Pakistan to approach US for waiver of sanctions on project: Musadik


ISLAMABAD  -  Petroleum Minister Musadik Malik on Monday confirmed that Pakistan is preparing to for­mally approach the US admin­istration for seeking waiver of sanctions on the Pakistan-Iran gas pipeline project.

“We will seek exemptions from American sanctions as the Pakistan-Iran gas project can­not bear the burden of embargo sanctions,” said Petroleum Min­ister Musadik Malik in unofficial talks with the media here.

“We will present Pakistan’s case comprehensively and will try to seek exemptions by pre­senting political and technical reasons against American sanc­tions,” Malik said.

The government will also en­gage in extensive lobbying to obtain the waiver, he added.

The minister hoped that con­struction of the project would commence soon.

It is noteworthy that the inter­im government had earlier ap­proved the construction of an 80-kilometer pipeline on Paki­stani soil. However, the plan to file the request for exemption from American sanctions was delayed by the caretakers due to evolving geopolitical circum­stances. Decisions regarding the Pakistan-Iran gas pipeline pro­ject were made by the ministe­rial oversight committee. A fi­nal draft requesting exemption from American sanctions has been prepared by the then gov­ernment.

On the question regarding the proposed hike in natural gas prices by the Sui Companies, Musadik said that we have con­cerns over increase in gas pric­es. Whether the dollar price de­creases or increases, requests for price hikes come from com­panies, he added.

Malik further said that only 25 to 27 percent of urban are­as have access to pipe gas facili­ties. More than seventy percent of the population does not have any access to this facility. The gas price hike affects only 25 to 27 percent of the population, he claimed.

However, he said that 99 per­cent of the population is con­nected to the electricity system. Supplying cheap electricity is the solution to the problem, the minister added.

The generation cost of the LNG plants between Rs22 to Rs26 per unit, while generating electricity from local gas reduc­es the cost to Rs10 to Rs12 per unit. To conserve gas, we have to provide cheap electricity to the people, the minister said.

Musadik Malik said that im­port of oil is being carried out through private channels from Russia. The captive power plants are being discouraged, he added.

To a query about the imple­mentation of sales tax on petro­leum products, he said “I am not aware of the implementation of sales tax on petroleum prod­ucts.”

He said that six LNG power plants are extremely efficient. These plants can be operat­ed on imported gas to produce cheap electricity. The minis­ter said that the circular debt in the energy sector has reached to Rs5 trillion. Reforms will be needed to tackle the menace of circular debt, he said.

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