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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--The proposed Iran-to-Pakistan gas pipeline project has been mired in controversy and delays since it was first mooted. Obstacles include strong objections to the project by the U.S., related to its sanctions against Iran.
Jam Kamal Khan, Pakistan's Minister of State For Petroleum and Natural Resources, told parliament that it could take two years to complete the Pakistan section of the project.
The pipeline will start from an onshore gas processing facility in Assaluyeh, Iran, and follow a 1,150-kilometer route to the Pakistan border. Iran already has completed a 900-kilometer portion of the 56-inch-diameter pipeline from Assaluyeh to Iran Shehr.
Iran will operate the part of the pipeline running through its territory. The 250-kilometer balance of the Iranian section is under design and is expected to be completed in two years' time, the same time Pakistan says that it will take to complete its section.
When Pakistan signed the Gas Sales Purchase Agreement (GSPA) with Iran, both parties were required to complete their sections by December 2014. The countries also agreed to "take or pay" the contractual volume, gas supply or purchase shortfalls and termination of the contract by either side, except for reason of "force majeure."
As the two parties are in lockstep on delays, some finessing on the implications of the GSPA can be expected. Despite Pakistan saying that the pipeline project will proceed, even in the face of threatened U.S. reaction, it seems likely that a pause in the progress may suit Pakistan politically; however, it will mean another delay in tackling the country's fuel shortages.
Pakistan's government is planning to accelerate the exploration for natural gas and will provide special incentives. In the past five years, 36 exploration licenses have been issued to companies in the sector.
For related information, see July 31, 2013, article - Pakistan to Expedite Peace Pipeline Project, and March 13, 2013, article - Iran-Pakistan Gas Pipeline Moves Ahead in Face of U.S. Sanctions Threat.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
Jam Kamal Khan, Pakistan's Minister of State For Petroleum and Natural Resources, told parliament that it could take two years to complete the Pakistan section of the project.
The pipeline will start from an onshore gas processing facility in Assaluyeh, Iran, and follow a 1,150-kilometer route to the Pakistan border. Iran already has completed a 900-kilometer portion of the 56-inch-diameter pipeline from Assaluyeh to Iran Shehr.
Iran will operate the part of the pipeline running through its territory. The 250-kilometer balance of the Iranian section is under design and is expected to be completed in two years' time, the same time Pakistan says that it will take to complete its section.
When Pakistan signed the Gas Sales Purchase Agreement (GSPA) with Iran, both parties were required to complete their sections by December 2014. The countries also agreed to "take or pay" the contractual volume, gas supply or purchase shortfalls and termination of the contract by either side, except for reason of "force majeure."
As the two parties are in lockstep on delays, some finessing on the implications of the GSPA can be expected. Despite Pakistan saying that the pipeline project will proceed, even in the face of threatened U.S. reaction, it seems likely that a pause in the progress may suit Pakistan politically; however, it will mean another delay in tackling the country's fuel shortages.
Pakistan's government is planning to accelerate the exploration for natural gas and will provide special incentives. In the past five years, 36 exploration licenses have been issued to companies in the sector.
For related information, see July 31, 2013, article - Pakistan to Expedite Peace Pipeline Project, and March 13, 2013, article - Iran-Pakistan Gas Pipeline Moves Ahead in Face of U.S. Sanctions Threat.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
