PD rejects news about Law Ministry’s denial for clearing North-South gas pipeline project

January 13, 2020: A spokesman of Petroleum Division Monday rejected a news item appearing in a section of media about Ministry of Law’s denial to clear the North-South Gas Pipeline Project.

“The Ministry of Law and Justice has not denied clearance on the proposed structure of the project implementation consortium of North-South Gas Pipeline Project. Rather, the legal opinion was sought from the Office of the Attorney General for Pakistan on the advice of Ministry of Law & Justice,” he said in a press release.

The spokesman said an Inter-Governmental Agreement was signed on October 16, 2015 between Pakistan and Russia for implementation of North-South Gas Pipeline Project (NSGPP) from Karachi to Lahore.

“Since the Russian nominated entity RT-GR is sanctioned by the US Government, therefore, the Russian Ministry of Energy suggested a new project company comprising, PAO TMK and Russian State-Owned company Zarubezhneft JSC (20% +1 share) and/or their affiliates, associates or subsidiaries.” The spokesman said the Ministry of Energy (Petroleum Division) recently received a letter from the Russian side informing about “replacement of the earlier proposed project company and assigning of the project realization rights to the project company North-South Gas Pipeline (Pvt) Limited.” The ministry, he said, had sought further details from the Russian side and invited them to visit Pakistan during this month to discuss and move ahead on the implementation of the project.

Given the fact that the North-South Gas Pipeline Project would serve as a vital component of energy security of the country, he said it had been the stance of this Ministry that the project implementation consortium should be Russian majority, having pipeline building experience. Besides, the companies/persons included in the consortium should not “on the sanctions and on sanctions watch list” to avoid jeopardizing the implementation of the project.

He said it would be a flagship strategic project in the energy sector of Pakistan, symbolizing a long term mutually beneficial economic cooperation between Pakistan and Russia. “Therefore, a sound project structure meeting these requisites will be in the interest of both countries,” the spokesman said, adding there was no particular Russian Company to be sided with by the Ministry.

“We will welcome the project implementing consortium with the understanding that the structure is of sanction-free entities/persons with pipeline building experience”, the spokesperson emphasized while clarifying the stance of the ministry.

APP