Iran planning gas pipeline to Gujarat

Iran is in talks with India to export natural gas to the country’s Gujarat province through a $4.5-billion subsea pipeline. The proposed 1,400-km route will have capacity of 31 mcm (1.09 mcf) of gas per day.

The pipeline will transport gas from Chabahar in southwestern Iran and Ra’s al Jifan in Oman to Porbandar in Gujarat, with a possible extension to Mumbai in the future.

India, a country of 1.25 billion people, has a daily gas demand of 405 mcm (14.3 bcf). This demand has grown by 10 percent from the previous fiscal year. Demand is projected to grow by 29 percent to 523 mcm (18.5 bcf) per day by 2018 according to the country’s oil ministry. Most of India’s gas imports are used for power generation and by industrial customers.

South Asia Gas Enterprise (SAGE) is leading the project consortium. SAGE’s director Subodh Kumar Jain said that although it is a geopolitically sensitive project, the project is timely with the lifting of sanctions imposed on Iran. The pipeline bypasses the Pakistan’s exclusive economic zone in the Arabian Sea. India’s relations with Pakistan have been historically strained.

Once the pipeline is completed, companies will be able to buy gas from the National Iranian Gas Exports Company and pay SAGE a carrier fee, which will be set at $2.25 per British thermal unit.

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