http://www.dailytimes.com.pk/default.asp?page=story_19-9-2004_pg5_22

India says close to signing oil, LNG deal with Iran

Aiyar and his Iranian counterpart, Bijan Zanganeh, held talks in Vienna, where he is attending an OPEC seminar, and “virtually finalised” the agreement, which they had been negotiating for the last 18 months, Aiyar said in a statement issued in New Delhi.

“The conclusions range across Indian participation in three Iranian oilfields and joint exploration of gas fields, long-term purchases of LNG, revamping of refineries at Tehran and Tabriz, tankage, engineering and design,” the statement said. Other areas of cooperation included investments in petrochemical projects in both countries, he said.

Aiyar told reporters in New Delhi in a teleconference from Vienna he had not held detailed discussions on another proposal to build a natural gas pipeline from Iran to India via Pakistan.

“The pipeline is not on the back-burner but it has taken the second order of priority,” he said.

Good find about the negotiations at OPEC. Have there been any other discussions of the transport of LNG to India from IRan, other than through Pakistan? IOW, is Iran building an LNG terminal, from which LNG can be shipped?

LNG transportation between Iran and India is and has always been completely independent of Pakistan and they are entirely superfluous in the matter.

As for plain vanilla natural gas (NG) being transported between India and Iran outside Pakistani territory, there seems to be one feasibility study out there (still ongoing ?) by Snamprogetti/Saipem/DNV.



Iran appears to be on the road to building a natural gas liquefaction plant of 8 MTPA capacity in a joint venture, Pars LNG, with Total (France) and Petronas (Malaysia). A shareholders agreement was executed to enable this and was signed in Feb. 2004. Where exactly India figures in this plan, I do not know. As conceived by Iran, Pars LNG was to cater to Asia (minus India) while Iran LNG was to cater to India’s needs (URL).There was some talk of Reliance’s involvement in the Iran LNG project, but it appears to have gone cold now (URL).

However talks with Iran for importing 5 MTPA of LNG have being ongoing and the last bit on the matter that I am aware off is that there was a holdup given India’s insistence that OVL be given a share in the Husseinieh-Khush oil field on a nomination rather than bid basis. This dates to June 28, 2004.

Interestingly there seems to be no confirmation so far that an agreement was actually signed as expected on Friday by India and Iran on the sidelines of the OPEC meet. Mani Shankar Aiyar’s comments datelined Sunday still shows it being on the to do list.

Very good post Arun! Good collection of lot of infirmative links. Thanks

My pleasure, for your appreciative words, Raj.

[url=http://sify.com/finance/fullstory.php?id=13571515&headline=Iran~offers~India~20%~stake~in~oilfield]Iran offers India 20% stake in oilfield[/url]

Technically this deal can't be qualified as "stake sale" because ONGC will have to buy this crude on market price and it'll earn a fixed rate of return (more like interest rate) on it's investment. The crude oil deal could best be described as long term purchasing agreement at prevailing market price. Iran will manage entire risk and pocket the profit. Still better than nothing

Iran has obscene amount of natural gas that we must secure before someone else gets their hands on it. Long-term large quantity LNG purchase deals should be inked as soon as possible. Couple of pipelines would also be nice if they can be built over land and/or underwater.

What are the possibilities of connecting Iran and India by railway? This could definitely help in importing crude oil and would be much safer than pipeline. Returning trains can take Indian goods back for Iran, Afghanistan, CAR and Pakistan while Pak can earn transit fees both ways. If this arrangement works out fine later we can think about a pipeline. Assuming that sufficient railway infrastructure already exists and only a small portion from Pak to Iran may need to be build?

http://timesofindia.indiatimes.com/arti ... 861312.cms

OVL's project in Russia suffers cost overrun

THURSDAY, SEPTEMBER 23, 2004 07:37:20 PM

NEW DELHI: ONGC Videsh Ltd, the overseas investment arm of Oil and Natural Gas Corp (ONGC), on Thursday said that its $1.77 billion Sakhalin-I oil and gas project in Russia had suffered a cost overrun, but the project remained "viable and attractive."

"ExxonMobil (the operator) has informed us that there is an increase in cost mainly because of reworked development plan (to put the field to production)," OVL chairman Subir Raha told reporters here.

Raha said that the reworked development plan would cut the expenditure in the Phase-II development cost. Besides, early production of natural gas from the fields had also contributed to the increased cost.

Earlier, the ExxonMobil-led consortium had planned to produce crude oil from the project by 2005 and natural gas by 2007. But now natural gas production is also targetted by 2006.

"Reserve estimates of Sakhalin-I fields have been revised upwards... the project continues to be viable and economically attractive," he said, adding the payback period of OVL's investment might remain the same as previously estimated as crude oil prices had almost doubled since the time the estimates were made.

Though Raha did not give the cost overrun, government sources indicated that the increased cost could be between $550 million and $850 million.

OVL's revised investment in the project has been pegged in the $2.32 billion to $2.62 billion range. So far, OVL has invested $1.3 billion in the project.

Not likely in the foreseeable future, IMHO, because of the country that lies on the land route between India and Iran.

That country did not allow humanitarian shipments of wheat from India for the people of Afghanistan to pass through its territory, on one pretext or the other. Given their attitude, I doubt if any road or rail links will happen anytime soon.

Gas fuels warmth in Indo-Pak relations



One should ask the question why so ? Why should Pakistan, who has an implacable enmity with India and not willing to give us the MFN status et al, be so forthcoming on the pipeline issue ?

One hopes this is just the smart way of saying NO without coming across as belligerent. After all, even with YES, just to get started will take 3 years or more. Add another 10 years to build pipeline and connect to end users at subcontinent speed not forgetting it passes through Afghanistan. In the meantime, if TSP misbehaves there is enough time to say NO. A million things can go wrong at their end and we can wash our hands off the whole thing with glee yet coming across as mature and responsible.

Suppiah, I hold a slightly different view. Firstly, I have come to the conclusion that TSP does NOT understand anything other than belligerence. Period. We don't have to keep proving our reasonableness to the Foggy Bottoms or the Aunties or other distant relatives in this world time and again. These countries are not there to appreciate our maturity and reasonableness. They are there to further their own interests. In any case, if they have not yet understood India's foreign policy and its restraint so far, one more instance, and that too a commercial activity, is not going to convince them.

Secondly, our NG requirements are growing. We need to finalize plans and cannot afford to keep procrastinating for years.