All major political parties of the country including Pakistan Muslim League (PML-N), Pakistan Tehrik-e-Insaf (PTI) and Pakistan Peoples Party are in favour of the Iran-Pakistan (IP) gas pipeline project. Talking to Business Recorder here on Tuesday PML-N senior leader Pervaiz Rasheed and PTI senior leader Shafqat Mehmood stated that the project was vital to deal with the serious energy crisis in the country and their parties were supportive of that project.
Official sources responsible for the construction of IP also told Business Recorder that Indian government was once again showing an interest in joining the IP pipeline project. Pakistan and Iran on March 11, 2013 - five days before the constitutional end of the term of the PPP led coalition government - inaugurated the IP gas pipeline project.
The total length of IP project, if India does join the project, would be 2,500 kilometres of which 1,100 kilometres is in Iran, about 800 km in Pakistan and in case of agreement with India 600 km in Indian territory. This project is expected to greatly benefit India and Pakistan, which do not have sufficient natural gas to meet their rapidly increasing domestic demand for energy.
The $1.5 billion IP project has been lingering since 1995, when Iran-Pakistan signed a memorandum of understating (MoU) to lay the pipeline. Under the accord, signed in June 2010, Iran will provide about 750 million cubic feet per day (mmcfd) of gas to Pakistan for 25 years. The deal can be extended by five years and volumes may rise to one billion cubic feet per day (BCFD). An official working on the project said, "We have not received any negative signal from the PML-N leadership on the project but work on it is suspended. We are waiting for the directions of the authorities concerned, while on Iranian side work is in progress. We firmly believe that the new elected government will go ahead with the project once it takes over the charge of the state affairs. The completion of IP is a must for catering to the energy needs of the country in the long run. Our current local gas reservoirs are depleting at the rate of 10 percent per annum and are expected to be fully utilised within the next 17 years," the official maintained.
Reliable sources in the Ministry of Petroleum, while quoting the penalty clause of the agreement of the IP project, said both Pakistan and Iran were bound to complete the project by the end of 2014; if any country delays due to any reason initially it will have to pay a daily penalty of one million dollar extendable to three million dollars per day. According to officials, "both India and Pakistan have not yet decided on the transit fee. Pakistan could earn about $400-$500 million annually in transit fees from the pipeline and would be able to purchase natural gas from the pipeline". An official of National Engineering Services Pakistan (Nespak) said "Nespak has designed the pipeline corridor that would enable laying an extra pipeline for any other country showing an interest in becoming a partner.