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Iran seeks Pakistan's response on gas pipeline project to India

ISLAMABAD: Iran has asked Pakistan government for an immediate response on the fate of its proposed gas pipeline project to India, sources in the Ministry of Petroleum and Natural Resources said on Wednesday.

Sources said Iranian authorities had formally written to the authorities in Islamabad enquiring whether they had arrived at a decision on the fate of the project, which could fetch up to $600 million in transit fees for Pakistan every year.

Sources said the official communication to authorities in Islamabad urged them to reach a final decision at the earliest stating that an early decision on the project suited Pakistan's interests as well. These officials said there was no mention of an increase in the proposed transit fee in the official communication.

However, they confirmed that the Pakistan government had been informed that Iran was willing to increase the transit fee in exchange for Pakistan government's assurance that the project will not be abandoned.

Sources said the Petroleum and Natural Resources Ministry had finalised report on the proposed project and will present it to the Chief Executive for approval.

Iranian authorities proposed the project in early 1990s when major oil and gas deposits were discovered in its territory adjoining Gulf state of Qatar. Iran decided then that the reserves were huge enough for it to export gas to Pakistan and India. However, the project failed to take off due to Islamabad's reluctance to allow its territory for supply of natural gas to India.

The proposed gas pipeline project will need a tripatite agreement among Iran, Pakistan and India.

Iran signed an 'in-principle' preliminary deal with India in February 1999. Fortuna