Govt to revive tri-nation gas pipeline talks

M Azizur Rahman

The government has decided to revive talks with neighbouring India and Myanmar to construct an over US$ 1.0 billion gas pipeline through Bangladesh to carry Myanmar gas to India, officials said Tuesday.

The energy ministry has already got a go-ahead signal from the Prime Minister to initiate renewed discussions with neighbours for setting up the 'long-shelved' regional gas pipeline, seen beneficial for all, a senior ministry official told the FE Tuesday.



Following the PM's instruction the issue has been forwarded to the foreign ministry for negotiating with the neighbouring countries, the energy ministry official said.

"We had tabled the issue to the PM recently to consider it as a prospective sector to boost regional cooperation, and the PM instructed to move forward with the plan," said a senior official.

As Bangladesh is now reeling under an acute energy supply crunch, it might seek rights of gas use from the pipeline apart from some other benefits including wheeling charge, he added.

The 950-km tri-nation gas pipeline was

proposed by Mohona Holdings, a private Bangladeshi company, about a decade ago in 1990s. But it was not until January 2005 that the three countries' energy ministers met for the first time to discuss the project. The following month they signed a draft memorandum of understanding (MoU).

The pipeline was expected to enter eastern Bangladesh through the border point at Brahmanbaria and then enter India's West Bengal state through the northern Rajshahi border area.

The draft MoU covered the provision of transit of hydropower from the Himalayas to Bangladesh through India, and a corridor across India for trade between Bangladesh, Nepal and Bhutan.

Bangladesh had tied the three-way pipeline deal to access to Nepal and Bhutan's hydropower, and have a corridor for Nepalese and Bhutanese goods to Bangladeshi ports through India, and reduce the imbalance of trade, which is in India's favour by some $2.0 billion.

India later resisted the link between the gas-line and the three other countries' trading arrangements and decided to open talks with Myanmar, in mid 2005.

They decided to form a joint working committee to explore the alternatives of gas transmission from Myanmar to India bypassing Bangladesh, which Bangladesh perceived as a clear departure from the agreement.

India and Myanmar in 2006 considered redesigning the gas pipeline so that it skipped Bangladesh altogether. It planned to run the pipeline from Myanmar through Mizoram and Assam before landing in West Bengal. The revised length was fixed at 1,400-km.

But since then, no headway has been made regarding the project, as China moved in and had a deal with Myanmar to purchase gas. The caretaker government had initiated a move to revive the project in 2007, but failed to move further.

Experts said there were gas reserves of around 5.0-6.0 trillion cubic feet (Tcf) in the blocks under discussion in Myanmar (block A-1 and A-2), from which gas is to be transported to India.

South Korean Gas Corporation (KOGAS) holds 50 per cent stake, India's Oil and Natural Gas Corporation (ONGC) 20 per cent, GAIL India 10 per cent, and the operator South Korean Daewoo holds 20 per cent stakes there.

Myanmar has enough gas to supply from its fields after meeting China's requirements, they said.