The Petroleum Division has invited Russian side to visit Pakistan during the current month aimed at discussing advancement on the North-South Gas Pipeline Project (NSGPP) for laying the 1100-kilomter transmission line from Karachi to Lahore.
The project, for which an Inter-Governmental Agreement (IGA) was signed between Pakistan and Russia on October 2015, faced delay due to US sanctions imposed on the latter’s nominated company RT-Global Resources, a senior official privy to petroleum sector developments told APP.
Recently, he said, the Ministry of Energy (Petroleum Division) had received a letter from the Russian side informing “replacement of the earlier proposed project company and assigning the project realization rights to the project company North South Gas Pipeline (Pvt) Limited.”
Since the Russia nominated entity was sanctioned by the US government, he said, the Russian Ministry of Energy suggested a new project company comprising “PAO TMK and Russian State-Owned company Zarubezhneft JSC (20% +1 share) and/or their affiliates, associates or subsidiaries.”
“The ministry has sought further details from the Russian side and invited them to visit Pakistan during this month to discuss and move ahead on the implementation of the project.”
The official said the pipeline would serve as a ‘vital component of energy security of the country, so “the companies/persons included in the consortium should not on the sanctions and on sanctions watch list to avoid jeopardizing the implementation of the project.”
He said Pakistan would welcome the project implementing consortium with the understanding that the structure was of sanction-free entities/persons, having pipeline building experience.
Under the project, around 12.4bcm (billion cubic meters) of gas would be transported from Karachi to Lahore per annum through a 42-inch diameter pipeline, connecting Liquefied Natural Gas (LNG) terminals located in the port city – Karachi – with other transmission network.
Currently, as many as two LNG terminals, having capacity to re-gassify 12-1300 Million Cubic Feet per Day (MMCFD) gas, was operating in Karachi.
While under its ease-of-doing-business strategy, he said, the government had recently allowed five private sector companies to set up LNG terminals, having capacity to re-gasify 500-700 MMCFD gas each.
The official said Pakistan’s existing gas reservoirs were depleting with a ratio of 7 percent per annum and unfortunately there was no significant discovery since long, adding, the trans-country pipeline projects and import of LNG had strategic significance in the prevailing situation.—APP