The Energy Sector

[James-Bond]

Iran, Pakistan, Syria, Qatar: Pipelineistan at work


Iranians work on a section of a pipeline linking Iran and Pakistan after the project was launched during a ceremony in the Iranian border city of Chah Bahar on March 11, 2013. (AFP Photo / Atta Kenare)

Construction is nearing completion on a natural gas pipeline linking Iran and Pakistan, a project that portends a huge geopolitical shift. As regional powers strengthen ties in this key energy market, they're looking to China, and away from the West.

Since the early 2000s, analysts and diplomats across Asia have been dreaming of a future Asian Energy Security Grid.

This – among other developments – is what it’s all about, the conclusion of the final stretch of the $7.5 billion, 1,100-mile natural gas Iran-Pakistan (IP) pipeline, starting from Iran’s giant South Pars field in the Persian Gulf, and expected to be online by the end of 2014.

Nobody lost money betting on Washington’s reaction; IP would put Islamabad in “violation of United Nations sanctions over [Iran’s] nuclear program.” Yet this has nothing to do with the UN, but with US sanctions made up by Congress and the Treasury Department.

Sanctions? What sanctions? Islamabad badly needs energy. China badly needs energy. And India will be extremely tempted to follow, especially when IP reaches Lahore, which is only 100 km from the Indian border. India, by the way, already imports Iranian oil and is not sanctioned for it.

All aboard the win-win train
When Iranian President Mahmoud Ahmadinejad and Pakistani President Asif Zardari met at the Iranian port of Chabahar in early March, that was a long way after IP was first considered in 1994 – then as Iran-Pakistan-India (IPI), also known as the 'peace pipeline.' Subsequent pressure by both Bush administrations was so overwhelming that India abandoned the idea in 2009.

IP is what the Chinese call a win-win deal. The Iranian stretch is already finished. Aware of Islamabad’s immense cash flow problems, Tehran is loaning it $500 million, and Islamabad will come up with $1 billion to finish the Pakistani section. It’s enlightening to note that Tehran only agreed to the loan after Islamabad certified it won’t back out (unlike India) under Washington pressure.

IP, as a key umbilical (steel) cord, makes a mockery of the artificial – US-encouraged – Sunni-Shia divide. Tehran needs the windfall, and the enhanced influence in South Asia. Ahmadinejad even cracked that “with natural gas, you cannot make atomic bombs.”

Zardari, for his part, boosted his profile ahead of Pakistan’s elections on May 11. With IP pumping 750 million cubic feet of natural gas into the Pakistani economy everyday, power cuts will fade, and factories won’t close. Pakistan has no oil. It may have huge potential for solar and wind energy, but no investment capital and knowhow to develop them.

Politically, snubbing Washington is a certified hit all across Pakistan, especially after the territorial invasion linked to the 2011 targeted assassination of Bin Laden, plus Obama and the CIA’s non-stop drone wars in the tribal areas.

Moreover, Islamabad will need close cooperation with Tehran to assert a measure of control of Afghanistan after 2014. Otherwise an India-Iran alliance will be in the driver’s seat.

Washington’s suggestion of a Plan B amounted to vague promises to help building hydroelectric dams; and yet another push for that ultimate 'Pipelineistan' desert mirage – the which has existed only on paper since the Bill Clinton era.

The Foreign Office in Islamabad argued for Washington to at least try to show some understanding. As for the lively Pakistani press, it is having none of it.


This photograph taken on February 12, 2013 shows the construction site at Gwadar port in the Arabian Sea. (AFP Photo / Behram Baloch)

The big winner is… China
IP is already a star protagonist of the New Silk Road(s) – the real thing, not a figment of Hillary Clinton’s imagination. And then there’s the ultra-juicy, strategic Gwadar question.

Islamabad decided not only to hand over operational control of the Arabian Sea port of Gwadar, in ultra-sensitive southwest Balochistan, to China; crucially, Islamabad and Beijing also signed a deal to build a $4 billion, 400,000 barrels-a-day oil refinery, the largest in Pakistan.

Gwadar, a deepwater port, was built by China, but until recently, the port's administration was Singaporean.

The long-term Chinese master plan is a beauty. The next step after the oil refinery would be to lay out an oil pipeline from Gwadar to Xinjiang, parallel to the Karakoram highway, thus configuring Gwadar as a key Pipelineistan node distributing Persian Gulf oil and gas to Western China – and finally escaping Beijing’s Hormuz dilemma.

Gwadar, strategically located at the confluence of Southwest and South Asia, with Central Asia not that far, is bound to finally emerge as an oil and gas hub and petrochemical center – with Pakistan as a crucial energy corridor linking Iran with China. All that, of course, assuming that the CIA does not set Balochistan on fire.

The inevitable short-term result anyway is that Washington’s sanctions obsession is about to be put to rest at the bottom of the Arabian Sea, not far from Osama bin Laden’s corpse. And with IP probably becoming IPC – with the addition of China – India may even wake up, smell the gas, and try to revive the initial IPI idea.

The Syrian Pipelineistan angle

This graphic Iranian success in South Asia contrasts with its predicament in Southwest Asia.

The South Pars gas fields – the largest in the world – are shared by Iran and Qatar. Tehran and Doha have developed an extremely tricky relationship, mixing cooperation and hardcore competition.

The key (unstated) reason for Qatar to be so obsessed by regime change in Syria is to kill the $10 billion Iran-Iraq-Syria pipeline, which was agreed upon in July 2011. The same applies to Turkey, because this pipeline would bypass Ankara, which always bills itself as the key energy crossroads between East and West.



It’s crucial to remember that the Iran-Iraq-Syria pipeline is as anathema to Washington as IP. The difference is that Washington in this case can count on its allies Qatar and Turkey to sabotage the whole deal.

This means sabotaging not only Iran but also the 'Four Seas' strategy announced by Syrian President Bashar al-Assad in 2009, according to which Damascus should become a Pipelineistan hub connected to the Caspian Sea, the Black Sea, the Persian Gulf and the Eastern Mediterranean.

The strategy spells out a Syria intimately connected with Iranian – and not Qatari – energy flows. Iran-Iraq-Syria is known in the region as the 'friendship pipeline.' Typically, Western corporate media derides it as an 'Islamic' pipeline. (So Saudi pipelines are what, Catholic?) What makes it even more ridiculous is that gas in this pipeline would flow to Syria and then Lebanon – and from there to energy-starved European markets close by.

The Pipelineistan games get even more complicated when we add the messy Iraqi Kurdistan/Turkey energy love affair – detailed here by Erimtan Can – and the recent gas discoveries in the Eastern Mediterranean involving territorial waters of Israel, Palestine, Cyprus, Egypt, Lebanon and Syria; some, or perhaps all of these actors could turn from energy importers to energy exporters.

Israel will have a clear option to send its gas via a pipeline to Turkey, and then export it to Europe; that goes a long way to explain the recent phone call schmoozing between Turkey’s Prime Minister Erdogan and Israel’s Netanyahu, brokered by Obama.

Terrestrial and maritime borders between Israel and Lebanon remain dependent on a hazy UN Blue Line, set up way back in 2000. Damascus – as well as Tehran – supports Beirut, once again against Washington’s will. And Damascus also supports Baghdad’s strategy of diversifying its means of distribution, once again trying to escape the Strait of Hormuz. Thus, the importance of the Iran-Iraq-Syria pipeline.

No wonder Syria is a red line for Tehran. Now the whole of Pipelineistan will be watching how far Qatar is willing to go following Washington's obsession.

Source

[united pakistan]

ISLAMABAD: Taking a tough stand despite increasing pressure from the United States, Iranian Consul General Hassan Darvishvand has said that the long awaited Iran-Pakistan (IP) gas pipeline is to be completed "at all costs" by the end of 2014.
Darvishvand further said, 110 million cubic feet of gas will be available to Pakistan per day under the project. This, he added, would solve much of the electricity gas shortage in the energy-starved country, The Meher News Agency quoted.
He said the pipeline, originating from Iran's Faras province, would extend over a distance of 1,100 kilometres within Iran, adding that a mere 100 kilometres worth of work is left on the Iranian side of the project. He said 780 kilometres of pipeline will be laid within Pakistan and construction work began a month ago.
The cost of the project in Pakistan was around 1.5 billion dollars, out of which 500 dollars million will be provided by Iran, while the rest of the cost will be met by the host country, he said.

[united pakistan]

ISLAMABAD: Water and Power Development Authority (WAPDA) has started construction work on Darawat dam and Nai Gaj dam in Sindh province.
According to an official of WAPDA, the dams would irrigate over 25000 barren land of Hyderabad and Dadu.
The construction of site camps is completed including soil investigation of dam and spillway sites.
The Darawat dam is located at about 70 kilometres west of Hyderabad and 135 kilometres North East of Karachi across Nai Baran near Jhangir village in Jamshoro district of Sindh.
To a question, official said the dam will help conserve flood water of Nai Baran and irrigate 25,000 acres of fertile land adding the dam will help socio economic uplift of remote areas of Sindh and women emancipation and especially fisheries development.
Replying to the question of financial progress, he said PSDP allocation for financial year 2012-13 for constructing dams in Sindh are Rs2000,000 million and expenditure up to February, 2013 were Rs 2027.414 million and cumulative expenditures up to February 2013 were Rs4334.677 million.
Topographic survey of dam, command area and reservoir area is completed and excavation for foundation of dam is completed, he said.
He said concrete pouring work of the dam is in progress and 92 percent work is completed and construction of irrigation system is in progress and 15 percent completed.
Talking about Nai Gaj dam project he said this dam is proposed across Gaj River in the gorge area at the edge of Kirthar range about 65 kilo meter north west of Dadu city in Sindh province.
To a question, he said the objective of this dam to irrigate agriculture development and flood control and fisheries development and uplift socio economic conditions inspiring emancipation of women and poor community of the area.

[RFSK]

#Metropole#
Hey couldn't you make a separate thread for the Iran-Pakistan gas pipeline, since it's a significant project? I could do it my self, but would be easier if you did it, cause then you could move the related post's over...

[Naresh]

.

Change of heart : Ministry dithers over release of funds for IP pipeline

ISLAMABAD : The Ministry of Finance is finding it difficult to set aside millions of dollars collected from gas consumers for the Iran-Pakistan gas pipeline project, as heavy spending by the past government on power subsidies and development projects for political gains has eaten into the resources of the ministry, making its financial standing weak.

The Pakistan Peoples Party (PPP)-led coalition government, which completed its tenure last month, had imposed gas infrastructure development cess on gas consumers to finance the IP pipeline and collected $400 million, sources say.

An assignment account was opened in a bank in the wake of a decision of the cabinet to deposit the cess, but the finance ministry failed to credit the amount into the account because of shortage of funds.

Sources pointed out that initially a cash call of $300 million was made to the ministry to transfer the amount to the assignment account, which would meet the needs up to June this year. However, the ministry did not deposit the cess, instead it insisted that it would release the funds at the time of payments to contractors.

According to estimates, $1 billion will be required before the end of December 2014.

Sources attributed the vulnerable financial position of the finance ministry to hefty power subsidies and excessive spending by the previous government for political gains.

In the current fiscal year, the PPP-led government froze power tariff to avoid the wrath of voters in upcoming elections and doled out Rs268 billion in power subsidies against the target of Rs185 billion.

Former prime minister Raja Pervez Ashraf also spent more than his discretionary fund earmarked in the budget, leaving the finance ministry with little to spend.

According to officials, like the gas infrastructure cess, petroleum development levy, which was imposed to develop the oil sector, was used to bridge the budget deficit.

“The government should have opened an assignment account soon after imposing the gas infrastructure cess to avoid its misuse,” an official suggested, but said Pakistan and Iran had not yet signed the award of pipeline construction contract to Iranian firm Tadbir Energy.

Officials said Pakistan had collected $400 million as cess and $500 million would be provided by Iran for the IP project. China is also expected to lend $500 million.

“If the government secures financing from these sources, it will have enough money to fund the $1.35 billion gas pipeline,” the official said.

As the cabinet has approved the provision of funds, the officials hoped that the cess would be released to meet the needs of the IP project.

“Considering the fact that achieving financial close of the project is necessary and moving ahead on a piecemeal basis is not an option, funds required to kick-start construction activities and the remaining funds should be released by the finance ministry immediately,” said the petroleum ministry.

When approached, the finance ministry spokesman confirmed that funds had so far not been credited to the assignment account. However, he said, “there is no shortage of funds and we are in the process of transferring the money.”

Cheers

[Kleemann]

Thermal power plants are consuming 27,000 tons per day of mostly imported oil for generating power at Rs 16 per unit, which the government is supplying to the consumers at Rs 8 per unit, incurring huge losses.

Does it make sense for the PPP to say that had Benazir’s energy policy not been reversed things would have been much better?
On the contrary, things would have been much worse. We would have been importing and consuming even more oil and producing expensive power and subsidising it.
This propaganda by the PPP is to cover up the faulty policy of putting all our eggs in the thermal basket. The IPPs at best should have been a short-term measure. If long-term hydel projects had been initiated at the same time, we would not be importing oil today and would be getting power at about Rs 1 per unit.
We would also be getting ample water for irrigation. Indeed, it is bad enough to pursue a faulty policy, but it is even worse to praise it to the skies and to pull wool over people’s eyes.
In view of the very adverse impact on the economy, even the former Prime Minister had said that no more oil-based power plants would be installed in the future. What I cannot understand is why they are not considering solar energy at all?
ENGR KHURSHID ANWER,
Lahore, April 18.

Source: http://www.nation.com.pk/pakistan-ne...13/all-hogwash

[O2-Lahore]

These IPP's can be made to run on coal, but don't know why they didn't opt for this.

[Naresh]

.

Pakistan seeks Coal India help to mine Thar

As Pakistan gears up to start exploiting what is claimed to be the world's third-largest coal deposit, buried in the Thar desert, it has approached Coal India, the world's largest coal miner, for assistance.

Sindh Engro Coal Mining Co, a joint venture between Pakistan’s Sindh government and Engro Corp, which has been given Pakistan’s largest lignite deposit, has started discussions with Coal India’s subsidiary Central Mine Planning and Design Institute (CMPDIL) to share expertise on how to effectively and economically mine a vast but difficult lignite deposit, according to sources privy to the development.

The mine is spread over 95 sq km and holds reserves of 2 billion tonne.

CMPDIL, the technical arm of Coal India, is currently busy selecting private partners for Coal India to jointly develop domestic mines, as reported by dna earlier.

Long overlooked by global energy experts, Pakistan in 1992 discovered that it is sitting on a reserve of 200 billion tonne of coal, close to India’s 276 billion tonne.

But despite having such enviable reserves, it has not been able to exploit the coal so far.

As Thar coal is not suitable for transportation, Pakistan is now looking at mouth-of-mine applications like coal gasification or coal-to-liquid for which it needs outside expertise, officials of CMPDIL said.

But why would Pakistan want India’s help in exploiting its lignite deposits, given the not-so-warm and often-strained relations between the two countries?

Well, the nature of the lignite deposit, as admitted by Pakistan’s experts, is similar to the lignite found in Rajasthan across the border, which has a reserve of more than 1 billion tonne.

Pakistan also needs to hurry as it is faced with acute power shortage, generating just 8,500 megawatt (mw) of electricity against a demand of 13,000 mw.

With no new major gas finds in recent past, Pakistan needs to develop coal-based power plants.

In fact, Sindh Engro had also got in touch with companies like Tata Power and Bharat Heavy Electricals for technology transfers, as reported in Pakistan media.

Sindh Engro initially plans to produce 600 mw electricity, to be completed in four years.

Opportunities for Indian companies, from Coal India to power sector companies are huge as Sindh government intends to develop 10 such blocks in Thar with an aim to produce 20,000 mw of electricity by 2030.

Cheers

[RFSK]

Three-member ministerial committee formed on energy

ISLAMABAD - A three-member committee comprising federal ministers for petroleum, water and power and adviser on finance, has been constituted to review the energy situation and give its recommendations to improve the power situation in the country.
This decision was taken by Prime Minister Mir Hazar Khan Khoso while chairing a high level meeting to review the energy situation in the country.
The meeting was informed that the current power generation in the country was 9,200 MW against a demand of 13,000MW. The PM was informed that only 55 mmcfd gas was being provided to the thermal power plants against the promised 150mmcfd gas.
The meeting also reviewed the position of recovery of dues and the quantum of funds required to produce optimum generation. It was also decided during the meeting to setup a mechanism to monitor the generation and demand of electricity in the country. The PM directed the Ministry of Water and Power to ensure that uninterrupted electricity was available in the country for the evening of May 10 for the next 36 hours to ensure that the process of polling and counting of votes is completed smoothly.
Gwadar-Ratodero Road: Meanwhile, presiding over another meeting to review progress on the Gwadar-Ratodero Road, Prime Minister Khoso said the government will accelerate the pace of work on the project so that people of Pakistan could reap the benefits of the Gwader port.
Khoso issued instructions that work on Khuzdar-Ratodero section and Hoshab-Gwadar section should be completed during the next 12 months while work on N-85 Road and N-30 should be prioritised for early completion of these linkages with Gwadar.
The PM was informed that the total road network of the country was spread over 12,131 kilometres of which over 37 percent of the roads comprised those in Balochistan. He said that the completion of this road is not only important for linking Gwadar with the rest of the country but it would also stimulate development in the area from Gwadar up till Ratodero.
The meeting was attended by Minister for Communication Asadullah Khan Mandokhel‚ Advisor to the Prime Minister on Finance Dr Shahid Amjad Chaudhry and Chairman National Highway Authority Hamid Ali Khan.

[paklove]

[Ahmad Rashid Ahmad]

Blueprints of Bunji Dam complete

On Monday, the Water and Power Development Authority (Wapda) announced that it has completed detailed engineering design and tender documents of the 7,100-megawatt (MW) Bunji Hydropower Project, and will soon initiate the process to undertake construction of one of the largest dams in Pakistan.

Pakistan and China signed a memorandum of understanding for the Bunji Dam in 2009. The accord was signed between the Ministry of Water and Power and Three Gorges Project Corporation of China.

Wapda Chairman Syed Raghib Abbas Shah broke this news in a meeting with Gilgit-Baltistan (G-B) Chief Secretary Sajjad Saleem Hotiana, while discussing various Wapda projects located in the province.

Speaking on the occasion, Shah said that mega-dams such as Bunji and Diamer-Bhasha will not only help stabilise the economy but also help usher a new era of social and economic development in G-B. He also praised the G-B government’s cooperation in implementing Wapda projects in the region.

“Wapda will fulfil all its commitments during the construction of the projects in the province and resettlement of the displaced,” said Shah.



During the meeting it was also announced that the G-B government will complete the ground survey and geographical mapping through satellites of Diamer-Bhasha Dam project in two weeks.

The matter pertaining to handing over the government land to Wapda also came under discussionto which the Wapda chairman said that in view of the significance of resettlement of the displaced people due to construction of the Diamer-Bhasha project, priority should be given to acquire land for construction of model villages in the region.

Deliberations were also made about the Satpara Dam, Harpo, Bashoo and Phander hydropower projects. It was decided in the meeting that a study will jointly be conducted by Wapda and G-B to address the issues related to Satpara Dam.

The study will also assess the future requirements of water in Skardu and adjacent areas, their fulfilment through Shatung Nullah, its environmental impact and a way forward for the purpose.

The meeting also agreed to devise a perpetual operation and management methodology for Satpara Dam Project with active involvement of the province.

[Naresh]

.

PSO to set up refinery to help meet energy needs

ISLAMABAD : The Pakistan State Oil’s (PSO) efforts to set up state-of-the-art oil refinery in Khyber Pakhtunkhwa, having capacity to process 40,000 barrel per day would go a long way in meeting the growing energy needs.

The facility, expected to be fully commissioned by 2016-17 will be set-up through a public private partnership and will utilise crude oil from nearby indigenous supply sources for production of POL products conforming to Euro IV standards, sources reveal.

‘Establishment of this refinery will help improve the overall availability of POL products across the country as well as result in sizeable foreign exchange savings for the nation and it shall also increase PSO’s operational base through diversification in the midstream segment and lower distribution cost in the related supply envelopes,’ the sources added.

In addition to these benefits, the sources said this refinery will also help create job opportunities for the local populace as well as professionals from various technical backgrounds, adding it is also expected that substantial foreign direct investment will also take place as a result of this project. app

Cheers

[Azmuh]

How many dams and other projects are underway.....i haven't heard about a single one that is near completion they are 4-5 years away

[paklove]

[OmI92]

[brightside.]

How is this guy giving 'orders' even before a government has been formed?

[decentguy]

are you pti supporter? lols nobody is giving orders he is discussing his plans for the energy crisis , plz highlight the order wala part?

[shakeelahmadch]

Originally Posted by brightside.

How is this guy giving 'orders' even before a government has been formed?

because he's the next prime minister - I hope you are still not dreaming like other PTI followers

[Aneesali]

Chinese premier pledges Pakistan energy crisis help

source: bbc.co.uk/news/world-asia-22624871

Chinese Premier Li Keqiang has said that co-operation on power generation in Pakistan should be a priority for both countries.

In a visit to Pakistan, Mr Li said they should focus on "priority projects in connectivity, energy development and power generation" in addition to building a bilateral economic corridor.

Mr Li arrived in Pakistan for trade talks on Wednesday after leaving India.

He is due to hold meetings with politicians including Nawaz Sharif.

Following elections last week Mr Sharif is expected to form the next government.

Mr Li told Pakistani media that there was still "great potential" for Sino-Pakistan relations.

Bilateral trade last year rose above $12bn (£8m) for the first time and both sides are aiming to reach $15bn in the next two or three years.

But Pakistan's energy crisis has led to power cuts of up to 20 hours a day, bringing its economy to a near standstill.

The power shortages have sparked violent protests, crippling key industries and resulting in thousands of job losses in a country already having to deal with high unemployment, a weak economy, widespread poverty, sectarian bloodshed and a Taliban insurgency.

China has already provided Pakistan with two nuclear reactors, each with a capacity of 300 MW, at Chasma in Punjab province.

The two countries are also planning to build two more reactors with the same capacity at Chasma - a development which the US has warned could boost Pakistan's nuclear weapons programme.