The government has given green signal to National Engineering Services Pakistan (Nespak) to undertake feasibility study on Iran-Pakistan gas pipeline project, Business Recorder has learnt. This was decided during a meeting held in the Ministry of Petroleum and Natural Resources under the chairmanship of Minister Petroleum Dr Asim Hussian on Saturday.
The Minister gave the go-ahead to undertake the feasibility study of Pakistan's section of the pipeline from the border with Iran to district Nawabshah. The meeting was also attended by Nespak Managing Director, Project Co-Co-ordinator Dr Masud Hashmi and IP gas pipeline Project Manager Yawer S Ansari. Pakistan and Iran had finalised $7.5 billion gas project on June 13, 2010. The pipeline will connect Iran's giant South Fars gas field with Pakistan's Balochistan and Sindh provinces.
Under the gas sale and purchase agreement (GSPA), Pakistan will import about 750 million cubic feet per day (mmcfd) with provision to increase it to one billion cubic feet per day (bcfd). The volume of imported gas will be about 20 percent of Pakistan's current gas production, and the agreement is for a period of 25 years, renewable for another five years.
Ministry officials said that the feasibility study would take one year to complete, while Pakistan's part of pipeline will take another three years to construct. They said that both Pakistan and Iran are committed to completing the project by the end of 2014.
Officials said that both countries have settled almost all issues, including gas price. They said that it was confidential and they were not allowed to disclose it. Pakistan has to construct about 700 km pipeline from the border, passing through Mekran Coastal Highway to connect with its existing gas transmission network at Nawabshah. A 42-inch diameter pipeline is planned to be built, at an estimated cost of $1.65 billion, officials added.
The pipeline will facilitate passage of natural gas from Iran's biggest gas field in South Pars to Pakistan through Balochistan. Sources said that after completion of paperwork last year, Iran has already started to build the 300 km stretch of the pipeline from Iranshahr to Pakistan's border through Iranian port of Chabahar.
The project is crucial for Pakistan to avert the growing energy crisis, already causing severe electricity shortages in the country, and the project would help generate around 5,000 megawatts of electricity, which is equivalent to present peak shortage of power in the country. The energy crisis in Pakistan has resulted in the closure of numerous industrial units across the country, especially in Punjab. Iran has the world's second largest gas reserves after Russia, but sanctions by the western countries including USA, political turmoil and construction delays have slowed its progress to become a leading gas exporter.
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