$60bn Oman-Iran gas pipeline project may become a reality

Muscat: Oman and Iran have agreed to revive the construction of a $60 billion gas pipeline between the two countries following the visit of Iranian President Dr. Ebrahim Raisi. The  project was on hold for nearly ten years.

Iran’s news agency said last Saturday that Tehran has agreed to push forward the project and revive it as part of discussions during the Iranian president’s visit to Oman.

The deal for the undersea pipeline project was first signed in 2013. It would carry gas from Iran to the Musandam province of Oman.

The agreement to revive the project was reached during the trip to Oman by Iranian Oil Minister Javad Owji before this week’s visit of Iran’s president. The deal was put on hold over price disagreements. When the US withdrew from the 2015 nuclear plan, the project suffered another delay.

Experts say the revival of the gas project is timely as European countries are faced with supply problems from Russia in the aftermath of the Ukrainian invasion.

“If both countries revive the gas pipeline project, many European countries will heave a sigh of relief as they will find an alternative gas source which will reduce their dependency on Russian supply,” Said Al-Hooti, a Supply and Logistics expert, told Times of Oman.

Russia’s Vladimir Putin is insisting on being paid in rouble for the Russian gas supplied to customers and not in  US dollar or Euro as earlier. Most European countries have refused to bow to the demand and are looking for alternative gas supply.

Economic experts say that the prospective resumption of the pipeline would bring a financial windfall to Oman. “It would create new revenues for Oman as the Sultanate would have the right to market Iranian gas to suppliers all over the world. It will also generate a lot of jobs for young graduates in logistics, supply chain, safety and many other vacancies in administration and even accounts and finance,” Hamood Al Saifi, a retired economist at the Economy Ministry, said.

Oman News Agency said a series of agreements between the two countries were signed during the one-day visit of the Iranian president. The agreements cover maritime, logistics, agriculture, fisheries, industries, education and construction.

“The pipeline is now a reality and we are pursuing all avenues to make it happen since there is a real commitment from both sides,” an official from the ministry of economy, told Times of Oman.