Pipe dreams?


We must, perforce, find alternatives to TAPI and IPI

Reportedly, Pakistani and Indian gas giants Interstate Gas System (Private) Ltd and GAIL respectively have signed a Gas Sale Purchase Agreement (GSPA) with Turkmenistan on 23rd of May at Caspian resort of Avaz in Turkmenistan. The development has been hailed as a “truly historic moment” by the Asian Development Bank, which is providing financial backing for laying the 1735 Km long pipeline (TAPI) that purports to carry 27 billion cubic metres of gas annually to Afghanistan, Pakistan and India, with a potential to increase it to 33 billion cubic metres. Pakistan and India have also agreed on the rate of 49.5 cents per mmbtu as transit fee for supply of gas via the TAPI gas pipeline recently. The Indian cabinet has also given approval for signing of the GSPA as well as payment of the transit fee to Afghanistan and Pakistan for allowing the pipeline to pass through their territories.

The pipeline estimated to be built at a cost of US$ 7.6 billion would pass through Herat, Kandahar in Afghanistan, and then Balochistan and Multan before entering Indian Punjab. On the face of it, these initiatives look very promising for energy-starved Pakistan. However, the prospect of completing the project by the contemplated time schedule of 2017 (it was 2014 earlier) looks as elusive as ever.

The project initially conceived in 1995 has failed to take off the ground due to the security situation in Afghanistan which remains as precarious as ever even today. Presently, nearly 25 percent of the area of Afghanistan is under the effective control of the Taliban. The proposed pipeline has to pass through those areas. With no prospect of peace in Afghanistan in the near future, the project will remain in limbo till such time peace returns to that war-ravaged country. God knows when that will happen. The option of TAPI, also called peace pipeline by some, therefore needs to be taken out of our future plans till the settlement of the Afghan conundrum.

The prospects of IPI ever becoming a reality are also very bleak, despite the fact that Pakistan has repeatedly expressed its resolve to go ahead with the venture. The US is deadly against the IPI and has been applying continuous pressure on Pakistan to abandon this project, going as far as threatening of dire consequences. Secretary of State Hillary Clinton responding to questions in the House Appropriations Sub Committee on State and Foreign Operations on 1, March 2012 warned that Pakistan could face US sanctions if it pressed ahead with its proposed gas pipeline project with Iran. She said that the US administration recognises Islamabad’s essential energy needs. However, she added, construction of a gas pipeline from Iran to Pakistan would mean a violation of US legislation on sanctions against Iran.

The danger is that the US administration can even lobby to get UN sanctions passed against us besides having the recently announced EU concession for access to our textiles to their markets withdrawn and also cutting the volume of assistance drastically. The portents in this regard are already visible. The question then is that whether we are in a position to absorb these shocks? The prudent answer is, No. Sentiments apart, why should we go for such a risky undertaking when other more feasible and less risky options are available?

The energy crisis currently gripping the country, honestly speaking, is a cumulative effect of the neglect of this vital sector by the successive rulers coupled with the short-sightedness of our planners during the last decade and a half. The country has gone from being well-positioned to become a potential exporter of electricity when the last Benazir government fell to facing a shortage of 3500 MW of electricity when the present government assumed power in 2008. Though the government has added 3400 MW of electricity, yet the gap between generation of power and demand is continuously on the increase due to a host of factors. These include below capacity production, feeble economy, non-availability of required resources to invest in the energy sector, decrease in foreign aid flows, line losses, electricity theft, resistance to government efforts to tackle the problem through short-term solutions and non-materialisation of mega projects like TAPI and IPI pipelines.

The snowballing energy crisis has not only devastated the industrial sector but has also caused lot of agony for the household consumers of electricity. The planners will perforce have to find appropriate alternatives to TAPI and IPI. The country is caught in a vicious circle and it would require a huge and well thought out initiative — with the consensus of all stakeholders — aimed at providing relief to industry and the masses in the short run and also geared to catering for the future needs of the country on a sustainable basis.

In other words, a national energy plan needs to be drawn up on a high-priority basis — instead of playing politics on this pivotal issue — to reinvigorate our fledgling industrial sector and boost our growth rate. Only that can extricate us from the economic quagmire we are stuck in at the moment. That plan in the short term must focus on load management, conserving energy, full utilisation of the installed capacity of power generation and checking electricity theft. For the long term solution, greater emphasis must be laid on harnessing and pressing into service indigenous energy generating resources.

Moreover, earnest efforts must be made for building consensus on the abandoned hydro electric power generation projects, completion of Bhasha Dia Mir Dam, Neelum-Jhelum project and also developing new gas wells. It is understood that new gas reserves have been found near Kohat which are estimated to be much bigger than Sui. Work on tapping those reserves must be started promptly. Furthermore, we have infinite coal deposits in Balochistan which can be utilised for power generation, never mind the pollution concerns.

Solar Energy is also an inexhaustible source of energy and can form an integral part of the plan to produce electricity on perennial basis. Wind energy is another area that needs to be tapped. The energy produced through these sources will be much cheaper than the electricity generated with imported furnace oil and gas. This strategy will check the drain of precious foreign exchange that has to be utilised for the import of oil for producing electricity. And, above all, it will also save us from the adverse effects of the global politics and the fallout of the clash of interests between the competing forces in this region.