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ISLAMABAD – Pakistan and Russia have developed consensus on draft Shareholders Agreement (SHA) of the Pakistan Stream Gas Pipeline Project (PSGP) and agreed to hold another round of negotiations for finalizing the SHA during the second week of November.
The 4th Russia-Pakistan Joint Technical Committee meeting of Pak Stream Gas Pipeline, held here from 25-28th October 2021.
The statement issued here at the conclusion of 4th Russia-Pakistan Joint Technical Committee said that Pakistan and Russia have successfully concluded the talks. The parties discussed the draft Shareholders Agreement (SHA) of the Pakistan Stream Gas Pipeline Project (PSGP). The Pakistan side technical committee was headed by Dr Arshad Mahmood, Secretary Petroleum Division, Ministry of Energy. The Russian Technical Committee was headed by the CEO of the Russian nominated entity, Vladimir Shcherbatykh along with the other senior officials from the Russian side. The meeting was also attended by senior officials of the AG Office, Ministry of Foreign Affairs, Ministry of Law & Justice, Ministry of Finance, SECP, OGRA, ISGS, GHPL and other senior officials from the Petroleum Division.
1,100-km gas pipeline from Port Qasim to Lahore to be completed by end of 2023 at estimated cost of over $2.5b
Having signed the Heads of Terms (HOT) in July this year, the parties held in depth discussions covering all major issues pertaining to the SHA in a cordial and congenial environment and developed consensus on key issues. Under the HOTs signed on July 15, the 1,100-kilometer gas pipeline from Port Qasim Karachi to Lahore has to be completed by the end of 2023 at an estimated cost of $2.5-3 billion.
It is worth to mention here that in August this year, at the conclusion of the technical session parleys during the Pakistan and Russia have agreed in principle to finalize the Shareholder Agreement of the Pakistan Stream Gas Pipeline Project at the earliest so that Project Company can be incorporated in Pakistan.
The parties agreed to resume negotiations in Islamabad from the week starting 8th November, 2021. Both sides have reaffirmed their unequivocal commitment towards the strategic project and resolved to finalize the SHA during the month of November as agreed earlier. The Pak Stream Gas Pipeline project is the flagship project in bilateral relations between Pakistan and Russia that have been marked by mutual goodwill, friendly and amiable relations.
It is worth to mention here that in November 2020, Pakistan and Russia had agreed to increase Islamabad’s share in the equity of renamed to Pakistan Stream Gas Pipeline to 74 percent while Moscow will fund 26 percent.
Similarly, it had also been agreed to rename the project from North South Gas Pipeline Project to Pakistan Stream Gas Pipeline (PSGP) Project. Earlier it was planned that the entire project will be executed with Russian funding, but after Supreme Court decision on the GIDC, the government of Pakistan has decided to provide maximum funding to the project.