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India again talking about undersea pipe for Iran gas.

With a project to pump gas overland from Iran to India discarded, a 1,300-kilometer undersea pipeline is finding new proponents in India from people who say Iran's natural gas can reach India for less than the price of LNG on the spot market.

The Associated Chambers of Commerce of India (Assocham India) has released the results of its study on "a transnational deep water gas pipeline from Iran, passing through Oman but by-passing Pakistan."

The project could provide feedstock for the country's power, fertilizer and steel plants in an environmentally friendly and affordable way and for sustainable supply of the fuel, the study said.

"An undersea pipeline between Iran-Oman-India will connect the producers and consumers of gas directly. This will bypass all geopolitical issues. It will also lead to more gas-to-gas competition and creating a genuine gas hub, as in Europe/USA etc," the study said.

Iran signed an undersea agreement in 2013 to supply gas to Oman in a deal valued at $60 billion over 25 years. In February of this year, the two countries said they had agreed to change the pipeline's route to avoid waters controlled by the United Arab Emirates.

The planned pipeline would connect Iran's vast gas reserves with Omani consumers as well as with liquefied natural gas (LNG) plants in Oman that could re-ex port the gas.

India's former oil secretary T.N.R. Rao, who released the study last Tuesday, said the Iranian pipeline to Oman could be extended to India.

Rao said natural gas imported through the line would cost from $5 to $5.50 per million British thermal unit at the Indian coast compared with LNG imported through ships at a cost of about $7.50 per mmBtu.

"The cost of landed gas through an undersea pipeline will be at least $2 cheaper than importing LNG, saving about $1 billion annually," the study said.

South Asia Gas Enterprise Pvt Ltd (SAGE), which is chaired by Rao, has volunteered to lay the pipeline, which would bypass the exclusive economic zone of Pakistan. It wants the government to support the pipeline.

The pipeline, estimated to cost over $4 billion, is planned to carry 31.5 million standard cubic meters of gas per day and would be built in two years.

India is now the world's fourth largest natural gas importer, mainly getting it from Qatar.

The undersea pipeline is being promoted as an alternative to the overland Iran-Pakistan-India pipeline, dubbed the "Peace Pipeline." India dropped out of that plan in 2009, with Indian officials saying Iran insisted that India pay for the gas when it reached the Iran-Pakistan border. Indians scoffed at that because it would allow Pakistan to take gas and make India pay for it.

Caption: PIPELINE--The proposed pipeline would go from Chabahar in Iran to Gujarat in India, reaching far out to sea in order to avoid Pakistani waters. The small lines in the ocean show each country's economic zone.

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Title Annotation:Money and its impact: Economy
Publication:Iran Times International (Washington, DC)
Geographic Code:9PAKI
Date:Sep 15, 2017
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