Pakistan asks Iran to finance IP gas pipeline project

[Falon]

Mod Edit

Pakistan asks Iran to finance IP gas pipeline project - DAWN.COM




ISLAMABAD: Pakistan has asked Iran for $2 billion in financing to build its side of a controversial Iran-Pakistan (IP) gas pipeline that has drawn threats of US sanctions, Islamabad's petroleum minister said Tuesday.

The Iranian side of the $7.5-billion project is almost complete, but Pakistan has run into repeated problems paying for the 780 kilometre (485 mile) section to be built on its side of the border.

Pakistani petroleum minister Shahid Khaqan Abbasi told AFP on Tuesday that the preparatory work was complete, but they had asked Iran to provide $2 billion for the construction work.

“All these issues will be discussed in a meeting which we have requested, but so far there is no reply from the Iranian side,” Abbasi said.

“They were busy in cabinet formation and I hope that this meeting will take place within this month.”

It is the latest setback to hit the long-delayed section of the pipeline that would link the two neighbours and help ease Pakistan's chronic gas shortages.

US officials have warned that the project would risk triggering sanctions aimed at Iran.

But Abbasi denied coming under pressure from Washington since Prime Minister Nawaz Sharif came to power in the May general election. “Americans have not so far talked about this pipeline with us at any level,” he said.

Asked if Pakistan was hoping to complete the project before the December 2014 deadline, Abbasi replied: “Anything is possible, if we have the resources.” “It depends on the financing and availability of the machinery,” he added.

Iran has the second largest gas reserves in the world but has been strangled by a Western embargo that has seen its crude exports halved in the past year.

It currently produces around 600 million cubic metres of gas per day, almost all of which is consumed domestically due to lack of exports. Its only foreign client is Turkey, which buys about 30 million cubic metres of gas per day.

The Karachi stock exchange took fright when the countries' then-presidents Mahmoud Ahmadinejad and Asif Ali Zardari inaugurated the much-delayed section of pipeline in March.

Spooked by fears of US sanctions, the main index slumped almost 2.5 per cent.

Abbasi said the government had sought bids from Pakistani and Iranian companies for pricing of the construction cost of the pipeline.

 

[Surenas]

$2 billion? I thought the last time they asked 500 million? Anyway, the decision should be made based on a cost–benefit analysis.

Iran has the second largest gas reserves in the world but has been strangled by a Western embargo that has seen its crude exports halved in the past year.

Old statistics; Iran doesn't have the second largest gas reserves in the world, but the largest.

 

[SOHEIL]

2$ billion?

& next ??? free gas !?

 

[[Bregs]]

This gas field can be viable if India is part of the deal, but main obstacle at present seems to be safety of this pipeline from terrorists who are having blast at there free will

 

[rmi5]

2$ billion?

& next ??? free gas !?

Its not a big deal Soheil, Its just a usual thing in business. even for Iran Turkmenistan gas pipeline, Iran financed the project and received its benefits after finishing the pipeline. but the gas price should be reasonable ...

 

[Fireurimagination]

The pipeline is a non-starter, it's just a election gimmick in Pakistan. Pakistan doesn't want to get sanctioned by US so they are just playing with Iran.

 

[rmi5]

This gas field can be viable if India is part of the deal, but main obstacle at present seems to be safety of this pipeline from terrorists who are having blast at there free will

Nope, India's presence is not necessary at all. Sorry, but India has proved to be unreliable. the pipeline can be more economically beneficial if they connect to China as well, by considering the gas deals that already exist between Iran, and China.

 

[LURKER]

The reason India abstained from participating in this project. If we did they'd be asking us to built their share of the pipeline in the name of 'Aman ka Tamasha'. Add to that the daily threat of non state actors to the pipeline.

 

[my2cents]

I read about Pakistan asking for a $500 million loan but now they want the whole project to be financed by Iran. Why do you even sign the deals when you know you will be face the sanctions??

 

[Sugarcane]

OP - Your comment are uncalled, anyway some basic thing you should know

1- It's because of sanctions that nobody is interested in investing this project.
2- Pakistan & Iran's relation are not that much strong that Pakistan would go for risking sanctions.
3- Pakistan is a customer & a customer always try to get max it can - It's up to Iran to decide either accept it or reject it.
4- This not a new thing, there are many examples where supplier do initial investment
5- This financing is not free, Iran will recover it with interests.
6- I don't think there are any chances of gass flowing through this pipeline unless there is some breakthrough in Iran-US relations and it's fact.
7- Your govt. has sold oil at cheap rates to other countries not Pakistan - so keep your rants to yourself.

I read about Pakistan asking for a $500 million loan but now they want the whole project to be financed by Iran. Why do you even sign the deals when you know you will be face the sanctions??

Why you signed the deal and ran away? Don't come with your as usual remarks of security, you knew the route at time of signing the deal.

 

[Sugarcane]

The reason India abstained from participating in this project. If we did they'd be asking us to built their share of the pipeline in the name of 'Aman ka Tamasha'. Add to that the daily threat of non state actors to the pipeline.

LOL!!! What an excuse from richi rich indian - the fact is that you used iran card to negotiate with US

 

[INDIC]

Nope, India's presence is not necessary at all. Sorry, but India has proved to be unreliable. the pipeline can be more economically beneficial if they connect to China as well, by considering the gas deals that already exist between Iran, and China.

Any Iran-India pipeline shouldn't pass through Pakistan. But I am surprised why will Iran expand the pipeline to China via Pakistan when China already have a pipeline plan until Turkmenistan which could be expanded into Iran.

 

[Bhai Zakir]

Mod Edit

If u are giving gas then u should also give the money that's a strange one.

Iranians hatred towards Pakistan is hilarious!

If you iranians hate us so much then why not tell your govt to cancel the project?

1. Read his post he is actually asking for it

2. Its not about hate but the bad investment decision every country needs money and Iranian money is hard earned they don't want to waste it.

The reason India abstained from participating in this project. If we did they'd be asking us to built their share of the pipeline in the name of 'Aman ka Tamasha'. Add to that the daily threat of non state actors to the pipeline.

It can build avoiding pakistan, under the sea.

 

[rmi5]

Any Iran-India pipeline shouldn't pass through Pakistan. But I am surprised why will Iran expand the pipeline to China via Pakistan when China already have a pipeline plan until Turkmenistan which could be expanded into Iran.

It is understandable. the fact is turkmenistan china pipeline has a limited capacity, and turkmenistan government is a crazy dictatorship that may close the pipeline to put pressure on Iran whenever they want. in addition Iran will need to pay a transit fee to turkmenistan or pakistan in this case, so if there are two different routes, we can haggle more and pay less transit fee.

 

[Contrarian]

LOL!!! What an excuse from richi rich indian - the fact is that you used iran card to negotiate with US

India used the Iran card with US because India was highly reluctant to join the project in the first place.

The prime reason for India backing out of this project is that it would be running overland in Pakistan.

1. Pakistan cannot truly assure the safety of the pipeline running across the width of Pakistan regardless of what it signs on the paper. They throw up their hands and point at 'non state actors' at every moment. Any agreement with Pakistan is not worth the paper it is signed on.

2.Secondly, Pakistan is not a stable country. There is no guarentee there would not be a coup, or some leader or Mullah gets a fit and decides to shut down the supply to India.

3. Even Iran recognized this problem, which is why it denied India's condition that India would only pay for the quantity of gas it actually recieves on its border, not the gas that Iran releases from its end - and Iran would stand guarentee for India recieving as much gas as it has contracted with Iran.