Gwadar fresh international limelight

Gwadar is all set to catch fresh international limelight capitalizing its commercial worth and geographical significance after Pakistan government has come up with proposal to shift the ‘starting point’ of the Russia’s Pakistan Stream Gas Pipeline from Karachi to Gwadar.

Development evolves in the backdrop of new emerging Pak-Russian diplomatic and economic relations. Taking advantage of situation, Pakistan has secured deal with Russia in making first purchase of cut-price Russian crude oil. With the upbeat, the discounted purchase has provided much-needed respite to cash-strapped Pakistan, which has been struggling to avert a balance of payments crisis as it awaits an IMF deal. The move will give Moscow a new outlet, adding to its growing sales to other countries – also often at a discount – as it redirects oil from Western markets following sanctions on account of Ukraine crisis.

If all goes well and decision is finalized to shift the ‘starting point’ of the Russia’s Pakistan Stream Gas Pipeline from Karachi to Gwadar, it will help resume work at the abandoned LNG Gwadar Pipeline Project that connects with Iran.

Gwadar Development Authority official told Gwadar Pro that Pakistan and Russia signed an Inter-Governmental Agreement to execute the North South gas pipeline project which was later renamed the ‘Pakistan Gas Stream Project’ to transport LNG from Karachi to Lahore 8 years back. Now as per new plan LNG transportation will be from Gwadar to northeastern province of Punjab, he added. “The Pakistan Stream gas project, also known as the North-South gas pipeline, is to be built in collaboration with Russian companies,” he added.

Chances are very bright in making things happen as apprehensions to offset the development have died down after the US greenlighted Pakistan for not minding Pak-Russian oil deal.

Pakistan’s Ambassador to the United States Masood Khan said while addressing a conference on “The Future of Pakistan-US relations” at the renowned US think-tank Wilson Centre, that Islamabad “consulted” Washington before signing the crude oil deal with Russia, clarifying that there is no misunderstanding between the two countries on buying oil from Moscow. Earlier, US State Department spokesperson Vedant Patel also clarified that Washington has no objection to Pakistan’s decision to import oil from Russia.

“We do not believe our relations with China should affect them in any way. We earnestly hope that the US, the shining city upon a hill, and China, an emerging power, using their statesmanship, will opt for cooperation and competition rather than confrontation that can plunge the globe into strife or worse,” he said. Khan said:

Gwadar Port Authority official said that Gwadar has competent potential to be starting point of a 1,100 km (683 mile)-long pipeline to deliver imported Liquified Natural Gas (LNG) from Gwadar port to power plants in the northeastern province of Punjab.

The pipeline’s designed annual capacity stands at 12.4 billion cubic metres (bcm), with the possibility to be increased to 16 bcm. The project was to be launched in 2020, but Russia had to replace the initial participant after the company was hit by western sanctions not related to the Pakistan Stream project. Currently, situation has changed as Pakistan and the US are on same page.

Similarly, Pakistan petroleum ministry is very optimistic that with the change of starting point of the Pakistan Gas Stream Pipeline from Karachi to Gwadar. Gwadar LNG pipeline will also see the light of day.

Pakistani company Inter State Gas Systems (ISGS) and Chinese companies had already worked on the Gwadar LNG pipeline which was supposed to connect to the Iranian border to complete the Iran Pakistan (IP) gas pipeline project.

President of Institute of International Relations and Media Research