{"id":20083565,"date":"2022-02-24T15:08:38","date_gmt":"2022-02-24T09:38:38","guid":{"rendered":"https:\/\/www.thethirdpole.net\/?p=83565"},"modified":"2022-02-25T20:57:30","modified_gmt":"2022-02-25T15:27:30","slug":"pakistan-gas-pipeline-dominates-imran-khan-russia-trip","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/energy\/pakistan-gas-pipeline-dominates-imran-khan-russia-trip\/","title":{"rendered":"Renewables on the burner as gas pipeline dominates Imran Khan\u2019s Russia trip"},"content":{"rendered":"\n

Pakistani Prime Minister Imran Khan\u2019s arrival in Russia<\/a> has been dramatically overshadowed by Russian forces entering Ukraine. The geostrategic consequences for Pakistan of the two-day visit<\/a> to Moscow, the first by a Pakistani premier in 23 years, are likely to be analysed through the hardening stances of the many actors in the current conflict. The long-term consequences, though, have almost everything to do with the future of natural gas.<\/p>\n\n\n\n

Khan’s visit comes just after Germany, the largest consumer of Russian gas, halted<\/a> certification of a new Nord Stream 2 pipeline. Russia recently agreed upon a 30-year<\/a> contract to supply gas to China, coinciding with President Vladimir Putin\u2019s visit to the Beijing Winter Olympics. As Russia seeks new clients for its construction technology<\/a> and fossil fuels, and with Pakistan desperate for a secure and cheap supply of natural gas, the visit could lay the foundations for Russia building a pipeline to transport natural gas from Karachi to Lahore.<\/p>\n\n\n\n

Russia is the world\u2019s second biggest producer of natural gas. Meanwhile Pakistan, with declining gas reserves, faces a major supply problem<\/a> as gas still makes up a substantial part of its energy mix.<\/p>\n\n\n\n

Pakistan\u2019s energy minister, Hammad Azhar, speaking to The Third Pole, said the trip is only an \u201copportunity to learn the technology\u201d of laying a gas pipeline from the Russians, whom he says are the best in the business. Pakistan wants to construct a 1,100-kilometre gas pipeline, known as the Pakistan Stream Gas Pipeline Project, from Port Qasim in Karachi, in Sindh, to Kasur in Punjab. The USD 2.5 billion project is tentatively slated to begin next year, though an initial agreement was first signed in 2015 and a second in 2021.<\/p>\n\n\n\n

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Graphic: The Third Pole<\/div><\/div><\/div><\/div>\n\n\n\n

\u201cWe don\u2019t have the expertise of the scale and size that is needed for this project,\u201d Azhar told The Third Pole over the phone from Islamabad. \u201cThe project will remain majority-owned [74%] by Pakistan to begin with, so it could be a win-win,\u201d he said.<\/p>\n\n\n\n

Former prime minister Shahid Khaqan Abbasi, who envisioned the project in 2013 when he was minister for petroleum and natural resources, held a similar view. The project had remained dormant due to various \u201cfinancial bottlenecks\u201d, said Abbasi.<\/p>\n\n\n\n

\u201cMy fear is that this government will face the same hurdle we did and will be unable to justify the build-operate-transfer price structure of how much to pay the Russians for the amount of gas that flows through the new pipeline,\u201d warned Abbasi, referring to a model under which large projects are financed and developed through public-private partnerships.<\/p>\n\n\n\n

Increasing demand, decreasing supply<\/h2>\n\n\n\n

Pakistan\u2019s production of natural gas peaked in 2009, according to the International Energy Agency, but gas has continued to increase as a percentage of total energy supply steadily since then. This has led to a slow-moving crisis as Pakistan scrambles to make up the difference.<\/p>\n\n\n\n

Major cities increasingly face prolonged gas outages, hitting both residents and businesses hard. In December last year, the government said<\/a> the country will soon run out of local gas, therefore increasing reliance on expensive imported gas.<\/p>\n\n\n\n