Pakistan, India differ on gas transit fee

Islamabad, Apr 16: Pakistan and India are poles apart on the transit fee of the 7.4 billion dollar Iran-Pakistan-India gas pipeline (IPI) project, a local media report claimed today.

The two countries are expected to further deliberate on the issue when they hold a ministerial-level meeting early next month in Islamabad, Dawn newspaper quoted an official as saying.

He added that India still continued to be engaged with the United States on the pipeline issue.

In a background discussion, the official said Pakistan had sought 10 per cent of the gas price on the Pakistan-India border as transit fee to provide right of way, security and safety to the pipeline and also involved taxes and other expenses.

At current oil prices, Pakistan expects transit fee at or around 50 cents per million British Thermal Unit (MMBTU). India is offering 15 cents per MMBTU.

''For the argument sake, India is saying Pakistan should seek transit fee only for about 240 km portion of the gas pipeline that will specifically be required up to the Indian border,'' said the official.

He said New Delhi argued that since about 795 km pipeline from the Pakistan-Iran border will also be utilised by Pakistan, there should be no transit fee for this segment.

The official said it was almost certain that the pipeline would enter Pakistan's off-take point near Hyderabad and it would run about 795 km with a diameter of 56 inches through the coastal route.

The gas would then flow through a 240 km pipeline of 42 inches diameter to reach Indian off-take point of Barmer, making a total of 103 kms in Pakistan.

UNI