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BR Research

Where is IP gas pipeline heading?

Published September 19, 2011 Updated September 19, 2011 12:00am

gaspipelineOne of Pakistans closest friends or so the governments want the people to believe; the US has reportedly shown its dissent again on the Iran-Pakistan (IP) gas pipeline deal. The much needed IP gas pipeline was in the headlines recently when the two countries made progress on the project, with Iran committing to the earlier promised deadline of 2012, only to learn that Pakistan won be ready before 2014 - if at all. It was only a matter of time before the good old friend, US would intervene to remind Pakistan of its well-documented reservations on the deal threatening Pakistan with dire consequences which would most certainly include economic sanctions. However, if you are one for the official handouts - it made a good reading. "Affirmation from the US side for its commitment to help Pakistan in its endeavours to resolve the energy crises..... We will continue to support Pakistan in its efforts to resolve this energy crisis", read the statement but what reportedly was conveyed off the record is of more significance. "They (US) reiterated their stance on the IP gas pipeline deal stressing Pakistan to find alternative options and expediting the hydrocarbon reserves instead", a source close to the IP deal told BR research on the condition of anonymity. It goes without saying that Pakistan direly needs the IP project which should fetch 750 mmcfd of gas for 25 years from Irans largest gas fields. The fact that Pakistan is still in the infancy stage regarding the deal; dealing with geographic surveys, either indicates the seriousness or the lack of it, in Islamabad or the intensity of pressure that is coming from Washington. As has often been the case, experts expect the IP deal to take a backseat as distractions will soon follow. And it seems that Indias signal of showing intent to rejoin the deal which was once called the IPI deal is part of the ploy. "There is absolutely no way India will actually join the project - it is just another tactic to delay the process and to confuse both Iran and Pakistan," a renowned energy expert told BR Research. It should be recalled that back in June 2010, when Pakistan and Iran were negotiating on the IP deal, the TAPI gas pipeline deal made headlines. "Whenever there is some progress on the IP deal, the TAPI project is brought in focus...the US does not want the IP deal to materialise," a seasoned energy expert close to the IP deal told BR Research adding that it will not be long before TAPI is brought back in the limelight to lure attention away from the real deal. It is about time, Pakistan decided which boat it wants to put its feet in. The IP deal is arguably the best option, but do the policymakers have the guts to stand up and go against the US? If they don , they should better start exploring other avenues and if they do, they should start lobbying for the project financing. One way or another, now is the time to decide.

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