I P-project I n the light of project management:-

Project Objective & Business Value:-

The business case is a document that describes the crucial information to determine whether or
not the project is worth the necessary outlay and the results to be delivered by the project. It is
commonly used for decision making by the relevant stakeholders above the project level.
Typically it contains the cost-benefit analysis to give explanation for and establish boundaries
for the project, and such investigation is usually accomplished by a analyst using various
stakeholder inputs. Some of the Socio-Economic Benefits of IP-project are:
Import of natural gas is one of the cheapest and most appropriate fuels for power
generation.
The project will have a capacity of generating about 4,000 MW power, which will help in
overcoming the severe power shortage emergency.
Project would help in obliterating old rivalries and would bring peace to the area and thus
has been termed as the peace pipeline.
Pakistan would also get supplementary income due to gas transit.
The undertaking of pipeline project will also generate job opportunities in rural areas of
Balochistan.
The project shall help a great arrangement in meeting the energy necessities of the
countrys economic growth.
Stress was made on valuable measures for accomplishment of trilateral and multilateral
deals on trade and transportation of goods between and through these countries.
The first gas flow shall be accessible by the end of 2014, as planned.
Iran-Pakistan Gas Pipeline between Iran and energy short Pakistan is a reasonable and physically
possible project. But since the very beginning in 1995 when a groundwork agreement or the
memorandums of understanding (MOUs) was signed that define initial intentions for a project
under which, The three countries affirmed their deep assurance to make every attempt to
eradicate radicalism, militancy and violence from the region. The three countries will also join
forces closely in establishing and mounting energy corridors in the region, including oil and gas
pipelines and electricity networks. But since the MOU, IP-project (Iran Pakistan Project) has
been lingering and is being delayed. Under the preliminary contract, Pakistan has to lay down the
781-kilometre pipeline from Pak-Iran border to Nawabshah to meet up the time limit of
December 2014, but in actual there has been no activity on ground for laying down the
infrastructure for the peace pipeline and continuous change of stance on various aspects of
project by the three governments.

One of the starting causes of lag in project initiation was the changes in scope of project, as the
project initially was planned to deliver natural gas from Iran to Pakistan to supply the natural
gas. But afterward Iran invited India and made an offer to extend the pipeline from Pakistan into
India in February 1999, and after a series of negotiations a preliminary agreement was signed
with Indian government. But this was not the end, In April 2008; Iran expressed interest in the
Chinas participation in the project, after India withdrew from the project due to some security
issues. Stakeholder recognition is a continuous process throughout the project life cycle.
Identifying stakeholders, considering their degree of persuasion and importance on a project, and
harmonizing their desires and expectations are serious to the achievement of the project. But
because of the ongoing changes in the stance by the involved parties and delayed negotiations
over the IranPakistanIndia (IPI) gas pipeline project for a long time and project was stuck in
its planning stages after the first preliminary agreement, which lead to delays, cost increases,
unforeseen issues, and other unconstructive consequences including project termination. This has
been one of the basic reasons for the delay in development and project charter which was finally
signed in may 2009 after fourteen years of severe negotiations.
Another reason for the ongoing delay especially of the Pakistans part of 1000 KM of pipe line
is non availability of Financial Resources and Budget as a report published by Pakistan's
ministry of finance clearly stated that private investors, financial institutions and oil and gas
companies were showing least interest in making investment in IP project, and as at the time of
initiation government did not had any contingency plan or fund in place for such future
situations, the government is force to impress a tax on consumers, or search for government-to-
government preparations for getting funds from Iran and China for project completion, but even
these countries who had initially pledged support for the project, are concerned about the
implications of the US sanctions against Iran, and have backed off. Thus the supply of gas under
the IP project seems a non-starter, and in case Pakistan does not fulfill its part of contract till the
deadline, it will have to pay to Iran a fine of almost $200 million a month as a consequence.
However Pakistan has requested to bond the achievement of the project completion with the
removal of the US and EU sanctions according to which Iran will not to call upon the penalty
that would be in place after the deadline. Once the sanctions are removed, Pakistan will complete
its obligation in 18 months.
Another fundamental reason for the continuous delay and updates in Project timeline and
schedule are environmental factors which include regulatory sanctions/opposition such as the
ones imposed by EU and U.S. government, and other security reasons in balochistan. Although
Pakistan is assumed to have well-versed the U.S. government that it was unlikely for it to discard
the project because of its imperative energy requirements, and signed an agreement for the
pipeline. As initially the Project was planned to be sponsored on Public Private Partnership
basis, however Pakistans government has stated that it is not capable of generating the required
$180 million funding to materialize the project because of the US and EU sanctions on Iran.
After removal of international sanctions the project can be completed in 22 months time, but the
government cannot take it any further unless sanctions against Iran have been lifted because of
which Pakistan has been persuading Iran to review the timelineof the project.
As the project I mplementation was decided to be on a segmented approach whereby each
country shall be liable for construction of pipeline in the relevant region. For this purpose The
Engineering & Project Management consultant were appointed in 2011 to have a detailed survey
and provide a feasibility report for project. The E&PM consultant completed the financial
Feasibility Study, Interim Front End Engineering Design and Route exploration survey, and
submitted the final reports on Survey which is under review. Presently the Iranian side of the
$7.5-billion project is almost complete, but on Pakistans side there has not been any on ground
activity for laying down the infrastructure because besides the lack of interest by the
multinational companies, Political & financial conditions in Pakistan and other security reasons
also do not allow the government to pump funds for this huge project, causing delays in
construction of the pipeline its possible that the Iranian government goes for a new venture
under which it would provide the gas to India under IOI gas pipe line agreement.
http://www.thenews.com.pk/Todays-News-13-29620-Iran-almost-abandons-IP-gas-pipeline-
project
http://ipripak.org/factfiles/ff124.pdf
http://www.brecorder.com/brief-recordings/0/1204543/
http://www.dawn.com/news/1089402
http://www.issi.org.pk/publication-files/1361514533_90594538.pdf
http://www.isgs.pk/projects/iran-pakistan-gas-pipeline-ip-3
http://pu.edu.pk/images/journal/pols/pdf-files/Iran%20-%20Pakistan%20gas%20%20-
%20Munir_VOLUME20_2_13.pdf
http://www.platts.com/latest-news/natural-gas/karachi/pakistan-seeks-to-shelve-iran-pakistan-
gas-pipeline-26685207
http://tribune.com.pk/story/646441/gas-pipeline-iranian-firm-offers-to-finance-pakistans-side/