September 27-2013
Russia has offered to help finance the pipeline designed to distribute Iranian natural gas across Pakistan, a potential game changer.
The Pakistani English language daily The News said the offer was made last Wednesday by Russian Deputy Energy Minister Yury Sentyurin while he as in Pakistan.
The report said both sides had decided that Pakistan would draft a proposed agreement and submit it to the Russians.
The report didn’t say if Russia offered any particular amount of financing, a crucial element. Nor did it say anything about the terms, such as interest charges.
The pipeline is expected to cost between $1.5 billion and $1.7 billion. Iran is providing $500 million in financing, but has refused to go beyond that. Pakistan has made no financial commitment at all. And years of searching for outside support has produced nothing beyond Iran’s $500 million.
The United States opposes the gas pipeline and wants Pakistan to get natural gas from other sources. But US efforts to pin down other sources for almost a decade have drawn a blank.
The Russian offer is seen by many as less economic than political—another shot in President Putin’s efforts to cause trouble for US policy around the world.
Iran has built most of the 900-kilometer pipeline across southern Iran from the Persian Gulf coast to the Pakistani border. The pipeline is supplying gas to numerous communities in the Iranian south that did not previously have access to gas.
A pipeline extension of 700 kilometers is to take the gas from the border to the densely populated parts of Pakistan. That pipeline was inaugurated March 11, just before the Pakistani parliamentary elections, to try to show the government’s dedication to solving the country’s energy shortage, which produces many blackouts.
The government, however, lost the election, and the pipeline has not progressed much from the border.