Leading Russian gas exploration Company Gazprom has informed Pakistan that it is ready to build and develop Iran-Pakistan Gas Pipeline (IP) project if Pakistan government exempts it from bidding process and Public Procurement Regulatory Authority (PPRA) rules, it is learnt. A senior official of the Petroleum Ministry told Business Recorder on Tuesday that Iran has also offered to lay gas pipeline in Pakistan in case no foreign company takes up the construction job.
The official added that Gazprom has already submitted Expression of Interest (EoI) in response to Inter State Gas Company's invitation in August last year. The official said, "During a recent meeting of co-ordination Committee of IP, Iran has also offered Pakistan that its gas companies are ready to lay gas pipeline in case no global company is going to construct it, as Iran has also offered Pakistan $500 million in this regard." The official stated that during the meeting both sides discussed technical issues related to the gas pipeline. National Engineering Services Pakistan (Nespak) has completed the design and route study of the project, which would be handed over to the Petroleum Ministry in September, the official added.
According to another senior official of the ministry who is also privy to these developments informed Business Recorder that the work on gas pipeline would start by the end of this year. Pakistan will import 750 million cubic feet of gas daily for 25 years from Iran, according to the terms of the agreement. The pipeline will facilitate transfer of natural gas from Iran's biggest gas field in South Pars to Pakistan through the south-western Balochistan.
Sources said due to high cost of Iranian gas it will not be available for domestic consumers. Most of its supply will go to the industrial sector especially in power generation. The company has also shown keen interest in developing Pakistan's energy sector and will help build power generating facilities and develop gas fields.
Pakistan currently is facing severe gas and power shortage, while the government is managing the crises through gas and power load management plans as well as increasing the prices of utilities. Currently the government has declared two and half day per week suspension in supply of Compressed Natural Gas (CNG) in Punjab and two days in Sindh.
The US has always publicly opposed the Iran gas pipeline, which, according to analysts, had been one of the main reasons for the project delay. Experts and government officials insist early completion of the crucial project would effectively deal with the existing energy shortage. The project would help generate around 4,500 megawatts of electricity, which is equivalent to peak load-shedding in Pakistan, according to experts.
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