Iran seeks war cover for IPI gas project

Mumbai: Iran has sought legal cover for gas sale to Pakistan and India through the India-Pakistan-Iran gas pipeline project by an amendment to the gas sale agreement and fortify its position in the event of disruption of fuel supplies due to any armed conflict.

Iran now wants to replace the term ''act of war" under ''excusing event'' with a suitable substitute like ''situation of armed conflicts or war'' in the draft agreement for the project, the Daily Times quoted Pakistani officials as saying.

The latest amendment, apparently to seek a force majeure clause in case the seller country, Iran, is faced with an armed conflict or war, would require further negotiations.

This will further delay the IPI project, which has already been delayed by the many amendments proposed by Iran and India.

The proposed 2,670-km pipeline project includes about 1,115 km in Iran, 705 km in Pakistan and 850 km in India.

Pakistan, sources said, is likely to consider the issue as it involves its own interests  and has sought legal opinion on the issue.

A sub-committee of Pakistan's economic coordination committee on gas import projects has also backed the proposal.

Pakistan and Iran had already agreed in principle on a gas price formula on 23 October 2007 and are expected to sign an agreement on the $7.4 billion project in the next two months.