Iran has extended the deadline for its gas pipeline project with Pakistan by 180 days to September 2024. Iran has warned its neighbor that it will petition the Paris-based International Arbitration and demand an $18 billion penalty from Pakistan if the case goes to arbitration.
Tehran has volunteered to send its legal and technical teams to Pakistan to collaborate on a win-win approach before the 180-day deadline expires. The technical teams will aim to ensure that the project is completed and arbitration is avoided, local media reported today.
The team from Iran will travel to Pakistan in the second week of February 2024. Both parties would devise a viable strategy for bringing the project back to life. The Iranian team would include professionals in international relations, legislation, legal structure, and engineering.
Iran previously requested Pakistan in its second notice in November-December 2022 to build a segment of the Iran-Pakistan Gasline project on its territory by February-March 2024 or face a $18 billion fine. Before that, Tehran notified Islamabad in February 2019 that it would seek arbitration for failing to install the pipeline within the timeframe specified in the pipeline project.
Pakistan has maintained its stance that it is unable to work on the project due to US sanctions on Iran, a position to which Tehran has never subscribed, claiming that the US restrictions are unjustified.
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If Pakistan uses local pkr for settlement of invoices than we can avoid international sanctions.
We need cheaper gas more than ever to bring down cost of production. Alas no strong government to make big decisions.
PKR settlement for a commodity like gas is not realistic. Iran has not use for PKR, Yuan is a more realistic option and Iran does have a sizable import bill in Yuan that it can settle.
Bro, we cannot because How Iran will exchange the currency. Instead we should use gold as past. Because it’s very stable option for both.
All Iranian oil and gas exports are subject to USA sanctions. Lack of swift is not the only issue. Any waivers are subject to USA political goals. Iranian electricity exports are not sanctioned. Best to change the project scope into a gas to electric energy project.
Sanctions will only get worse for Iran in the current environment. IMO, Project scope needs to change. Iranian electricity exports are not sanctioned. I think its best to setup electric plants at the border were the IP pipeline should terminate. Gas pipeline should be metered on the Iranian side with settlements in local currency. Electricity would go to Pakistani side.
If Pakistan cant materialised the project of IPI then purpose of establishing of Inter state Gas department was useless, which had been established in 2005.The company has more than 200 employee a Managing Director and 12 BOD members.The management,employees and BOD are withdrawing millions of Rupees as salariesPM being paid from the national exchequer.The Petroleum division and its stalwarts were well awared of the US embargos but even though they formed ISGCL and till date this white Elephant is feeded with hard earned money of the nation.The purpose of establishing ISGCL was to work and execute IPI and TAPI projects but unfortunately the ISGCL is a dead elephant surving on the blood and fleh of the nation and failed to accomplished its goal.
Why the Gas prices are enhanced every quaterly.The main issues has never been unearthed by any writer so far the reason may be because of their non technical aptitude or may be due to lack of the information.The different causes of gas prices enhancement are discussed in depth for the awareness of general public. In my view the following are few of the reasons being the cause of the enhacement of the gas prices negleted by the govt and Petroleum division.
1.Uncontrolled gas looses(Theft,leakages)
2. 200 times greater Salaries than prevailing market rate.
Each of the Managing Directors of gas distribution Cos( SNGPL& SSGCL) are getting more than 8 Mn PKR PM other than Perks and prevellages allowed as per com rule.Along with perks and preveillages as per co rule.Accumatively it almos touches 12 Mn PKR PM.
3. There are more than four DMDs in both Co each DMD is getting approximtely 6Mn PKR PM excluding Perks and Preveillages.
4 . Senior General Managers.The total number of SGMS in both Cos are more than 20 and each SGM is getting more than PKR 3 Mn PM excluding other benifits of petrol,Mefical ,drivers and two cars for office and family .
5 General Managers.There are more than 30 General Mangers in both cos and each GM is getting more than PKR 2Mn PM excluding other fecilitie of 400 liters petrol and servantd for home.
6 Deputy General Managers Chief Enginers.There are more than 40 DGMs/Chief Engineers in both Cos and each is getting from .5 Mn PKR to 1Mn PKR PM along with unlimited medical and 300 liters petrol.
Similaraly there are 5000 in both cos and their salaries varies between
PKR .5 Mn to 1 Mn PKR PM.
The question is what is the role of these heaviest paid peope if they cant control the menace of theft and leakage.Commonly called UFG (un accounted for Gas) wich is 22% in system of Sui Southern Gas Co and 13% in case of SNGPL.The ogra bench mark for UFG is 6% and above 6 % a penality of PKR 1 Billion is levied on the gas co.So simply we can say that SSGCL is paying PKR 16 Bn and SNGPL is paying PKR 7 Bn out of the pocket of end consumers as penalty annually due to the inability and ineffciency of the management of both Cos.Both Gas Cos are facing circular debt/ loosesof PKR 3 Trillion.
Is the Minister of petroleum Division and stalwarts of Pet Div are sleeping or they closed their eyes ignoring the inefficiencies due some other reasons and compensating the looses from the pockets of the nation.
Energy Crisis is killing us. Gas from Iran will be utilized for peaceful purposes. Indians purchased petrol from Iran for it’s requirements. It is time we must present our case to US for gas pipeline. Irrespective of the fact whatever court ruling come from international court, we must purchase gas from Iran.
How the Americans will be convinced that this gas pipeline is our life line, that is million dollar question. It is the duty of those who are at present in power/ shortly in power.
The important thing is that our economy is in total mess. IMF saved us from default and that was possible only with US blessings.
We need to immediately start the work on the pipe line before the election becoz the political ppl will never allow due to multiple interests & pressures. Pakistan defence forces must take this project in hand & the NLC + FWO to start work Now. We will never be able to proceed without this mode. Pakistan’s industry will immediately come in with a fresh start & we will be able to payback in half the time Inn Shaa Allah. The joint chief of staff must come into action & takeover this sleeping project to ensure prosperity in the country. Jobs will open in multiple ways. The only best job done by Mr Zardari before he left….he wanted to ensure the ppl who come at the top are stuck & cannot deliver on this account. Iran & Pakistan will both benefit as was done in case projects started by President Ayu Khan than…..
If government (current or future) decides to implement the agreement, then it will be obvious that Pakistan is free from any pressure from any International Power.
Under the current circumstances when TAPI line is not possible only option is IPI. If China, India & others can buy oil & gas from Russia, Iran & Venezuela which are under SANCTIONS why can’t we go for Iran gas?
Pakistan is using imf money its a part of US. THERE FORE Iran has to do simple to solve this problem IRAN has to give those point to pakistan regarding with sanction to proceed with the gas matter. Or If PAKISTAN have not proceed then forget the fine simple thing IRAN has to used is pipe line from pakistan to another country and get profit.
This pipeline is vital for Pakistan. We have already doubled its cost delaying it for so many years. US should have no say on this! I remember on onecinternational forum, their representative declined any US involvement.
So, Pakistan should start it ASAP.