Re: Iran cancels Pakistan gas pipeline loan
I do not know how long uneducated Pakistanis would become fool by journalists, politicians and vested interests just because they are ignorant. Unfortunately, I can see that sometime even those who can be classified as educated get misguided easily. For instance, above article is written by Indian journalist, whose obvious target are Pakistani readers, and article is classical example of making fool of the readers (especially Pakistanis). What can one say, as for most Pakistanis, it is very difficult to even read few lines, leave doing research or read lengthy articles.
[Note: While India is going ahead with under-sea gas pipeline from Iran to India, that would cost around $5 billion, the writer is portraying Pakistan import of gas as bad deal … though I agree that Pakistan should try to get price reduced, but even at present price, I do not think it is bad deal … and I am going to give reason for that too].
Anyhow, to fool the readers, writer did not even give any comparative price of electricity Pakistan is getting using crude oil. For instance, read pricing part of article and think:
From above, according to Gulfraz Ahmed (Pakistan petroleum secretary)… Gas deal implies … price in Brent oil per barrel corresponding to price per MBTU of gas:
$60 a barrel = $8 per MBTU (as mmbtu = MBTU)
$100 a barrel = $13 per MBTU … corresponding to electricity price of Rs7.50 per unit (KWh)
$150 a barrel = $20 per MBTU … corresponding to electricity price of Rs11.00 per unit (KWh)
Now, if Pakistan is producing electricity using petroleum then it is obvious that price of electricity would rise as petroleum price would rise, so what is big deal? If oil price would double then electricity unit cost produced by oil would double too.
Big deal is the cost of producing electricity using petroleum import or gas import. Presently Pakistan is using petroleum import for a major part of electricity production.
Read the article below (Pak newspaper: The Nation):
Energy crisis: who is responsible?
**From above articles, if crude oil price would be $100 a barrel: **
**It would cost Pakistan Rs 7.50 per unit of electricity using Iranian gas import.
It would cost Rs 18 to Rs 24 per unit of electricity if crude oil is used **
And worse is that, Pakistan have to import either crude oil or gas for producing electricity … until Pakistan complete constructing large hydro-power projects … or get electricity using nuclear means.
So, if crude oil price is $100 per barrel, Pakistan would save ‘Rs 10 to Rs 16’ per unit of electricity using Iranian gas … and saving would be higher if crude oil price would increase beyond $100 per barrel.
So … what Pakistan should do? … Think carefully.
[Note: Actually, India is trying to buy gas from Iran much before Iran-Pakistan-India pipeline program. India always preferred deep-sea pipe independent of Pakistan, but Iran did not. They wanted pipe to go through Pakistan as it was cheaper and probably they thought that using same route they might extend their export to China too. Meanwhile it was good for Pakistan, as Pakistan could have taken transit fee for gas going to India (and later to China).
But Pakistanis being idiots, kept lingering the issue under the pressure of USA and KSA, so if Iran-India pipeline become reality, Pakistan would lose on transit fee and some leverage over India and possibility of transit fee for gas if it get exported to China.]
Here is news about India working with Iran to import gas using underwater pipeline. So … question is … is it OK for India to get gas from Iran and Pakistan do not … when due to energy shortage Pakistan industry is crumbling and people suffering?
Farsnews
Fri Dec 13, 2013 4:16
**
Deepwater Pipeline May Deliver Iran’s Natural Gas to India**
TEHRAN (FNA)- Marketing Manager of the National Iranian Gas Exports Company (NIGEC) Ali amirani said that the NIGEC has generally agreed to deliver Iran’s natural gas to India through a deepwater pipeline crossing the Sea of Oman.
“Negotiations were held with three Indian companies for (their) purchase of gas from Iran, and general agreements have been reached,” Amirani said.
He added that Iran and India are expected to start talks about gas sales and pricing after the finalization of the agreements in a months’ time.
Amirani stated that India’s South Asia Gas Enterprise Pvt. Ltd. (SAGE) has conducted feasibility studies for the planned 1,400-kilometer pipeline, which is estimated to cost $4-5bln and would carry 31 million cubic meters (mcm) per day of gas to India.
The envisaged pipeline will pump gas from Iran’s gigantic South Pars gas field.
Pars Special Economic Energy Zone (PSEEZ) was established in 1988 for the utilization of South Pars oil and gas resources and encouraging commercial activities in the field of oil, gas and petrochemical industries.
South Pars gas field is a natural gas condensate field located in the Persian Gulf. It is the world’s largest gas field, shared between Iran and Qatar. According to the International Energy Agency (IEA), the field holds an estimated 1,800 trillion cubic feet (51 trillion cubic meters) of in-situ natural gas and some 50 billion barrels (7.9 billion cubic meters) of natural gas condensate.
Iran and India which have deep historical and cultural relations are now seeking to further expand political and economic ties.
India, the world’s fourth-largest petroleum consumer, is Iran’s second largest oil customer after China and purchases around $12bln worth of Iranian crude every year, about 12 percent of its consumption.
India and Iran have been holding discussions at regular intervals on issues related to economic cooperation under the joint commission mechanism, which was established in July 1983.