Iran Pakistan Gas Pipeline Issue: The Iranian government has issued a ‘final notice’ to Pakistan for delaying the IP gas pipeline project. Not only this, Iran has also given an open threat to Pakistan. The Iranian government’s notice states that Tehran has no option left other than going to the Paris Arbitration Court in September 2024 against Pakistan if it does not build the pipeline under the IP gas project within the stipulated time limit of 180 days.
According to The News report, the Iran Pakistan Gas Pipeline Project was to be completed by December 2014 and was to be operational from January 1, 2015. Under this agreement, Iran would lay the pipeline on its side and Pakistan would build it in its area. However, the 10-year delay has not only put this project in trouble but has also created big problems for Pakistan.
Know for which reasons the project could not be completed?
At the same time, due to the sanctions imposed by the US in 2014, this project was delayed by 10 years. The gas sale purchase agreement was signed in 2009 under French law. Any dispute related to this has to be settled through the Paris-based arbitration court. In such a situation, the special thing is that the French arbitration court does not recognize the American sanctions.
A contract was signed between Iran and Pakistan in 2019
According to the report, Pakistan’s Inter-State Gas System (ISGS) and National Iranian Gas Company (NIGC) signed the contract in September 2019. Under this, if there is a delay in the construction of the pipeline, Iran will not approach any international court. However, Pakistan will lay its pipeline by 2024, after which it will get 750 million cubic feet of gas daily from Iran.
Despite the extension of the deadline, PAK failed to lay the pipeline
Under the changed contract, Pakistan was obliged to lay the portion of the pipeline in its territory by February-March, 2024. However, Iran facilitated Pakistan and extended the deadline by 180 days. Which is to expire in September 2024, however, the authorities again failed to lay the pipeline. Hence, Iran has issued its final notice.
In such a situation, if Pakistan fails to complete this project, then it will have to pay a penalty of 1 million dollars per day to Iran from 1 January 2015. It is believed that if Iran approaches the Paris Arbitration Court, then Pakistan may have to bear a loss of billions of dollars in penalty.
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