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Pakistan Looking at New Ways to Build Iran Gas Pipeline

Pakistan Looking at New Ways  to Build Iran Gas Pipeline Pakistan Looking at New Ways  to Build Iran Gas Pipeline

Pakistan's Foreign Office said that Pakistan and Iran are looking at "new ways" to pursue the multi-billion dollar Iran-Pakistan gas pipeline project for importing 750 million cubic feet per day Iranian gas, currently threatened by US sanctions.

Foreign Office spokesperson Tasnim Aslam, while responding to media queries during her weekly press briefing, said that the project is facing a delay for certain reasons.

 It was for this reason that Pakistan and Iran signed an agreement under which Iran was to provide a soft loan of $500 million for building the pipeline on Pakistani side, she said.

"Because of the [US] sanctions, Iran is not able to fulfill the commitment and therefore, Pakistan also cannot make progress on the project... Both sides are however, committed to building the pipeline and we are looking at new ways for making it a reality," she added.

Ali Majedi former Iranian deputy oil minister, said earlier in September:  "Despite an agreement between the former Iranian government and Pakistan for Iran to provide the required funds, Iran is not able to help with the financing of the project, given the country's [economic] circumstances."

According to a report by ISNA, the pipe laying project within Iran's border was carried out at a cost of $2.5 billion dollars, however, the 780km pipeline due in Pakistan has not been laid as the Pakistani government faced difficulty in funding the project.

According to the preliminary agreement between the two countries, if the gas export to Pakistan does not commence by December 31, Pakistan must pay Iran $200 million per month.

Bijan Namdar Zanganeh, the oil minister, said previously that Pakistan had asked for a two and half year delay with the project, which has been rejected by Iran.

Financialtribune.com