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India, Myanmar exploring to bypass Bangla for gas pipeline

From The Hindustan Times, India
July 9, 2005
link to this article.

With Bangladesh putting roadblocks in the way of the proposed Myanmar-India gas pipeline, New Delhi and Yangoon today decided to explore other options for importing gas from offshore Myanmar.

A techno-commercial group would examine possibility of laying the pipeline by-passing Bangladesh and importing gas through ships in its liquefied (LNG) or compressed state (CNG), Petroleum Minister Mani Shankar Aiyar said at the conclusion of day-long deliberations with Myanmerese Energy Minister Lun Thi here.

Dhaka, which had in January agreed to passage of the pipeline through its territory, has now demanded from India a trade and power corridor to Nepal and Bhutan and measures to reduce Bangladesh's two-billion dollar trade deficit.

New Delhi has opposed making bilateral issues part of a trilateral agreement.

The pipeline is to carry gas found in Bay of Bengal block A-1 and possible reserves in adjoining A-3 and other blocks. Indian firms ONGC Videsh Ltd and GAIL have 30 per cent stake in the A-1 and A-3 blocks.

Thi said A-1 block holds 11.9 to 19.4 trillion cubic feet of gas reserves and India's share from it would be 11-12 per cent.

Aiyar said possibility of taking the pipeline from Myanmar into Mizoram and onwards to Assam and culminating in West Bengal, a distance of 1400 km, would also be explored. This route is roughly double the length the pipeline would travel if it were to pass through Bangladesh.

Aiyar said Myanmar, which had banned foreign companies from exploring for oil and gas in onland blocks, would consider the bid by Oil India Ltd consortium for two blocks as a special case.

OIL-Indian Oil Corp-GAIL had last month bid for onshore blocks RSF-6 and RSF-9. Yangon was also open to Indian firms bidding for offshore blocks.

However, talks on export of diesel from Numaligarh Refinery Ltd to Myanmar have not progressed well, Aiyar said, adding discussions would shortly resume on price, delivery point, specification of diesel and mode of payment.

"The Myanmar side indicated that while to begin with, they need 12,000 tonnes per annum of diesel, the demand is likely to grow much more," he said. GAIL has also proposed to put up a LPG extraction plant with 256,000 tonnes per annum capacity in Myanmar, he said.

Officials said the External Affairs Ministry has opposed acceding to Bangladesh's demand for a trade and power corridor to Nepal and Bhutan and measures to reduce Dhaka's trade deficit with India, which stands at a staggering two billion dollars.

The MEA has noted that "under no circumstances should India accept any of the (Bangladesh's) conditions... That will encourage Dhaka to tie up unrelated conditionalities in future negotiations on other issues, as it is always prone to do. India will always consider bonafide demands from Bangladesh but they cannot start unfair bargaining."

The proposed pipeline would start from Arakan in Myanmar and enter the northeastern states of Mizoram and Tripura before penetrating Bangladesh through the Brahmanbaria area and on to the Rajshahi border and Kolkata.

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