India may participate in Black Sea -Red Sea pipeline project

India is actively examining the possibility of sourcing some of its oil imports through the Mediterranean pipeline, or the Black Sea-Red Sea pipeline project, in a bid to diversify its crude oil supply sources. The project would involve India lifting oil from the Israeli port of Eilat on the Red Sea rather than the Turkish port of Ceyhan on the Turkish Mediterranean coast, which so far is the practise.

Oil travels to Ceyhan from Azerbaijan across Georgia on the Baku-Tblisi-Ceyhan (BTC) pipeline. If the Black Sea–Red Sea project fructifies then the delivery point for Azeri oil would shift from the Turkish port city of Ceyhan to the Israeli port city of Eilat on the Red Sea. This would allow maritime traders to bypass the congested Suez Canal, and also press Very Large Crude Carriers into service.

Indian officials stressed that the project is still at a conceptual stage and that the economic viability of the project was being examined. It was not necessary that the country would commit itself to direct participation in pipeline construction, they said, and very likely the network would be built by Turkey and Israel.

According to official sources, currently two million tonnes, of the 120 million tonnes of crude oil being annually imported by India, is lifted from Ceyhan.

Officials said that the pipeline was a good idea as it had the potential of being a cheaper alternative to beneficiary countries. They stressed that the onus of making the project feasible rested with Turkey and Israel.

According to officials India would only consider the proposal if the landing price at Eilat would be cheaper than what the country was currently being offered from Saudi Arabia, Iran, Iraq and Kuwait.