India in Talks to Build $4.5B Subsea Pipeline to Transport Gas from Iran

India and Iran are holding discussions to construct a $4.5 billion subsea pipeline to transport natural gas from the OPEC member to the South Asian country, according to a senior official of the National Iranian Gas Export Company (NIGEC), as quoted in a report carried by India's daily Economic Times (ET) Tuesday.

The proposed subsea pipeline, linking the Iranian coast via the Oman Sea and Indian Ocean to Gujarat on the west coast of India, indicated that a long-standing plan to build a natural gas pipeline between the Iran and India through Pakistan has been shelved due to lukewarm interest from New Delhi, NIGEC's Managing Director Alireza Kameli said.

"We are negotiating with our counterpart SAGE company on behalf of Indian gas consumers to discuss about laying the sea pipeline from Iran to India," Kameli stated.

South Asia Gas Enterprise (SAGE) -- a New-Delhi-based firm leading a private consortium to garner support for an subsea pipeline between the two countries -- is pinning its hopes on the lifting of sanctions imposed by the Western nations on Iran to help expedite the project.

"These are all geopolitically sensitive projects, but now the time has come because Iran sanctions are going away," SAGE's Director Subodh Kumar Jain said.

But SAGE will not be involved in gas purchases from Iran and Indian companies buying Iranian gas will have to pay for the use of the pipeline.

"SAGE will not be buying gas from Iran. It will lead an international consortium for building the pipeline," Jain said, as cited in ET Monday, adding that the firm "will next year conduct a FEED (front end engineering and design) study and tie-up financing." The Indian company has appointed SBI Cap as its financial adviser for the project.

The proposed India-Iran subsea pipeline, measuring 870 miles (1,400 kilometers) long, will have a capacity to transport 1.1 billion cubic feet (31.5 million cubic meters) of gas per day, NIGEC's Kameli revealed, as reported by Iran's international news network Press TV Monday.

Kamelie added that the proposed offshore pipeline can be constructed within two years following the necessary approvals and after a gas sale and purchase agreement is signed. 

India has not participated in talks on the 644 mile (1,036 kilometer) Iran-Pakistan-India natural gas pipeline since 2007 on grounds of security and commercial concerns.


Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Company: National Iranian Gas Export Company (NIGEC) more info
 - India in Talks to Build $4.5B Subsea Pipeline to Transport Gas from Iran (Dec 08)
Company: South Asia Gas Enterprise (SAGE) more info
 - India in Talks to Build $4.5B Subsea Pipeline to Transport Gas from Iran (Dec 08)