The over $ 7 billion Iran - Pakistan - India gas pipeline project has been found to be technically feasible but its economic viability will depend on the price at which Tehran sells the fuel, the Centre said on Tuesday.
"Indian side had appointed Ernst and Young as the financial consultant and ILF, UK as the technical consultant for preparation of the pre-feasibility report of Iran - Pakistan - India pipeline project.
"The project has been found to be feasible," Minister of State for Petroleum and Natural Gas Dinsha Patel said in a written reply in Rajya Sabha.
The three nations are aiming at signing a framework agreement on the project by the end of next month.
"The price of gas against the alternate fuel prices will determine the economic viability of the pipeline project," he said.
Iran has given a formula for determining gas price at the Iran-Pakistan border. New Delhi is also discussing transportation tariff and transit fee to be paid to Pakistan for passage of the pipeline from its territory.
"Once these issues are decided, the price of gas at Pakistan-India border would be known and then a decision on the purchase of gas through Iran - Pakistan - India pipeline project will be taken," he said.
{{/usCountry}}"Once these issues are decided, the price of gas at Pakistan-India border would be known and then a decision on the purchase of gas through Iran - Pakistan - India pipeline project will be taken," he said.
{{/usCountry}}While Patel did not say what price Iran was quoting, officials said Tehran wants to sell natural gas to India and Pakistan at 4.93 dollars per million British thermal unit (60 dollars per barrel crude oil price). Transportation tariff and transit fee are added to this price.