Currently, they said, Pakistani and Russian experts were in the process of holding negotiations on Build-Operate-Own-Transfer (BOOT) agreement to lay the pipeline for which the two countries had signed an inter-governmental accord on October 16, 2015. The project, costing around US$2 billion, faced some delay due to some international sanctions on Russian company RT-Global Resources.
Inter State Gas Systems (Private) Limited (ISGSL) from Pakistan side and RT-Global Resource (RTGR) from Russian side were designated as the entities responsible for the project and negotiating the BOOT agreement, the sources said. Meanwhile, the US government had imposed Ukraine related sanctions on the Russian Federation.
The RT-GR is included in the Sectoral Sanctions Identification List maintained by the Office of the Foreign Assets 25 Control. "Given this, the Russian side proposed to implement the Project through Project Implementation Company to be incorporated under the laws of Pakistan. The matter was referred to the Law and Justice Division which opined that the proposal of the Russian side may be considered, as long as the Project Implementation Company is not hit by the US sanctions while maintaining the majority of Russian ownership," they remarked.
Under the project, around 12.4bcm (billion cubic meters) of gas would be transported per annum through a 42 inch diameter pipeline, they said and described the pipeline of great significance for Pakistan to supply Liquefied Natural Gas (LNG) to consumers in an efficient way.