Pakistan, Iran to jointly develop gas pipeline implementation plan

Workers can be seen working on a gas pipeline in Chah Bahar, Iran.  - x/@dana916
Workers can be seen working on a gas pipeline in Chah Bahar, Iran. – x/@dana916
  • Pakistan reiterates its commitment to the project: Minister.
  • Iran offered to export more power to Gwadar, Chaman.
  • Both countries decided to explore ways to implement the project.

ISLAMABAD: In a positive development, Pakistan and Iran have decided to jointly develop a consensus implementation plan for the Iran-Pakistan (IP) gas pipeline. news Information was given on Friday.

The decision came after a meeting between the two sides in Tehran, during which Islamabad had sought an exemption to the February-March 2024 deadline to avoid paying an $18 billion fine for not laying the pipeline in its territory.

Last year, Iran had asked Pakistan to build a part of the gas line project on its territory by February-March 2024 or pay a fine of $18 billion.

Talks regarding the plan will begin in the next two to three weeks.

Nevertheless, the Iranian deadline to move to international arbitration by September 2024 will allow so much time to explore bilateral avenues.

Energy Minister Mohammad Ali told news“We have had constructive talks in Tehran and Pakistan has renewed its commitment to the project.

“We have reassured the neighboring country about its inadequate energy situation, for which we have also increased work on the TAPI gas line project. The Iranian side listened to us carefully and agreed to enhance active participation to enable the IP project expressed.”

During the talks, the Iranian side also offered to export more power to Pakistan for Gwadar and Chaman and Iran agreed to consider it. Pakistan is already importing 104MW of electricity from Iran.

Ali said that in his view Pakistan needed more power from Iran for Gwadar, of course at a better negotiated tariff. Although China is setting up a 300MW imported coal-based power plant in Gwadar, it may not meet future needs.

“Once the national grid is established in Gwadar, Pakistan can use more Iranian electricity for its national use,” the minister said.

When the Energy Minister was asked about the issue of the gas project and the $18 billion fine, he said that both the countries have decided to explore ways to implement the project.

Pakistan’s Inter-State Gas System and National Iranian Gas Company signed an amended agreement in September 2019 for the pipeline.

The agreement stipulated that Iran would not approach any international court for any delay until 2024, but would be free to do so thereafter. Pakistan could not build the pipeline primarily because of the risk of US sanctions that any project with Iran could invite.

During the talks, the Iranian side was of the view that there could be no US sanctions as it was already exporting gas to Azerbaijan and Turkmenistan, which are not subject to any sanctions. In that scenario, the same thing would be good for Pakistan.

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