Foreign assistance: Russian consortium offers to fund IP gas pipeline
The interest in acquiring a contract for construction of the Iran-Pakistan gas pipeline is growing lately as GPB Global Resources, an international group of companies and a subsidiary of Gazprom Bank of Russia, has come up with an offer that it can finance the $1.5 billion pipeline project if the contract is awarded to the Russian energy giant – Gazprom, sources say.
The two sides are expected to make progress on the proposal during the upcoming three-day visit of President Asif Ali Zardari to Russia from June 19.
Earlier, during a recent trip to China, President Zardari and Petroleum Minister Dr Asim Hussain also succeeded in convincing the Chinese leadership to take part in bidding for the construction of the IP gas pipeline.
Tehran has also offered to lay the pipeline in Pakistan’s territory on a supplier credit basis. According to an official of the Ministry of Petroleum and Natural Resources, Iran is ready to provide pipeline and compressors on a supplier credit basis for which payments could be made after two years.
Iran is also willing to provide $250 million as government-to-government credit and can extend some major portion of financing from its commercial banks. Pakistan seeks over $500 million to finance the pipeline project.
GPB Global Resources is engaged in petroleum and mineral resource projects in various parts of the globe including Africa, South America and the Middle East.
The petroleum ministry official said Stroyprogress Group, the contracting arm of Gazprom, had approached Pakistan to offer engineering, procurement and construction (EPC) services with the support of GPB Global Resources.
“Our consortium is ready to fund this project with an EPC contract,” top management of Stroyprogress said in a letter sent to the government of Pakistan.
It claimed Stroyprogress Group was a well-known EPC contractor for construction of gas pipelines in Russia and had extensive work experience as the contracting arm of Gazprom.
The 42-inch diameter IP pipeline will transmit 750 million cubic feet per day (mmcfd) to 1 bcfd of high-pressure gas from the off-take point near Gwadar to Nawabshah. The country is facing severe energy crisis and gas imported from Iran will be used for power generation to end load-shedding.
Published In The Express Tribune, June 13th, 2012.
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@Whats in the name.: where are u living? obviously Pakistan will use the gas to make money and pay the debt they are not going to stockpile the gas. it point is absurd
@Anonymous: "yes take examples of Indian PM keep your records right"
Manmohan Singh is very selective about foreign travel. He either attends major conferences like BRIC, G20 etc. or just 1-2 visits to key strategic partner countries. Whenever he visits a country he gets the proper protocol for head of state. Zardari and Gilani visit UK, CHina, US so often that they are not provided any protocol.
@Jameel ur Rasheed: "I don’t know what’s stopping them?? If they can bring China and Russia into this, the two super powers can make USA enter Pakistan into that exemption list in which they recently added India. "
China itself is NOT on that exemption list. So expecting China to make Pakistan enter that exemption list is questionable.
Thats the right international move. This is the time to put pressure on USA with the help of China and Russia to get around the US pressure against IP gas pipeline.
If PPP government can pull it off and project is started before they leave, I will hate them 10 %..ok make it 15 % less :-)
The biggest problem with Pakistanis is that they do not think practically. To follow Agatha Christies rule in her novel, who benefits from a particular action. If it is IP gas line or TAP gas line or any other gas line is introduced. Russia cannot certainly export from the deep south. Distance and terrain will be spoilers. And Pakistan cannot afford to pay unless it is given in the form of loans. Now tell me how will Russians make money after investing in the project. After all there are no free lunches. Sorry, for me it is a non starter. Rgds P
Our leaders now should take some stand and go for avail the opportunity in the interest of Pakistan to avail sine have to be on our own feet
I would rather go with the Russians with the Chinese understanding and concent as it will lay the foundations of a stronger relatioship between the all of the Four (Iran). Its about time Pakistan corrects its mistake(but he didnt have much of a choice those days anyhow) made by late Liaquat Ali Khan by joining hands with the USA.India on the other hand is making a deliberate mistake by going with the USA now as the later is not cut out to help others by such treaties but itself.
I hope the pipeline gets built, but it seems extremely fishy. If Iran is prepared to lay the pipeline, supply the gas, give credit etc etc, then what is Pakistan reaching out to China and Russia for? @Jameel ur Rasheed: That list that USA has added India to still does not contain China, so its highly unlikely that China is going to pressure the US into adding Pakistan. Stop hoping for someone to step in and save you.
Nothing project of PPP exemption from corruption, soon it will be appear one more mega scandal of corruption in this project. they are all corrupt team and they do not have any intend to resolve any issue they are here just for enjoy regime and for make money through corruption it doesn't matter that Hajj, rental power plant, NICL, drug case and any else.
How many IP finance articles are we going to read before someone lays one foot of pipeline? We have already seen prior Russia finance articles and know those were bogus and based on no compete contracts and other insufferable/illegal provisions - and what happened to last weeks article which said that the Iranians were going to fund 100% of the IP? Like Mushy's return to Pakistan -- I will believe it when I see it.
I see a change in the near future .I see the Pak Fauj coming to our rescue ones again.Inshallah.
14 hours plus electricity loadshedding, no gas for cooking and industry, no CNG for transport, rapidly vanishing trees, I think our ruling class can't understand daily pain a normal Pakistani family goes through, it seems they are scared because someone will put sanctions on their foreign accounts, otherwise what we have to lose in this project!!! People say Iran wants money for gas, last time I bought gas cylinder I paid to local shopkeeper as well, what is wrong with that!!!
do bidding, then compare it with offers who does not want PPRA to be invloved and then negotiate. but who will pay penalty to Iran if we have to take U turn
pakistan should go for it
Investment / Joint Venture with Foreign Countries should always be priorities in current circumstances with little transparency at all cost. If Pakistan make this deal work out with Russia then it could be a revolutionary step towards foreign investment in the country and a positive outlook for other foreign investing countries. This would a be a big achievement for the sitting Government. If Russia starts investment in Pakistan, it could become a vital investment partner along side with China for huge future projects. President of Pakistan or other big dignitaries make several visits to foreign countries which is not a big issue in Pakistan, if a 70 members delegation along with a high profile dignitary can visit England just for entertainment and tourism on official visit, then it a foreign visit is not a matter for Pakistan, but the real issue is come along with some foreign investment / joint venture, agreements during the official visits.
@khan ..u seem 2 b so childish ..y do u compare urself 2 india US russia ..remember u r a pakistani...u dont pay taxes the way indians do and our country is nt dt strong..so think b4 u compare...
The visit of President Zardari to Russia at a crucial time when PAK-US relations are at lowest -level is very interesting, indeed. It seems new alliances are being made - Pakistan moving towards Russia and India towards US.
its so shameful to see that presidents, prime minister and all cabinets make 30 trips to china every year, and newly got russian visa to make trips there frequently. These guys would be laughing at us privately to see how fearful, disillusioned, opportunist, and beggars to the core can a nation be. Have anyone seen Obama, Putin, Hu Jintao, Manmohan make any useless visit to same place hundred times every year????
I don't know what's stopping them?? If they can bring China and Russia into this, the two super powers can make USA enter Pakistan into that exemption list in which they recently added India. That will be a real big achievement of PPP.