The Pipeline India Has Been Dreaming of Since 1993.
NEW DELHI: On May 14, 2026, India’s Ministry of Petroleum and Natural Gas directed three state-run enterprises GAIL India, Engineers India Limited and Indian Oil Corporation to prepare a Detailed Feasibility Report for a ₹40,000 crore deepwater gas pipeline running from the coast of Oman directly to Porbandar in Gujarat. The pipeline would stretch 2,000 kilometres across the Arabian Sea. It would bypass the Strait of Hormuz entirely. It would be the deepest submarine gas pipeline ever built.
India has wanted this pipeline for thirty-three years. The question worth asking is not what the pipeline would do. The question is what has changed in 2026 that makes this revival different from every previous attempt and whether the engineering, the financing and the geopolitical alignment are actually in place this time.
What the Hormuz Crisis Actually Cost India
The immediate trigger is specific and severe. On February 28, 2026, coordinated US and Israeli strikes on Iranian military sites prompted Tehran to formally close the Strait of Hormuz on March 4. The closure was executed through naval mine-laying, ship seizures and swarm-boat deployments. India routes nearly two-thirds of its LNG imports and 90 percent of its LPG consumption through that strait. The consequences arrived almost immediately.
Asian spot LNG prices surged from a baseline of 10 to 12 per MMBtu to peaks of 24 to 25 per MMBtu. Indian-flagged vessels came under direct attack. The tanker Skylight was struck north of Khasab in Oman on March 1, killing two Indian crew members. The cargo vessel MKD VYOM was hit by an uncrewed drone boat, forcing evacuation of its 21-person crew. By March 25, India had deployed five frontline warships under Operation Urja Suraksha to escort over 20 Indian-flagged vessels west of Hormuz.
The financial damage was equally stark. Between mid-March and end of April, state-owned oil marketing companies posted ₹62,500 crore in under-recoveries. Daily losses for the IOCL-BPCL-HPCL triad reached ₹1,600 to ₹1,700 crore. Projected LPG under-recoveries for FY27 threatened to cross ₹80,000 crore. No previous revival attempt for this pipeline had this kind of fiscal evidence behind it. That is what has changed.
Three Decades of Broken Starts
The project’s history is long enough to generate scepticism on its own. India and Oman signed a bilateral MoU for an undersea pipeline as far back as June 1993. A consortium including Engineers India Limited, Bechtel, Saipem and McDermott completed a feasibility study that year and agreed on principal terms by September 1994. The project then stalled on three fronts simultaneously.
Pakistan blocked the initial shallow-water routing across its continental shelf and pushed instead for an overland alternative. India refused any route that placed its primary energy import artery under transit-state control. Oman meanwhile found a faster path to market by establishing Oman LNG in 1994 and commissioning its Sur and Qalhat export terminals by 2000. And the engineering simply did not exist yet in the 1990s, no contractor on earth could lay large-diameter high-pressure steel pipes at depths exceeding 3,000 metres.
The project resurfaced in 2001 and again in 2014 when the JCPOA briefly made an Iran-origin variant look viable. A private consortium called South Asia Gas Enterprise proposed a 4.5 to 5 billion subsea pipeline delivering Iranian gas to Gujarat via the Oman Sea. US sanctions reimposed after 2018 ended that conversation. In 2023, SAGE re-approached India’s Petroleum Ministry seeking diplomatic support. Each time the pipeline returned to the table. Each time something intervened.
The Engineering Frontier This Project Sits At
This revival is different in one concrete technical respect. SAGE had previously conducted marine reconnaissance surveys along the proposed route and laid approximately 3,000 metres of test pipeline at a depth of 3,000 metres. That pre-feasibility work received technical validation from DNV. The state-run consortium now tasked with the Detailed Feasibility Report can incorporate that existing seabed data and bypass basic exploration to move directly to Front-End Engineering Design.
The engineering challenge however remains formidable. The pipeline must cross the Murray Ridge at depths reaching 3,450 metres deeper than any operational subsea gas pipeline in the world today. Shell’s Stones lateral pipeline in the Gulf of Mexico holds the current record at 2,900 metres. The Owen Fracture Zone along the route is an active tectonic boundary. The Indus Fan presents deepwater sedimentary channels prone to turbidity currents and underwater landslides. At 3,450 metres, external hydrostatic pressure exceeds 340 bar. Standard diving is impossible. Every inspection and repair requires remotely operated vehicles deployed from specialist vessels.
A realistic construction timeline for a project of this depth and distance is five to seven years from financial close not from the feasibility study order issued last month.
The Economics That Make the Case
The financial argument for the pipeline is the strongest it has ever been. A full LNG import chain liquefaction, cryogenic shipping, customs duty, regasification at Dahej or Hazira, domestic trunk pipeline tariff delivers gas to an Indian industrial user at approximately $11.62 per MMBtu under normal market conditions. The projected delivered cost through the subsea pipeline is $7.92 per MMBtu. At the pipeline’s design capacity of 31 MMSCMD, that cost differential translates to annual savings of approximately $1 billion for India’s industrial consumers.
The sectors that benefit most are among the most strategically sensitive. India’s fertiliser industry requires 46 to 50 MMSCMD of gas and can only operate viably when fuel costs stay near or below $6 per MMBtu. Approximately 15,000 megawatts of gas-based power generation capacity sits stranded because spot LNG at current prices makes it uncompetitive. A pipeline delivering gas under long-term take-or-pay contracts at a stable tariff changes the operating economics for both sectors fundamentally.
SBI Capital Markets has previously calculated a levelised pipeline tariff of $1.86 per MMBtu based on a 12 percent post tax IRR $4.5 billion in capital expenditure and a 50-year operational life. The financing structure most analysts consider viable combines PSU equity from GAIL and IOCL with long-term debt from multilateral lenders such as the Asian Infrastructure Investment Bank or the New Development Bank, backed by sovereign guarantees from both governments.
Oman Is a Hub, Not Just a Supplier
One structural concern about previous proposals was Oman’s limited gas reserves. At approximately 23 to 25 trillion cubic feet of proven reserves, Oman alone cannot sustain the volumes needed to justify this capital expenditure over a 50-year pipeline life. The current design addresses this directly. The pipeline is conceived as a multi-supplier corridor. The gathering system on the Omani coast is positioned to aggregate gas from Qatar’s North Field, UAE pipeline networks and potentially Iran’s South Pars field via a separate Iran-Oman subsea link already under development. The Gulf collectively holds over 2,500 trillion cubic feet of reserves. The pipeline to India is designed to tap that wider pool.
India-Oman bilateral ties provide a stable diplomatic foundation for this ambition. The two countries share joint ventures in the Oman-India Fertiliser Company at Sur and the Bharat-Oman Refinery at Bina. Regular joint naval exercises under the Naseem al-Bahr framework reflect a security relationship that goes well beyond trade.
What Still Has to Happen
The Detailed Feasibility Report ordered in May 2026 is the beginning of a process, not a construction decision. For the project to move forward, India and Oman need a formal government-to-government agreement that defines gas allocation priority under emergency conditions, third-party access rights for other Gulf producers and transit tariff structures. Financing must be committed. Long-term take-or-pay supply contracts must be signed before any lender will commit capital at this scale.
China’s energy infrastructure offers an instructive contrast. Its Power of Siberia pipeline carries 38 billion cubic metres per year. Its Central Asian network adds another 55 billion. When the Hormuz crisis hit in 2026, China’s exposure was materially lower than India’s because it had spent two decades building overland pipeline alternatives. India’s strategic gas storage stands at 10 to 12 days of national demand. China is targeting 80 billion cubic metres of storage capacity by end-2026.
The 2026 crisis has given this pipeline more genuine political momentum than any previous revival. The engineering foundation is more advanced than it was in 1993. The economic case is stronger than it has ever been. However, India has been at this starting line before. Whether it crosses the finish line this time will depend on decisions made in the next 18 months not on the urgency of the crisis that prompted them.
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