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Oman-Iran pipeline cost to rise

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World Pipelines,

The need to design a new pipeline route could see a larger budget than first thought for the planned 400 km gas pipeline project. According to Reuters, since the two countries had to change the project's route and adapt designs to avoid waters that are controlled by the UAE, the planned subsea natural gas pipeline that is to run between Iran and Oman is to have a higher estimated cost than first expected.

An unnamed source told Reuters: “We expect slight upward budget adjustment because of this change but we have not finished the deep route survey yet.”

According to ME Construction News: “While the new proposed route will be shorter, it could go deeper – up to 1000 m, double depth of the earlier plan. Capacity may also be raised.”

In 2013, Iran and Oman signed a deal valued at US$60 billion in total. The deal would allow Oman to use Iranian gas for its domestic needs and to export it to global markets as LNG.

Initial plans for the pipeline suggested it would cost between US$1 billion and US$1.5 billion to build. However, due to the above reasons, this is now set to rise.

The pipeline is set to carry 1 billion ft3/d of gas. However, this may raise up to 2 billion ft3/d due to high demand for gas in the region.

Edited from various sources by Anna Nicklin

Sources: Reuters, ME Construction News, Al Arabiya

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