“Work Commences on IP Gas Pipeline Project Ahead of Iranian President’s Visit to Pakistan”


As Iranian President Ebrahim Raisi prepares for his visit to Pakistan on April 22, the Ministry of Energy has initiated work on the Pakistan-Iran Gas Pipeline Project. The project aims to materialize an 80-kilometer pipeline from Gwadar to connect with the Iranian pipeline, with an estimated completion time of 24 months and a budget allocation of Rs44 billion from the Petroleum Division’s 2024-25 Public Sector Development Programme (PSDP).

The Inter-State Gas Company (ISGS) has issued tenders for re-validation of surveys and Front-End Engineering Design (FEED), a step delayed for long. However, the project faces opposition and potential sanctions from the United States, causing delays since its original deadline in 2014.

Iran has urged Pakistan to complete its portion of the pipeline by February-March 2024 to avoid an $18 billion penalty under the Gas Sales Purchase Agreement (GSPA). The immediate focus is on laying the 80-kilometer pipeline section to avert arbitration and subsequent penalties.

Initially designed to handle 100 million cubic feet per day (mmcfd) of gas, the project anticipates a capacity of 750 mmcfd over 25 years. Land acquisition and Engineering, Procurement, and Construction (EPC) contracts will follow the initial phase of pipeline construction.

Story by Naveed Butt

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