• Energy

    Swapping Turkmenistan Gas a Win-Win Collaboration

    The National Iranian Gas Company is ready to transfer Turkmenistan’s gas not only to Pakistan, but also to far-flung destinations such as India

    Transferring Turkmenistan's gas to Pakistan via Iran-Pakistan gas pipeline, aka Peace Pipeline, will benefit both neighboring states, the National Iranian Gas Company's managing director said.

    "Concluding swap deals can help Iran consolidate its position in the international gas markets," Hamidreza Araqi was also quoted as saying by ILNA.

    According to the official, NIGC is ready to transfer Turkmenistan's gas not only to Pakistan but also to far-flung destinations such as India.

    "The joint venture can benefit both countries," Araqi said, adding that such operations can stabilize both states' status in foreign markets.

    The Peace Pipeline is an under-construction 2,775-kilometer pipeline to deliver natural gas from Iran to Pakistan. The two countries signed an agreement in 2009 to implement the project.

    Because of its geopolitical advantage, Iran has signed several swap deals in different sectors of energy with its neighbors. 

    According to Araqi, Iran currently swaps natural gas from Turkmenistan to Azerbaijan. 

    Pointing to quality as an indispensable part of swap deals, the official noted that if a contract is signed between Tehran and Ashgabat, NIGC will be committed to deliver quality fuel to Pakistan as it has been doing so in transferring Turkmenistan's gas to Azerbaijan.

    Referring to the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project, the official said, "The pipeline is unlikely to become operational and pose a challenge to Peace Pipeline."

    Araqi added that even if the project is completed, there remain several obstacles, including security of the pipeline, which undermines its implementation. 

    TAPI is a planned 1,800-kilometer stretch of pipeline aimed at transferring natural gas from Turkmenistan to India.

    Turkmenistan is exploring options on gas swap deals with Iran to export its fuel to markets further afield.

    Because of economic challenges, Turkmenistan has been seeking to find more buyers for its natural gas riches other than China.

    However, Ashgabat has since January 2017 been embroiled in a row with Iran over allegedly unpaid gas bills. In short, Turkmenistan claims Iran owes it around $1.5 billion for gas it delivered in previous years. 

    Tehran has rejected the claim and insisted it wants to resolve the disagreement through international arbitration.

    “Turkmenistan is currently sending nearly 6 million cubic meters of gas to Azerbaijan through Iran,” the NIGC official said.

      IGAT-7 Expansion

    "Iran Gas Trunkline 7 (IGAT-7) was initially aimed at exporting the country's gas to Pakistan and India, although domestic needs are prioritized over export," he said.

    The pipeline stretches over 900 km between Asalouyeh, Bushehr Province, and Iranshahr, Sistan-Baluchestan Province, pumping natural gas from the giant South Pars Gas Field in the Persian Gulf. 

    "After it becomes fully operational, the whole capacity of IGAT-7, at 110 mcm per day, will be used to provide southeastern cities, including Bandar Abbas, Jask and Chabahar, with the fuel," Araqi said.

    The official noted that close to 30 mcm of natural gas are transferred through the pipeline daily, most of which is delivered to power plants and industrial units.  

    Araqi emphasized that IGAT-7 can play a key role in the economic development of the region and because of the large number of power plants in the area, the establishment of another pipeline beside IGAT-7 is on NIGC's agenda.