ISLAMABAD: Pakistan and Russia have signed a revised deal for laying the Pakistan Stream Gas Pipeline formerly known as the North-South Gas Pipeline.
The two sides on Wednesday agreed to rename the North-South Gas Pipeline as the Pakistan Stream Gas Pipeline due to major shareholding for Pakistan. They also agreed in principle to execute the project through a special purpose company which would be incorporated in Pakistan.
Russia will have a minority shareholding in the gas pipeline project but Pakistan will ensure maximum utilisation of Russian material, equipment and resources. In the revised project structure, Pakistan will hold 74% shares whereas Russia will have 26% stake. Earlier, Russia had to build the pipeline on the build, own, operate and transfer (BOOT) model and transfer its ownership to Pakistan after 25 years.
Russia had also to make 85% of the required expenditure on the project whereas Pakistan had to spend 15% of the capital. The gas for the project will be sourced through existing and new LNG Terminals at Port Qasim Karachi.
The Ministry of Energy of Pakistan and Russia held the first Russia-Pakistan Technical Committee meeting in Islamabad from 16-18th November on mutual cooperation for the development of the North-South gas pipeline project. Â The talks were also attended by Minister for Energy and Special Assistant to Prime Minister on Petroleum.
The discussions were aimed at finalizing the broad contours and parameters of the project involving the construction of a high-pressure gas transmission pipeline from Port Qasim, Karachi to Kasur in Punjab for transportation of RLNG towards the northern side of the country in order to fulfill the gas shortage.
The recent developments after the decision of the Supreme Court of Pakistan and the availability of Gas Infrastructure Development Cess (GIDC) funds for project development were key considerations in the process.
While giving the concluding remarks at the session, Federal Minister for Energy Omar Ayub Khan lauded finalisation of the pipeline’s protocol and expeditious implementation of the project. He said that the government of Pakistan envisages this as a first step towards the establishment of a strong bilateral relationship and strategic ties towards Russia. He hoped that this project would benefit both countries and such cooperation between the two countries would continue in the coming years.
In his closing remarks, Nadeem Babar said that the North-South Gas Pipeline ‘a stepping stone’ towards greater cooperation between Pakistan and Russia in the energy sector. He said that Pakistan is fully committed for an early realisation of this key project and looks forward to working with Russia in an efficient manner.
