No all-clear from US for IP gas pipeline project

Some American sanctions against Iran still in place, says US assistant secretary

ISLAMABAD:

A top US official has advised caution on the multibillion-dollar gas pipeline between Iran and Pakistan, saying that some American sanctions against the Islamic Republic are still in place.

The United States and European nations lifted crippling sanctions on Tehran on January 16 after international inspectors confirmed the country had honoured its commitment to dismantle large sections of its controversial nuclear programme.



However, the US Department of Energy’s assistant secretary for international affairs told a news conference in Islamabad on Monday that some American sanctions were still in place.

“Pakistan will be entering gas agreement with major international gas suppliers very soon. The case of IP gas pipeline project is still to be judged,” Jonathan Elkind said while announcing the launch of a three-year technical assistance programme designed to support Pakistan’s energy development efforts.

“Indeed there has been a great deal of progress between Iran and the international community, including the United States, on most sensitive issues,” he said. “We have been pleased to launch initial implementation of joint comprehensive action and move successfully towards implementation day, a moment which prescribes a list of international sanctions.”

In the case of the United States, certain other sanctions are still in place against Iran which affect the ability of American legal persons and other parties using American financial systems to participate in projects with Iran, he added.

Elkind also said the Russian company picked out to develop gas infrastructure in Pakistan was facing US sanctions. “Pakistan is to determine and decide energy choices,” he added. He was referring to RT Global Resources, a firm Moscow has nominated to build a north-south Liquefied Natural Gas (LNG) pipeline in Pakistan.



Asked about the development of coal-based power plants in Pakistan, the US official said the share of coal in the US energy mix has been dropped significantly. He cited the discovery of inexpensive natural gas reserves in the US as a reason.

“Globally too, a number of other countries which were earlier heavily dependent on coal are now working to reduce its share in their energy mix due to health problems. It affects human health, especially leading to premature death of children,” Elkind said. “In the end, it’s Pakistan’s choice.”

Asked if LNG could ease Pakistan’s energy woes, he said LNG was a part of solution. “It’s for Pakistan to decide how big role LNG should play,” he added. “Pakistan has a sizeable domestic resource base which has not been tapped.”

He said some countries had nuclear energy as part of their energy mix – but it required very serious and careful treatment. “We are working with Pakistan to facilitate it to pick out best energy options,” he added.

Elkind said Washington and Islamabad had entered a new phase of energy cooperation. Under this project, the two countries would work on energy efficiency and development of the power grid system in Pakistan.

“We have an ambitious target for Pakistan-US energy partnership. And we have very good reasons to be optimistic due to the kind of changes Pakistan has made in its energy sector,” he said. “The Pakistan government has come up with a great deal of focus on the energy sector.”



Under the new phase of Pakistan-US energy cooperation, the use of application in the energy sector would be promoted because its prices have come down drastically in the world, he said. “Renewable energy can balance the load for supply from different variable resources. This is the area of cooperation in which we are focusing on technology for sustainable power.”

Published in The Express Tribune, February 9^th, 2016.