FederalMinister for Finance and Revenues Shaukat Tarin on Wednesday said that Pakistan and Russia have broadly agreed to establish the North-South Gas Pipeline Project with an estimated cost of approximately $3 billion. In the wake of an ongoing war between Russia and Ukraine, Pakistan will have to move forward in a careful manner.
This pipeline project has become important for Pakistan to move towards the finalization of this important deal, mainly because the country could not meet its pressing energy requirements without placing this muchawaited desired infrastructure.
Both sides had already signed the Inter-Governmental Agreement for the construction of the North-South Gas Pipeline of 1,122 kilometers from Karachi to Kasur as it will increase the capacity of the country to transport imported gas from port to the central part of Punjab.
“Yes, we have broadly agreed for establishing this multi-billion gas pipeline project with Russia and now future virtual
talks were expected to finalise the shareholders agreement and execution of this project,” FederalMinister for Finance Shaukat Tarin said when The News inquired from him about the finalization of North- South Gas Pipeline Project here
on Wednesday. He said that the cost of this project was estimated at around $3 billion but it would be firmed up after the conclusion of upcoming virtual parleys between the two sides.
Another federal minister of PTI-led government also confirmed to The News that the gas pipeline project was almost finalized with an estimated cost of over $2.5 billion.When inquired why the cost of the project had escalated and went up to $3 billion, he said that the prices of steel and other products in the international market had gone up, so the cost of the project would also be increased.
The inter-government agreement between Pakistan and Russia has been updated as a protocol to reflect the utilization of Gas Infrastructure Development Cess and continued partnership with Russia to construct this
project. Under the amended agreement, the North-South Gas Pipeline has been renamed as Pakistan Stream Gas Pipeline and to this effect, a PSGP Special Purpose Vehicle will be set up after signing of the protocol
to implement the project. It was the second time the IGA was signed as the North-South Gas Pipeline was earlier signed between both countries in 2015 but was never implemented.
Pakistan needs a gas pipeline to transport LNG from South to North. The government wants to increase the scope of capacity and design of the project to transport 1.6 billion cubic feet of gas per day (bcfd) as earlier it was proposed with the capacity to transport 1.2bcfd.