*IPI v *TAPI: Great War of Interests

Huzaima Bukhari & Dr. Ikramul Haq
 

The statement by US Ambassador in Pakistan at Lahore University of Management Sciences (LUMS) on November 25, 2011 that “Pak-Iran gas pipeline is not a good idea….however, the plan to get gas from Turkmenistan is a better idea”   was not mere reiteration of economic interests of the United States and its allies—it has serious political connotations as well in an area that has always been the battlefield of the Great Game. Pakistan government reacted strongly against Cameron Munter’s statement saying “Islamabad will not accept any dictation regarding its internal affairs from any foreign country. Gas from Iran is in the country’s best interest”.

After India’s pull out of [1]Iran-Pakistan gas pipeline project (IPI), wooed by the US through the civil nuclear deal, both China and Russia have shown interest in the project—Russian gas-export monopoly Gazprom and China National Petroleum Corporation have promised to help building the 780-kilometer pipeline.  It is worrisome for the US and its allies that China and Russian are emerging as supporters of IPI—their cooperation with Iran would certainly be harmful for American geopolitical interests in this region.

Pakistan Federal Minister for Petroleum and Natural Resources, Dr. Asim Hussain, in a TV interview in October 2011, said: “Our dependence on Pak-Iran pipeline is very high and there is no other substitute at present to meet the growing demand of the energy”. This statement irritated the Unites States, which has been pleading the case for Turkmenistan Gas project [2](TAPI) since 1990s. The TAPI was initially designed to provide Turkmen gas to Pakistan through Afghanistan. In April 2008, India was also invited to join in. Pakistan’s cabinet gave approval to the Gas Pipeline Framework Agreement (GPFA) for the TAPI in its meeting on October 27, 2010. On November 13, 2011, Pakistan and Turkmenistan initiated the Gas Sales and Purchase Agreement ([3]GSPA), which is likely to operationalize the multi-nation project by 2016. The two countries signed a total of five agreements and memoranda of understandings (MoUs).

The US and its allies want Pakistan to abdicate [4]IPI and pursue TAPI alone. This is not only unacceptable to Pakistan, Iran, China and Russia have also serious apprehensions about this project as main financial control over Turkmenistan gas reserves is with Western giant companies. Additionally, its viability is doubtful as pipeline will pass through Taliban-controlled regions and Pakistan’s troubled border regions. The cost as compared to IPI is also too high—Turkmenistan originally estimated total cost at $3.3bn, later raised it to $ 7.6 billion, while other estimates are as high as $10bn.

Iran wants to diversify gas sales to Asian markets and Asian countries. Tehran’s projection of IPI as peace pipeline has support of Russia and China. While regional powers desire to find a stable, reliable source of gas supplies, America and allies want to destabilize the entire region using militancy as a tool of foreign policy objective. The tussle over IPI and TAPI is, thus, not a mere economic battle but have far-reaching geopolitical dimensions. India’s betrayal under US pressure is a cause of concern for regional powers—now China and Russia are supporting Pakistan to withstand US pressure for non-participation in IPI.

It is a matter of record that much before 9/11, the US and its NATO allies decided to invade Afghanistan. The decision to this effect was taken inBerlinduring the joint meeting of Council of Ministers held in November 2000.  It exposes the claims of US and coalition partners that 9/11 was the sole reason for invading Afghanistan. The actual cause was apprehensions regarding Turkmenistan Gas Pipeline Project in which powerful corporate entities, who actually rule US and other capitalist countries, had financial interests.

George W. Bush appointed former aide to the American oil company UNOCAL, Afghan-born Zalmay Khalilzad, as special envoy to Afghanistan nine days after the US-backed interim government of Hamid Karzai took office in Kabul. This appointment underscored the real economic and financial interests at stake in the USmilitary intervention in Central Asia. Khalilzad was intimately involved in the long-running USefforts to obtain direct access to the oil and gas resources of the region, largely unexploited but believed to be the second largest in the world after the Persian Gulf[5].

As an advisor for UNOCAL, Khalilzad drew up a risk analysis of a proposed gas pipeline from the former Soviet Republic of Turkmenistan across Afghanistan and Pakistan to the Indian Ocean. He participated in talks between UNOCAL and Taliban officials in 1997, which were aimed at implementing a 1995 agreement to build the pipeline across western Afghanistan. UNOCAL was the lead company in the formation of the Centgas consortium, whose purpose was to bring to market natural gas from the Dauletabad Field in southeastern a 48-inch diameter pipeline from the Afghanistan-Turkmenistan border, passing near the cities of Herat and Kandahar, crossing into Pakistan near Quetta and linking with existing pipelines at Multan Turkmenistan, one of the world’s largest energy reserves.

The IPI and TAPI are symbols of New Great Game—the main goal of which is gaining control of oil and gas reserves in this region. ”The hidden stakes in the war against terrorism can be summed up in a single word: oil/gas. The map of terrorist sanctuaries and targets in the Middle East and Central Asia is also, to an extraordinary degree, a map of the world’s principal energy sources in the 21st century. It is inevitable that the war against terrorism will be seen by many as a war on behalf of America’s Chevron, Exxon, and Arco; France’s TotalFinaElf; British Petroleum; Royal Dutch Shell and other multinational giants, which have hundreds of billions of dollars of investment in the region.”[6]

This is the ugly reality of the ongoing war over IPI and TAPI. It unveils the hidden agenda of US and its allies to grab oil and gas resources for their economic interests benefiting huge multinational corporations in which the Western ruling elites have substantial interest.

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* Acronyms for gas pipelines, namely Iran-Pakistan-India and Turkmenistan-Afghanistan-Pakistan-India.

[1]This $1.2 billion project is lingering since 1995 when MoU was signed between Iran and Pakistan. The Iran-Pakistan Working Group was formed in 2003 to move the project forward. Islamabad told Tehran that in case India was unwilling to join, Iran-Pakistan gas pipeline would be pursued as an independent project; but in 2005, MoU was signed to include India. In 2007, India and Pakistan provisionally agreed to pay Iran US $ 4.93 per million British thermal units, but India subsequently withdrew from the deal ostensibly over concerns about the price and security but in fact, due to opposition from West, especially the US. Under the accord, signed in June 2010, Iran will provide about 21.5 million cubic meters of gas a day to Pakistan for 25 years. The deal can be extended by five years and volumes may rise to 30 million cubic meters a day.

[2] Under the proposed project, the 1,680 kilometer-long gas pipeline, backed by the Asian Development Bank, will bring 3.2 billion cubic feet of natural gas per day (bcfd) from Turkmenistan’s gas fields to Multan and end at the northwestern Indian town of Fazilka. This is a 48-inch diameter pipeline from the Afghanistan-Turkmenistan border, passing near the cities of Herat and Kandahar, crossing into Pakistan near Quetta and linking with existing pipelines at Multan. Under the agreement, Afghanistan’s share will be 500 million cubic feet per day (mmcfd), Pakistan’s share will be 1,325 mmcfd and India’s 1,325 mmcfd.

[3] GSPA is a follow-up of the “inter-governmental agreement” (IGA) signed by Pakistan President Asif Ali Zardari, Afghan President Hamid Karzai, Turkmenistan President Berdimuhamedov and Indian Petroleum Minister Murli Deora in the capital of Turkmenistan, Ashgabad, on December 11, 2010.

[4] On March 16, 2010 at Ankara and in Tehran, the Iranian President Mahmoud Ahmadinejad and Pakistani President Asif Ali Zardari signed the Inter-Governmental Framework Declaration on May 24, 2009. After the signing ceremony of the sovereign guarantee agreement, Pakistan’s Minister for Petroleum and Natural Resources said that the Gas Sale and Purchase Agreement between Pakistan and Iran was for the import of 750 million cubic feet daily of natural gas with a provision to increase it to one billion cubic feet per day. It is hoped that the gas will be available to Pakistan by 2014.

[5] The State Department was exploring the potential for post-Taliban energy projects in the region during the Bush government, having more than 6 percent of the world’s proven oil reserves and almost 40 percent of its gas reserves.  On December 15, 2001, in an article headlined, As the War Shifts Alliances, Oil Deals Follow, the New York Times reported that during a visit in early December to this region, Secretary of State Colin L. Powell said he was particularly impressed with the money that American oil companies were investing there. He estimated that $200 billion could flow into this region during the next 5 to 10 years.

[6] Frank Viviano, San Francisco Chronicle, September 26, 2001.

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The writers, partners in law firm HUZAIMA & IKRAM (Taxand Pakistan), are Adjunct Professors at Lahore University of Management Sciences (LUMS).

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