Pakistan and Russia on Friday signed an inter-governmental agreement for the construction of a gas pipeline from the southern port city of Karachi to Lahore, the capital of Punjab province, officials said.
Russia will make an investment of 2 billion U.S. dollars in the project, the first phase of which will be completed by December 2017. The 1,100 km pipeline with a capacity of 12.4 bcm per annum will connect liquefied natural gas (LNG) terminals of Karachi with those of Lahore.
Pakistan Petroleum Minister Shahid Khaqan Abbasi and Russian Energy Minister Alexander Novak signed the agreement in Islamabad. Prime Minister Nawaz Sharif also attended the signing ceremony.
The deal was finalized earlier this year during the visit to Moscow by the Pakistani petroleum minister. Reports suggested Pakistan is working on two pipelines to transport regasified LNG from Karachi to the northern parts of the country.
The first pipeline will connect Gwadar Port in southwestern Balochistan to the main natural gas pipeline hub in Nawabshah in southern Sindh province, while the second will connect Karachi to Lahore.
Officials in Pakistan said the agreement marks the Russian involvement in a first major project in Pakistan in nearly 40 years.
A subsidiary of the Russian state corporation Rostech will be the partner of the Pakistan-owned Inter State Gas Systems (ISGS).
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