India is set to push for the proposed $7-billion gas pipeline from Iranvia Pakistan, seeking to grab the opportunity presented by the nuclear deal between the gulf country and major powers of the world this month that has lifted the fog of restrictions.
A senior oil ministry official will lead a delegation of oil industry executives shortly to Iran to press for India's interest in revival of the pipeline project that was put on the back burner for years as well as developing the Farzad-B block, a person with knowledge of the matter said.
Energy-hungry India wants to resurrect Iranian oil and gas projects that were stalled for years under pressure from the United States, which had accused Iran of pursuing nuclear weapon development programme and imposed sanctions, the person said.
A consortium of state-run companies - ONGC Videsh, Oil India and Indian Oil Corporation - had discovered gas in the Farzad-B block in Iran in 2008 and subsequently prepared a field development plan to recover about 12.8 trillion cubic feet of gas.
The plan had to be abandoned following the US sanctions, but India is now hoping to get the block back for development since it has already spent $90 million on exploration.
"We need to understand what's on their mind and how we can expedite things," said the person, who is part of the Indian delegation set to visit Iran in about a week. "We will have to present our case for the Farzad block. We also need to discuss all possible ways to evacuate gas from that field so that it can be brought to India for consumption. This will include a discussion on the possibility of laying a pipeline from Iran via Pakistan."
Following meetings between the delegations of the two countries about three months ago, Iran had asked India to present a new plan for the development of the field. India is readying the plan, the person said.
Much like the Farzad block, the plan to lay Iran-Pakistan-India pipeline was also abandoned by India under pressure from the US, which pushed the country into working towards an alternative gas transport line from Turkmenistan via Afghanistan and Pakistan.
Construction is yet to begin on the pipeline from Turkmenistan despite years of negotiations as the countries have failed to appoint a consortium leader that will build and maintain the line.
For India, the cross-border energy pipelines have scarcely progressed beyond announcements. Besides Iran and Turkmenistan, the government has been considering pipelines from Kazakhstan, Russia and Myanmar too.
India imports nearly 80 per cent of its crude oil requirement and about a third of its gas requirements. High prices and capacity constraints have, however, held back gas imports into the country.
The sharp fall in prices of crude oil over the past year and the convenience that pipelines bring have the potential to push up India's consumption of gas, which is considered cleaner than other fuels. Several power plants, especially in South India, have been lying idle for want of cheap gas which dried up due to falling local supplies.