The race for gas in Asia

As discussed before, part of India's dilemma in deciding how to vote in the IAEA on the issue of Iran's nuclear program was its relationship with Iran, and the proposed Iran-Pakistan-India gas pipeline.

India is looking to secure supplies of gas, and the India pipeline is not the only option. From the Asia Times:

Following the decision by Myanmar to supply gas to China, India is now making swift maneuvers to ensure that the US$1 billion Myanmar-Bangladesh-India (MBI) gas pipeline materializes. And significantly, India has virtually decided to join the US-backed Turkmenistan-Afghanistan-Pakistan (TAP) pipeline, in part because of the geopolitical difficulties involved in the $7 billion Iran-Pakistan-India (IPI) pipeline that Washington opposes.

Paradoxically, New Delhi has found an uncommon ally in Islamabad, which is pushing for India's involvement in the TAP as well as the IPI.

India did vote against Iran in the IAEA meeting, and in doing so India may have cast its lot.

While India, Pakistan and Iran go through the motions of pursuing the IPI project, apparently unaffected by the International Atomic Energy Agency's referral of Tehran to the UN Security Council, most observers claim that the prospects of the pipeline materializing are now remote. Despite domestic political pressures, India has so far sided with Western powers against Tehran pursuing an independent nuclear program.

In this context, India was an observer at the recent TAP meeting in the Turkmen capital Ashgabat. Dinsha Patel, minister of state for petroleum and natural gas, led the Indian delegation and expressed willingness to join the TAP. A memorandum of understanding (MoU) was signed at the conclusion of the two-day meeting, under which Turkmenistan will supply 3.2 billion cubic feet gas per day to Pakistan for a period of 30 years.

China is not sitting idly by, either, hence India's need to move to secure a reliable supply.

Irked by the delays in implementing the Myanmar-Bangladesh-India pipeline, Myanmar recently inked an MoU with PetroChina to supply 6.5 trillion cubic feet (tcf) of gas from Block A of the Shwe gasfields in the Bay of Bengal for over 30 years.

The decision came as a major blow to India's bid to tap gas from its eastern front. It also marked one more victory for Beijing energy giants, which have consistently been beating Indian energy firms in the acquisition of oil and gas reserves around the world. India's state-owned oil giant Oil and Natural Gas Corp (ONGC) has lost to Chinese companies, in Kazakhstan, Ecuador and Angola.

Now, with Block A-1 gas going to China, the cost of the MBI will increase as the available block close to Bangladesh is A-2, which will require an additional 150km of pipeline for the gas to reach India.

It is a sign of our times, that China and India are making strategic moves and counter moves as far away as Ecuador.

Certainly, any discussion of gas on the Asian continent will soon involve Russia. The deal to end the squabble between Ukraine and Russia at the beginning of the year, and restore Ukraine's gas supply mentioned Turkmenistan.

Turkmenistan will supply some of the gas to Ukraine under the deal. But, Russia controls the only pipeline between Turkmenistan and Ukraine. In additin, Gazprom has been making deals for Turkmenistan.

India would take care to see that Russia doesn't swallow up the supply in Turkmenistan.