North-South Gas Pipeline confusion: AGP clears both structures, but Russia says it will own new structure only

ISLAMABAD: In a new development, the Attorney General for Pakistan has cleared the two structures for North-South Gas Pipeline Project (NSGPP) putting Petroleum Division on tight rope on how to proceed on the project as the AGP’s clearance of the two structures have triggered more stimulation in the ongoing ‘confusion’.

One of the top officials of Petroleum Division confirmed this development saying that Russian government has intimated after the AGP’s clearance of the two structures --- the new and old one –saying that it now gives the ownership to the new structure not the old one.

Spokesman for Petroleum Division Additional Secretary Muhammad Ayub Chaudhry also confirmed to The News that the AGP has cleared the new and old structures for North-South Gas Pipeline and a meeting would be held with Minister for Petroleum Omar Ayub Khan in the chair on how to proceed for next action.

However, the official source said that Prime Minister Imran Khan will visit Russia in May and Russia wants finalisation of commercial agreement till end of March 2020 with new structure.

Earlier, a presentation on North-South gas pipeline was given to Prime Minister Imran Khan at the Prime Minister Secretariat when in he was informed that the timeline with regard to finalising and then signing of commercial agreement for North-South Gas Pipeline Project may be delayed till somewhere in May because of the ‘confusion’ over latest and previous structures for completing the project. The prime minister was also sensitised that the progress can be expedited and completed earlier once the ‘confusion’ is cleared on time as AGP has been asked to give its opinion on the new and old structures if they are in US sanctions list or watch list or not. Now under new scenario, the Petroleum Division has started experiencing more confusion after AGP has cleared the two structures.

The top official said that Russian ambassador was consulted over the new development, but he clearly told the Petroleum Division that Russian government does not stand with the old structure rather it gives its ownership to the new structure with main company called as EKT. The pipeline of over 1,100 kilometres from Karachi to Lahore would be completed in BOOT (build own operate and transfer) mode.

Earlier, the Russian energy minister urged Pakistani counterpart Omar Ayub in a letter dated February 24 to play role in expediting the approval of the amendments to the agreement as well as arranging negotiation between the nominated organisations (North-South Gas Pipeline Pvt Limited) and Inter-State Gas System (on all technical and commercial aspects of the project with an aim of signing the required commercial agreements before the end of March 2020. However, both the sides had agreed that commercial agreement would be completed and signed by mid of April, but the time line for agreement will be delayed.