Gas export deal with Pakistan in the pipeline, says GAIL

India is in talks with Pakistan to export natural gas to that energy-starved country through a pipeline from Punjab, according to state-owned Indian distributor GAIL Ltd.

GAIL has proposed to lay a 110-km pipeline from Jalandhar to Wagah border via Amritsar to supply natural gas to Pakistan, the company's chairman and managing director B C Tripathi told reporters in New Delhi today.

Liquefied natural gas (LNG) will be imported at ports in Gujarat and moved through GAIL's existing pipeline network till Jalandhar. It will then be moved through the proposed new line.

"Pakistan has evinced interest in taking LNG from us to meet its energy demand," Tripathi said. "The export is techno-commercially feasible. We can do that subject to the union government's approval and arriving at a commercial agreement."

Initially, Pakistan wants to take 1-1.5 million tonnes of LNG. "Pricing and other commercial negotiations are going on," he said, refusing to elaborate.

LNG imported to India currently costs $13-14 per million British thermal units, and after including customs or import duty, pipeline transportation charges and local taxes, the delivered price will be close to $21.

Pakistan, which does not have facilities to import gas, has however been stipulating that it is prepared to buy LNG from GAIL only if India exempts it from taxes to bring down the cost.

Tripathi said pipeline exports to Pakistan are viable and should be looked at in the context of India looking at importing gas through a cross-country Turkmenistan-Afghanistan-Pakistan-India pipeline.

(Also see: India's Gail keen on selling scarce natural gas to Pakistan)