ISLAMABAD, March 15: The $3.5 billion plan for importing natural gas from Qatar through a 1,830-kilometre-long pipeline has been put on hold because of “non-availability of required gas quantities”.

“It is not on the forefront,” said Secretary Petroleum Ahmed Waqar, adding: “We are concentrating on IPI (Iran-Pakistan-India pipeline project) at the moment.”

The sources said that India had not yet taken a decision whether to join the IPI project at a delivered price of $4.25 per MMBTU (million British thermal unit) on its border. They said Pakistan had agreed with Iran on gas pricing formula based on Japanese crude oil that roughly translated into less than $3.85 per MMBTU. It involved indexation at $10 change in Japanese crude price with a crude price band of $30-70 per barrel. Mr Waqar declined to comment about the formula.

Sources in the petroleum ministry, however, told Dawn that the project sponsors – Crescent Petroleum of Sharjah – had informed the government of Pakistan that gas quantities required for the project were not available in Qatar in the next 8-10 years. They said Qatar had long-term commitments for liquefied natural gas (LNG) exports and could not spare enough volumes for a pipeline project.

Pakistan, the sources said, had asked Qatar to enhance gas availability for the project up to 2.6 billion cubic feet of gas per day (BCFD) but it was not ready to go beyond 1.6 BCFD. A gas sales and purchase agreement (GSPA) has been under consideration of Pakistan government for the past few years but it could not be signed.

The gas import plan from Qatar was originally floated by the Sharjah-based Crescent in 1999 but talks failed in 1995 over gas tariff between the two nations and the project could not take off. The project re-emerged and in 2000 Crescent Petroleum signed a fresh heads of agreement for exclusive rights with Qatar government to export of gas to Pakistan.

It did not get top priority in Pakistan because of its relatively higher cost and technical complexities because of its deep sea route when compared with its competing import pipeline options from Iran and Turkmenistan.

Mr Waqar said that Pakistan was still in the process of in-house consultations on the question of transit fee to be charged from India to let the gas pipeline pass through over 650-km territory in Pakistan.

Another official said a separate idea floated by Iran a few years ago of common user gas highway to dovetail Qatar’s gas with Iranian for transportation to Pakistan and India had also been shelved.

Pakistan’s current gas shortfalls hover around 300-350 mmcfd (million cubic feet of gas per day) and are likely go up to 778 MMCFD by 2009-10 and rising to more than 11,000 MMCFD by 2025 because of rising needs and slowing down supplies at home coupled with no discoveries expected to be on line in the short-run.