SOUTH ASIA GAS ENTERPRISE (SAGE)

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Context

• South Asia Gas Enterprise (SAGE), an international consortium of companies in deepwater pipeline projects, has sought the support of ministry of petroleum and others to develop an undersea gas pipeline from Gulf to India. 

About the project

• The proposed 2,000-km-long energy corridor connecting Middle East and India, a $5 billion project, can lead to an annual saving of about INR 7,000 crore in comparison with similar quantity of liquefied natural gas import.

Details

Background

• The undersea transnational gas pipeline project Middle East-India Deepwater Pipeline (MEIDP) was initially conceived between Iran and India (Porbandar) about a decade ago but failed to take off due to western sanctions.
• There have been new large gas discoveries in Oman, UAE and Saudi Arabia recently and the Middle East plans to spend over $120 billion to increase gas output by 14 billion cubic feet per day (bcfd) by 2030.

Route

• The route being looked at is via Oman and UAE through Arabian Sea to avoid geo-politically sensitive regions.

Significance

• It will allow options to import gas from Oman, UAE, Saudi Arabia, Iran, Turkmenistan and Qatar, a region with 2,500 trillion cubic feet (tcf) gas reserves.
• Meeting needs of power and fertiliser industry for affordably priced gas, while moving to a low carbon economy, and increasing gas share to 15% in energy basket will create a demand of 700 mmscmd gas annually at right prices.
• Gas pipelines are more competitive than LNG up to a distance of 2,500-3,000 km due to high cost of gas liquefaction, transportation and regasification. It can save $5 to $6 per mmBtu.
• The proposed pipeline promises to deliver 31 mmscmd gas to India under a 20 year long term supply contract

About SAGE

• SAGE is promoted by the New Delhi based Siddho Mal Group, in Joint Venture with a UK-based Deepwater Technology Company.
• SAGE is working with a Global Consortium of some of the most reputed companies in the field of Deepwater Pipelines, to create a Multi-Billion Dollar "Energy Corridor"that can transport gas from the Middle East to India, bypassing the land route through Pakistan.
• In addition, SAGE also plans to supply Natural Gas to Oman/ UAE on its Pipeline Route to India, and seeks to further build Cooperative Relations with the friendly Gulf and Middle East countries.
• SAGE pipelines are envisaged as "Common Carriers"which Gas sellers in the Gulf can use as infrastructure to transport gas to the Indian region, by payment of a Pipeline Tariff.
• SAGE Deepwater Pipeline is completely independent of the Indian Government’s Onshore Pipeline Initiatives and builds extensively on studies performed for the Oman- India Pipeline during the mid 1990’s.

DEEP-SEA PIPELINE ROUTE The Deep-Sea Pipeline Route is now technically possible and commercially viable. Contrary to popular belief, Deepwater Pipelines are at times, more economical than Onshore pipelines that pass through land, since no Transit Fee has to be paid to countries on the way. In addition, it can be laid faster than onshore pipelines passing through several countries.

PRACTICE QUESTION Q) The Deep-Sea Pipeline Route will not help India in meeting the needs of the power and fertiliser industry but also help in moving to a low-carbon economy. Examine. (250 words)

https://www.financialexpress.com/industry/5-billion-undersea-uae-gujarat-gas-pipeline-proposed/3089046/