Construction of Gas pipeline from Iran to Gwadar approved by Caretaker government

ISLAMABAD: In order to address the nation’s ongoing energy difficulties, the caretaker administration approved the building of a vital gas pipeline on Monday, connecting the Iranian border to Gwadar.

The initiative to build the Iran-Pakistan gas pipeline, which has been delayed since 2013, is one step closer to reality with the approval from the caretaker cabinet.

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The government Committee on Energy gave its assent, and the caretaker government decided to move on with building an 81-kilometer (km) gas pipeline. This will make it possible to transfer 750 million cubic feet of gas from Iran to Gwadar, giving Pakistan, which is severely short on funds, a less expensive option to importing LNG.

It is anticipated that the clearance will also protect Pakistan from fines of up to $18 billion if the project is not completed on time. This will allow Pakistan to purchase gas from Iran at a lower cost, resulting in significant annual savings.

Pakistan chose to proceed with the gas pipeline project even though the United States (US) threatened to impose crushing sanctions on Iran. In addition, it is pursuing legal and diplomatic avenues to get over the penalties imposed on the pipeline project. Concurrently, the first phase of the gas pipeline project within Pakistan’s borders has been completed with the permission of the departing federal government. An 81-kilometer section of the pipeline is scheduled to begin construction shortly, with an estimated cost of $158 million.

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Following the Cabinet Committee on Energy’s recent approval of the pipeline’s construction within Pakistani territory, the project gained momentum. Simplifying the decision-making process was another benefit of establishing a Ministerial Oversight Committee (MOC).

Although the pipeline’s Iranian portion is finished, development of the Pakistani portion was delayed due to unpredictability. Pakistan has been given till September 2024 by Iran to finish the pipeline’s development.