Iran has already spent hundreds of millions of dollars and nearly completed the 900 km (560 mile) pipeline to the Pakistan border. PHOTO: AFP
The comments follow remarks last month by Iran's oil minister that the country would probably abandon the contract, prompting speculation that the two sides had decided to ditch the project altogether.
"There is no decision to shelve anything, there is no decision to delay anything, but the constraints remain," Abbasi told Reuters in an interview in Islamabad.
The $7.5 billion project has faced repeated delays since it was conceived in the 1990s to connect Iran's giant South Pars gas field to consumers in energy-hungry Pakistan and India.
Pakistan has pursued the pipeline as a way of alleviating severe energy shortages that have sparked violent protests and crippled the economy. At the same time, Islamabad badly needs the billions of dollars it receives in US aid.
The United States has steadfastly opposed Pakistani and Indian involvement in the project, saying it could violate sanctions imposed on Iran over nuclear activities Washington suspects are aimed at developing an atom bomb. Iran denies this.
"There are constraints with the construction of the pipeline," Abbasi said. "There is a threat of sanctions, either US or UN, and probably EU also. That limits what options we have with the construction of the pipeline.
"We are really hopeful that construction should start soon, as soon as these issues are resolved."
India, unlike Pakistan, quit the project in 2009, citing costs and security issues - a year after it signed a nuclear deal with Washington.
Pakistan, for its part, has made little progress on its section of the line for lack of funds and warnings it could be in violation of US sanctions on Iran, which sits on the world's largest reserves of gas.
"The moment we connect the gas, the sanctions hit," Abbasi said, adding that the sanctions would particularly affect the equipment procurement process and other technical issues.
"We can construct the pipeline right up to the last metre, but the moment we connect, the sanctions are coming."
Iran has spent hundreds of millions of dollars and nearly completed the 900-km pipeline to the Pakistan border.
Under the contract, Iran is supposed to export 21.5 million cubic meters of gas per day to Pakistan from next year.
The cost of the Pakistani section of line is estimated at around $2 billion and Abbasi said Pakistan was ready to finance its part on its own.
COMMENTS (13)
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The Pak-Iran gas pipeline could have been completed by now if the government have given half the importance to the more than 2 dozen articles written on it by the esteemed E.T. The petroleum minister should at least go through such related articles even if they are lethargic and incompetent to the core.
Mr. Shahid Khaqan Abbasi - please answer the following:
Are you prepared to go against the whims of US? Are you prepared to go against the wishes of KSA? Are you have money to even start the pipe line. Are you ready to explain the people about the economic benefits of this pipeline.Don't try to going on deceiving the people.
IP has always been about politicians creating the image that they are doing something about the so called "energy crisis" while supporting the anti USA sentiment by doing something that the American's don't want. It's been nothing but drama since day one and has never had any substance. You never performed an economic feasibility study, never hired someone qualified to determine cost, never explained how you would pay for the pipeline or how you would protect the investment. Just a duplicitous sham from the get-go.
The people of Pakistan need to understand the economics of this pipeline.First of all, Pakistan did not intend to use this gas for domestic purpose. They were interested only in transit fee earned from India and may be China if the pipeline was extended to it. But because of energy crisis they started to think about using this gas for domestic purpose too. Lot of water has flown under the bridge since last 10 years. India is not part of project citing valid security concerns and getting Nuclear deal from US. China is not showing much interest in it so now only two players are left in the game, Iran and Pakistan.Pakistan never had money to build this pipeline any way. It was supposed to come either from India or China.In absence of both, it can't be build by Pakistan and if some one even think for a moment that Pakistan can build it, can it afford the expensive gas? Zardari government played a dirty game. They signed the project in last days to earn political points. Now Pakistan is standing between a rock and a hard place. If they don't complete the pipeline, they are liable for high penalties and if they complete the pipeline, they would be investing $2b for expensive gas that they can't afford not to mention running into sanctions by US/EU if Iran does not cut a deal with them.
Another lie of PMLN government.
First, the sanctions don't hit the countries but the companies and its associates dealing with Iran. Essentially, it does not affect indigenous companies with no international presence.
Second, "[U.S. Will Ease Sanctions if Iran (Temporarily) Halts Nuclear Program, Official Says]"1
just a lame excuse. PML-N government has declared in the past that they will do negotiation with taliban whether or not U.S.A support it its all about their will they had done nuclear test, attacked on kargil, give refuge to Mr ladin they just do any thing they want and our foreign and international policy is dictated by many factors like intrusion of KSA especially in case of iran because of Iran being a shia state plus involvement of our army .when our army wants to fight they do so and when negotiation they do so without any pressure India has also established business relations with IRAN.
Only one reason. Nawaz Sharif has no option but to dance to the tunes of the Saudi King. He sold his soul long time ago. Saudis are against this deal, and Nawaz has to oblige. It happens when you make a deal with the devil and sign it with your blood.