Pakistan to seek undertaking from Iran on gas pipeline

In a bid to address US concerns about the Iran-Pakistan gas pipeline, Pakistan plans to seek an undertaking from Iran that the project's proceeds will not be used for nuclear proliferation, a media report said today.
Despite Iran's recent nuclear deal with Western powers, the US has said it has not changed its stance on the pipeline project.
Pakistani authorities, acting on the advice of legal expert Ahmer Bilal Soofi, plans to seek an undertaking from Iran that it will not use proceeds from the pipeline for nuclear proliferation, The Express Tribune quoted its sources as saying.
According to Soofi, the global sanctions regime against Iran is based on a "presumptive association" between its energy revenues and its nuclear programme.

With the US having listed the National Iranian Oil Company as a proscribed entity, its involvement in the project may invite US sanctions and trigger similar EU sanctions as the Europeans tend to follow the Americans, the report said.
Pakistan's Attorney General has suggested that a US-based international law firm should be engaged to evaluate the project before it gets rolling in 2015.

Due to the threat of US sanctions, Pakistan faced problems in securing funds for the project and the government had asked Iran to finance the Pakistani section of the pipeline.
During the previous Pakistan People's Party-led government, Iran committed to provide USD 500 million to finance the Pakistani section but the current PML-N government wants Iran to enhance the credit limit.

The cost of the project has been estimated at USD 1.8 billion and the government had decided to award the contract for engineering and construction to Tadbir Energy, an Iranian firm.
Pakistan plans to import 750 mmcfd of gas from Iran, extendable to one billion cubic feet of gas per day.
According to an unnamed Foreign Office official, the Americans had objected to the "intent" of the pipeline and any finer distinction would not cut much ice with them.
The official said the region's geo-strategic dynamics, including the situation in Afghanistan, turmoil in the Middle East, the wider problem of global terrorism and the pervasive anti-Americanism in Pakistan, would be important considerations in US calculations regarding the pipeline.