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Middle East-India Deep Sea Gas Super Highway
T N R Rao (IAS) is the Chairman Advisory Board, South Asia Gas Enterprise (SAGE), the initiative to build the gas pipeline from Middle East to India. During the early nineties, as the Petroleum Secretary, Rao led various path breaking reforms for the country’s hydrocarbon industry. He co-authored Prime Minister ’s Hydrocarbon Vision 2025. He talks about how the SAGE deepwater pipeline c an be a solution to meet the energy requirements of the country.

Natural gas as a primar y source of energy is ushering in a new era as the world’s oil reserves are depleting against rising demand for energy. Environmental compulsions need cleaner fuels like natural gas. Energy hungry India needs reliable and long term supplies of energy and the Gulf is the natural source for India, both geographically and economically. The Middle East possesses one third of proven reserves of world’s natural gas but accounts for only a fraction of world’s consumption.

Global demand for gas is increasing and the Middle East has realised that gas is a cheaper and cleaner form of energy and a major foreign exchange earner for them. Over 2000TCF of natural gas reserves are held by countries in the Middle East like Qatar, Turkmenistan and Iran with whom India has traditional trade and cultural relationships for long.

SAGE (South Asia Gas Enterprise) is an Indian Private Sector Initiative, working together with a global consortium to create a multi billion dollar natural gas transportation infrastructure linking the Gulf region to India. Leading Oil and Gas Industry deepwater pipeline specialists, sister companies Heerema Marine Contractors (HMC) and INTEC Engineering and Saipem of Italy are partners in the Sage consortium.

All these companies have publicly announced the SAGE pipeline to be technically feasible. Significant technical inputs have also been received from the Cer tifying Agency DnV and pipe manufacturer CORUS. It thus harnesses international finance and world class proven technology to lay the pipeline to India. It takes forward the earlier deep sea project proposal approved by the government of India and envisages a common carrier allowing multiple buyers and multiple sellers to conclude long term gas sale-purchase agreements, resulting in immense fiscal benefits to Indian consumers.

High pressure trunk lines have proved to be the safest and cheapest way of transporting gas to markets for short to medium distances upto 2,500kms, making the proposed SAGE deepwater pipeline the optimal solution for gas supplies to the Indian sub-continent. Linking the Middle East gas fields with India across the Arabian Sea for an offshore distance of 1300kms, the SAGE gas transmission pipeline system is designed to transpor t upto 1.1 BCFD of gas through each pipeline into the Indian gas markets. The deepwater route across the Arabian sea is the shortest secure distance between these huge reserves and the rapidly developing industrial heartland of western India and is too short for LNG to be an economic proposition.

India recognised the above and concluded in the early nineties agreements for a deep sea pipeline from Oman and another land/shallow water one from Iran (IPI) as well as from Turkmenistan through Afghanistan and Pakistan to India (TAPI). The IPI pipeline, despite years of discussion has not made much progress. The TAPI also is moving forward slowly. Security of supply issues have become of increasing concern worldwide, when pipelines pass through third country territories. Deep sea pipe lines obviate the need to pass through insecure and hostile regions of our neighbourhood threatening energy security.

The deep sea route is also outside the straits of Hormuz, another bottleneck in any event of disturbed peace in the Middle East. The deep sea routes thus will veer round political rivalries and economic interests. Such deep sea pipelines from CIS sources are now common in Europe to enable them to break loose from the Russian grip on gas supplies.

Supply of gas from the Middle East to India via the deep sea route by comparison is far less exposed to risks of interruption.

In addition, an alternative supply route to Indian market in addition to IPI and TAPI pipelines will also add competition and remove the potential risk of single supply source through an overland route. The deepwater route also provides the easiest option for an eventual expansion in to a family of pipelines in the future and thus establish a secure energy corridor to India.

Technically, the progress made so far the world over in laying and operating deeper and deeper pipelines means that the water depths expected for SAGE pipeline are no longer a giant leap forward but rather the logical next step. Over the past 15 years, the techniques of deep water pipelay and line pipe manufacturing have matured as the Oil & Gas industry has accumulated substantial experience of working in very deep waters. Quantified Risk Assessment shows this very deep water environment to be benign and protective for the system The fabrication and commissioning of deepwater pipelay barges capable of installing pipelines at ocean depths 4000 feet and more mean that the industry will be ready with necessary tools for the SAGE pipeline. Studies done over the last few years have proven the feasibility of the SAGE project to be designed in accordance with the accepted deepwater codes worldwide, combined with prevalent construction technologies.

SAGE is also developing and readying identified pipe mills to modify and install processes to design and fabricate pipes to achieve pipesize/wall thickness combinations for these depths. Preliminary routes are being optimised with options for mid-sea compression and route deviations to avoid the worst features of the seabed. In-depth baseline studies and proven environmental principles will be adopted to ensure environment friendly project implementation.

Economically and commercially, SAGE pipeline provides the most economic method of gas supply to India and enhances the security of energy supply for the country. Unlike the current onshore projects such as IPI and TAPI, the SAGE pipeline provides a safe and economic route and promotes competition in the Indian energy markets.

SAGE project will ensure minimum transport costs and eliminates the need for transit fees as in other land route pipelines. Being built on a common carrier principle, actual users of this imported gas will derive large tax benefits.

SAGE thus proposes to deliver the most competitive source of energy for long periods of 25 to 30 years, thus contributing to green field investments and sustainable development of the Indian economy.