Iran reiterates backing for Pakistan gas pipeline

Iranian ambassador Mohammad Ali Hosseini has reiterated Tehran's support for a $7bn gas pipeline project that would deliver fuel to gas-starved Pakistan, national newswire Associated Press of Pakistan (APP) reported September 7.

Hosseini also expressed support for strengthened cross-border trade, including a potential free trade agreement and collaborations at major trading ports.

"Both Pakistan and Iran are geographically very important countries and our mutual cooperation is of the utmost importance for our geo-economic interests."

Pakistan continues to suffer regular electricity outages, despite efforts to spur domestic gas output from onshore assets, mostly situated in Sindh province to the country's southeast, due to the high cost of global LNG supplies. Bi-lateral talks on the IP pipeline started in 1995 with the aim of linking Iran's South Pars gas field to Pakistan's largest city, Karachi.

Despite Tehran finalising its share of the route in 2011, and $500mn being offered to finish Pakistan's part of the pipeline, Iran's intermittent feud with the US has led the White House to strongly lean on successive Pakistan governments to pull out of the deal, according to German current affairs publication DW.

Under the threat of US sanctions due to Iran's nuclear programme, Pakistan backed out of the project in 2019.   The scheme has also floundered due to the need to find inter-governmental agreements that would allow pipes to be laid through third-party territories to make the project economically viable.

Tehran once envisioned the pipeline continuing into India, and has also sought support from China, but has failed to secure any commitments from Beijing. As recently as July, Tehran sought backing from Gazprom to help deliver the project, focusing on a Pakistan to New Delhi route, though with the situation in Ukraine this would likely result in renewed sanctions threats from the US.