Energy News  
Analysis: Pakistan unrest hurts pipelines

disclaimer: image is for illustration purposes only
by John C.K. Daly
Washington (UPI) Nov 9, 2007
On Nov. 3 Pakistani President Gen. Pervez Musharraf declared emergency rule in Pakistan.

In his "Proclamation of Emergency," Musharraf began with the country's rising troubles from rising militancy and terrorism, beginning by telling the nation, "There is visible ascendancy in the activities of extremists and incidents of terrorist attacks, including suicide bombings, IED explosions, rocket firing and bomb explosions and the banding together of some militant groups have taken such activities to an unprecedented level of violent intensity posing a grave threat to the life and property of the citizens of Pakistan," and ending by proclaiming, "The constitution of the Islamic Republic of Pakistan shall remain in abeyance."

India immediately closed the border and put its troops on heightened alert.

An unintended but significant byproduct of the proclamation is to kill, perhaps for good, any Pakistani or Indian hopes for sharing in the burgeoning Caspian basin energy exports, threatening some projects that have been on the drawing boards for years. Proposed pipelines include those to bring Turkmen and Iranian hydrocarbons via Pakistan and thence onward to India. The chaos in Afghanistan initially dimmed Indian and Pakistani hopes as the chaos, combined with other more stable suitors, most notably China, stepped into the breach with offers and funding. Islamabad's recent pronouncement seems hardly likely to quell the anxieties of potential Western investors, painfully aware this is the first time since 1945 that a nuclear-armed state has declared a state of emergency.

For the foreign investment community, Pakistan's announcement constitutes a triple whammy for possible pipeline projects -- Iran, one of the major potential providers of energy exports, remains under relentless U.S. sanctions pressure, while neighboring Afghanistan copes with a persistent Taliban insurgency six years after they were driven from power. Pakistan in turn faces a turbulent North West Frontier province along with a second of Pakistan's four provinces simmering in unrest, Balochistan.

Pakistan's announcement will undoubtedly drive all but the most stalwart investors away, with Moody's Investor Service downgrading Pakistan's credit ratings from "stable" to "negative," negatively affecting Pakistan's foreign and local B1 currency bonds as well as B2 foreign-currency Pakistani recommendations on bank deposits. Across the frontier, India can only watch and wait.

Musharraf's pronouncement imperils two longstanding high-profile initiatives -- the Iran-Pakistan-India natural gas project along with the Trans-Afghanistan Pipeline. Both now seem to be triumphs of wishfulness over reality, despite their long genesis.

TAP was first proposed in 1989 by India's Rajendra Kumar Pachauri, head of the Tata Energy Research Institute, in partnership with Iranian former Deputy Foreign Minister Ali Shams Ardekani. As envisaged, the proposed $3.5 billion, 1,044-mile pipeline was annually to transmit 33 billion cubic meters of Turkmen natural gas from its Dauletabad fields via Afghanistan through Pakistani sites Quetta and Multan to Fazilka.

IPI was equally ambitious, with the projected $3.5 billion pipeline to become operational in 2015, with Pakistan importing 3.15 billion cubic feet per day and India eventually importing 4.25 billion cubic feet per day through the IPI "peace pipeline."

In light of current developments, both projects seem stymied for some time, while both Russia and China move swiftly to take up the slack in assessing Iranian and Turkmen natural gas.

India's energy import problems in the short and long term will only increase. On Nov. 7 the International Energy Agency said in its World Energy Outlook 2007 report that the rapidly rising Indian economy by 2030 would have to import 90 percent of its oil to cover domestic needs because its domestic proven oil reserves are "small."

The report also concluded that by 2025 India would surpass Japan to become the world's third-largest oil importer before 2025, with domestic consumption needs rising as high as 6 million barrels a day by 2030. According to the IEA, demand for oil imports by China and India will almost quadruple by 2030, severely disrupting markets. Since 2005, China and India between them accounted for about 70 percent of the increase in global energy demand.

India, like China, however, is not putting all its energy eggs in one basket, and is seeking out new opportunities worldwide, most notably in Africa. New Delhi is hosting its first India-Africa Hydrocarbons Conference. Petroleum and Natural Gas Minister Murli Deora told the conference, "We are committed to ensuring our billion-strong nation affordable access to energy. To insulate our economy from the vagaries of the international oil market and inflationary pressures that could arise from transferring the entire price rise to end-users, the Indian government and the national oil companies are absorbing over 85 percent of the difference between cost of import and domestic oil prices." Pakistan's options remain much more limited.

Community
Email This Article
Comment On This Article

Related Links
Powering The World in the 21st Century at Energy-Daily.com



Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News


Analysis: Russia, Ukraine in gas spat
Washington (UPI) Nov 9, 2007
By now it has a familiar ring to it -- Moscow and Kiev are once again at loggerheads over imported natural gas prices. The issue has made political allies out of Ukrainian Prime Minister Viktor Yanukovych and President Viktor Yushchenko, normally at odds with each other.







  • Marquiss Wind Power Appoints Former Senior Intel And Flextronics Executive As CEO
  • Geothermal Energy Licence Granted
  • PPL Partners With Vermont Landfill To Develop Renewable Energy Generating Facility
  • Autodesks Architecture Solutions Simplify Sustainable Design For China Project

  • Japanese nuclear reactor shut after incident
  • Seven arrested in DR Congo radioactive waste dumping probe
  • Turkish parliament passes bill to build nuclear plants
  • DRCongo probes radioactive dumping from Chinese companies

  • A Breathable Earth
  • Researchers Find Origin Of Breathable Atmosphere Half A Billion Years Ago
  • Study Reveals Lakes A Major Source Of Prehistoric Methane
  • Giant Atmospheric Waves Over Iowa

  • Finnish paper mill to open in Uruguay despite Argentina's protests
  • Greenpeace urges Indonesia to stop burning forest
  • Chinese bamboo firm predicts fast growth after stock market bow
  • Europe's forests flourishing, but fire remain a threat: study

  • Global pest uses promiscuity to wipe out competition: study
  • Researchers say desalinated water harms crops: report
  • One third of Europe's freshwater fish face extinction: IUCN
  • Tuna fishing quota violators targeted in report

  • RAND Paper Finds Diesel, Hybrid Vehicles Can Provide More Societal Benefits Than Gas-Powered Autos
  • GM-backed college students win US military's robot car race
  • US military spurs robot car creations with big money race
  • Automakers trying to turn gas-guzzlers green

  • Virgin to offer carbon offsets alongside drinks and perfume
  • NASA sorry over air safety uproar
  • Airbus superjumbo makes first commercial flight
  • Airbus superjumbo takes off on first commercial flight

  • Nuclear Power In Space - Part 2
  • Outside View: Nuclear future in space
  • Nuclear Power In Space
  • Could NASA Get To Pluto Faster? Space Expert Says Yes - By Thinking Nuclear

  • The content herein, unless otherwise known to be public domain, are Copyright 1995-2007 - SpaceDaily.AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement