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Pakistan decides to put off $7.5b IP gas pipeline project over curbs on Iran

Pakistan decides to put off $7.5b IP gas pipeline project over curbs on Iran

ISLAMABAD: The Pakistani government has decided to end $7.5 billion Iran-Pakistan gas pipeline project due to international sanctions on the Islamic Republic over its controversial nuclear programme.

As per the media reports, the government believes that the IP project couldn’t be carried out under the current geopolitical situation and it has decided the border phase of the project would only be implemented once international sanctions were lifted.

Sources said that the crucial decision was taken during the Economic Coordination Committee (ECC) meeting held on October 2. The meeting was informed that a gas sales and purchase agreement (GSPA) between the Inter-State Gas Systems Pvt Limited (ISGS) from Pakistan and the National Iranian Oil Company (NIOC) was signed in June 2009.

Despite Pakistan’s best efforts, the project repeatedly hit snags due to the international sanctions imposed on the Islamic Republic for its controversial nuclear programme. Iran’s association with the project and possible risk of violating sanctions has scared away potential financiers, reputable international suppliers of crucial equipment and contractors.