Pakistan to start importing Iranian gas
The bidding for Pakistan's part of Iran-Pakistan Gas Pipeline Project would commence shortly, Pakistani Prime Minister Seyed Yousuf Raza Gilani told the visiting Italian Foreign Minister Franco Frattini on Thursday.
The Pakistani prime minister expected that Italian oil and gas exploration company ENI, while competing for the pipeline project, would also be financially supported by the Italian government for undertaking the project, IRNA New Agency reported.
The $7.6 billion project is crucial for Pakistan to meet the fast growing energy crisis, causing severe electricity shortages, People's Daily reported.
Pakistan and Iran formally signed the historic pipeline deal in Tehran on June 13, under which Iran will supply Pakistan with natural gas from mid-2014.
Under the deal, Pakistan will import from Iran 750 million cubic feet of gas daily for 25 years.
The petroleum ministry says the imported gas would help generate about 5,000 MW of power.
The pipeline would connect Iran's South Pars gas field with Pakistan's southern Balochistan and Sindh provinces.
In June, the Pakistani prime minister, defying a warning from Washington, promised to go ahead with a plan to import natural gas from Iran.
The pipeline was initially mooted to carry gas from Iran to Pakistan and on to India. The IPI gas pipeline is a proposed 2,775-kilometer pipeline.
The negotiations have been going on for many years involving Iran, Pakistan and India. Iran's enormous gas reserves are ideally suited to supply massive amounts of gas to both Pakistan and India on long-term basis, thus helping ease the energy requirements of the two giant developing nations.
Iran, Pakistan, and India conceptualized the Peace Pipeline project in the 1990s, to help boost peace and security in the region.
Negotiations over the project were initiated in 1994 between the three countries but there were obstacles to closing the three-way deal due to tension between India and Pakistan.
Iran's proven natural gas reserves are about 1,000 trillion cubic feet, of which 33 percent are as associated gas and 67 percent is in non associated gas fields. Iran has the world's second-largest gas reserves after Russia.