Collaboration between Pakistan and Russia on the Stream gas project

On Wednesday, Pakistan’s Prime Minister Imran Khan will travel to Moscow to meet President Vladimir Putin. They will discuss issues such as economic cooperation and the long-delayed pipeline of gas that is vital for the country’s economy.

In collaboration with Russian companies, the Pakistan Stream gas project (also known as the North-South gas pipeline) will be constructed.

“Both countries are eager for the project to be launched at the earliest,” a Pakistani energy ministry spokesperson told Reuters Wednesday, ahead of Khan’s two-day visit.

PAKISTAN STREAM

  • Russia and Pakistan reached an agreement in principle in 2015 to construct a 1,100 km (683 miles) long pipeline to transport Liquified Natural Gas (LNG), from Karachi, on the Arabian Sea Coast to power plants in the northeastern Punjab province.

The planned annual capacity of the pipeline is 12.4 billion cubic meters (bcm), but it could be increased to 16bcm.

According to Russia, the cost of the project will be between $1.5 billion and $3.5 billion. Pakistan estimates that 26% of this amount will come from Moscow, while 74% of it will be funded by Islamabad.

  • The project was supposed to launch in 2020. However, Russia was forced to replace the original participant due to western sanctions that were not connected to the Pakistan Stream project.

The Russian Energy Ministry runs the Operational Services Centre and the Eurasian Pipeline Consortium. This is a rare instance of Russian participation in a pipeline project. Russian shareholders hope to get back their investment from gas shipping fees.

Currently, feasibility studies on the project are being conducted but no date has been set. Russian media reports that the Pakistan Stream shareholder agreement should be signed by this month.

  • The agreement to build the Pakistan Stream gas pipe was signed by Shafqat Ali Khan, Pakistan’s Ambassador in Moscow, and Nikolai Shulginov, Russian Energy Minister.


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