Islamabad—In a marked development, the ministry of petroleum and natural resources (MoPNR) has extended the No Objection Certificate (NOC) to Frontier Works Organization (FWO) permitting it to initiate the feasibility study for erecting the multi-billion dollars oil pipeline from Gwadar to Kashgar (China).
Frontier Works Organization had pitched the said proposal with the ministry for laying down the oil pipeline from Gwadar to Kashgar to cater to the future energy needs of the western part of China which Beijing wants to build and develop it at par with the eastern part.
“Yes, we received the FWO’s proposal seeking permission to go ahead for most difficult project some weeks back. We brainstormed the proposal and ultimately extended the NoC to FWO to initiate the feasibility of the project and arrange financing with collaboration of other Chinese companies and execute the project,” a senior of official told Pakistan Observer.
The same project was earlier floated by the Zardari government in 2008, but Chinese government opted to stay away from the project arguing the project is itself is just like a (Mission Impossible) as it involved the difficult terrain, mountains of Himalayas with over 15,000 to 20,000 metres high through which the oil pipeline will pass requiring the high technology and ultra pumping stations to keep pushing the oil flow up to the most elevated area of Kashgar.
This time, the official said, FWO desired to take over the project earlier proposed in 2008 and sought from the ministry No Objection Certificate. In Gwadar, the oil city will also be built where in high-tech petro chemical and high-tech refineries will also be installed. The refined oil will be transported from Gwadar to the Kashgar and in return all kinds of finished products will be manufactured in the western part of China. On the CPEC routes, the said products will reach not only Pakistan’s market, but would also hit the markets of Central Asian States and Gulf States through Gwadar port.
Once the feasibility study gets completed, then the FWO will be in a position to go or not to go for the project, the official said arguing in Alaska (US) such kind of project has been completed but on a small scale if compared with the proposed scale of the Gwadar-Kashgar oil pipeline. “If the proposed project gets materialised then it will be no less than a wonder.”
Gwadar is near the Persian Gulf and close to the Strait of Hormuz, which holds two-thirds of the world oil reserves and from where an estimated 17 billion barrels of crude oil passes daily. The port opens up a 3,000km-long trade corridor that will connect Gwadar to Kashgar, in China’s western Xinjiang region, via roads, railways and pipelines to transport oil and gas.
The Chinese Overseas Port Holding Company (COPHC) took over the Gwadar Port in 2013 for 40 years. Beijing and Islamabad signed $46 billion China Pakistan Economic Corridor (CPEC) which includes energy projects, building of new roads, railway lines and a network of oil pipelines to connect Kashgar to Gwadar.
The new 3,000km (1,500 mile) network of highways, rails, and oil pipelines will give China quicker access to Europe and the Middle East. Currently, China is importing around six million barrels of oil per day from different countries of the world via sea route, and the Gwadar-Kashgar pipeline is likely to take around 17 per cent of the share of total Chinese import.
The existing sea route being used by China passes through the risky South China Sea, Pacific Rim, the Strait of Malacca and Sri Lanka, and Chinese ships have to cruise about 10,000 kilometres for reaching its final destination. The Gwadar Port will reduce the sea distance to 2,500 kilometres and land distance for Kashgar to 2,800 kilometres because Kashgar is 4,500 km from the main Chinese port of Shanghai. The CPEC related projects will not only save China time but also millions of dollars.
The overland route, via Pakistan, eliminates the need to ship crude through Malacca Strait. The Chinese will establish a massive Industrial Park at Gwadar, which will house an oil city and petroleum refining zone beside dozens of other technical and logistical installations. This will help China meet its energy needs.