The multi-billion-dollar gas pipeline is meant to export a daily amount of 21.5 million cubic meters of Iranian natural gas to Pakistan.
China has agreed to finance the part of the Iran-Pakistan (IP) gas pipeline project that runs on Pakistani soil, a report says.
The agreement was reached during a recent visit by Pakistani President Asif Ali Zardari and Minister for Petroleum and Natural Resources Asim Hussain to China, Pakistani daily Today
Quoting an unnamed official, the daily said that a Chinese company was likely to participate in the construction of the IP pipeline.
The official described the agreement as a big achievement, since Chinese participation in the project would ensure its safety, adding that Iran had already assured Pakistan of providing all the financial and technical assistance for the commissioning of the pipeline.
The cost of the project on the Pakistani side is estimated at USD 1.2 billion.
Energy-hungry Pakistan is looking to increase its fuel imports from various sources, including Iran, to reduce power shortages that have crippled the country’s industries and shaved percentage points off its GDP growth.
In addition to importing oil from Iran, Islamabad has been in talks with Tehran over the construction of the IP gas pipeline which would transfer Iranian natural gas to Pakistan.
The multi-billion-dollar gas pipeline aims to export a daily amount of 21.5 million cubic meters (or 7.8 billion cubic meters per year) of Iranian natural gas to Pakistan.
The maximum daily gas transfer capacity of the 56-inch pipeline, which runs from Asalouyeh in Bushehr Province to the city of Iranshahr in Sistan and Baluchestan Province, is around 110 million cubic meters.
Iran has already constructed more than 900 kilometers of the pipeline on its soil.