Weak Diplomacy Impedes Gas Export Development

EghtesadOnline: Weak diplomatic relations with India and Pakistan have prevented Iran from becoming a natural gas exporter, an energy expert said.

News ID: ۷۸۳۰۰۶

20 June 2018

According to Ibrahim Allahmoradi, sticking to a passive diplomacy in gas disputes with neighboring states, namely Turkmenistan, Pakistan and Turkey, has had adverse effects on the country's attempts to expand its gas export network, Mehr News Agency reported.

"Had the National Iranian Gas Company been more active in talks with Pakistan to implement the so-called 'Peace' pipeline project that was aimed at supplying gas to India, Turkmenistan could not replace Iran as a supplier," he said.

"Lack of productive relations with the world can jeopardize national interests."

After years of negotiations that included India as a potential investor, Iran and Pakistan signed a bilateral agreement in 2009 to lay a pipeline to deliver 22 million cubic meters per day of gas from the South Pars Gas Field in the Persian Gulf to Pakistan's Balochistan and Sindh provinces, according to Financial Tribune.

The pipeline's construction was to commence in 2012 and be completed in two years. But Pakistan backtracked on the project after international sanctions were introduced against Tehran over its nuclear program.

Allahmoradi added that Islamabad has failed to show determination to complete the pipeline on its territory, even after the termination of sanctions, due to political disputes with India. Nonetheless, when it comes to Turkmenistan-Afghanistan-Pakistan-India —aka TAPI— gas pipeline project, Pakistan avoids disputes with Delhi and agrees to import gas from Ashgabat instead of Tehran.

According to the expert, Pakistan is not eager to cooperate with Iran under the pretext of boundary disputes with India, which is no more than a feeble excuse and the main reason should be sought in Iran's weak diplomatic relations with its potential gas customers, especially India.

In view of India's population of about 1.3 billion, the country is in dire need of gas supplies, because of which it is striving to sign a deal on the development of Farzad-B Gas Field, located in Persian Gulf, and the construction of liquefied natural gas units. NGC Videsh Ltd, the overseas arm of state-owned Oil and Natural Gas Corp, last year offered to spend $11 billion to develop the field, but Iran deferred it.

Allahmoradi also highlight that the IP venture's failure has never had anything to do security issues in India and Pakistan.

Ashgabat has always counted on Delhi as a huge gas market, but because of exporting gas to Iran, it did not have enough supplies to sell to India until 2016 when the Central Asian state unilaterally halted natural gas supplies to Iran over price disagreements.

"The incident turned out to be a blessing in disguise for Ashgabat, as it clinched a deal with India and TAPI gained momentum," he said.