Impossible to work on pipeline under sanctions: Pakistan tells Iran

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ISLAMABAD: Pakistan has told Iran in writing that so long as Tehran is facing sanctions from the USA, it would be impossible to build the gas pipeline.

Arab News reported that Mobin Saulat, the managing director of Inter State Gas, said that it was impossible to execute the gas pipeline project between the two countries as long as Iran was included in the US sanctions regime.

“This has been conveyed to Iran,” he said.

Iran formally sent a notice to Pakistan in February, after fresh negotiations were held between the two countries regarding the pipeline.

Tehran said that it would move an arbitration court against Pakistan for failing to lay down the pipeline in Pakistani territory within the stipulated time period in the bilateral agreement.

Saulat said that the government had time till August to respond to Iran’s notice. He said that Pakistan was hopeful of resolving the issue through a discussion with Iranian officials.

“We cannot risk US sanctions by going ahead with the project as America has clearly said that anybody who will work with Iran will also be sanctioned,” he said.

He said that Iranian authorities claimed that the sanctions were not applicable on the pipeline.
“We have sent a questionnaire to Tehran to ask as to how is that the case,” he asked.

According to the agreement signed between Pakistan and Iran in 2009, the Iran-Pakistan gas pipeline project was to be completed by December 2014 and would deliver 21.5 million cubic meters of gas per day to Pakistan.

According to the Gas Sales Purchase Agreement, Pakistan will have to pay $1 million each day from January 1, 2015 for failing to build the pipeline in its territory.