Pakistan may face sanctions by doing business with Iran | World Defense

Pakistan may face sanctions by doing business with Iran


Nov 28, 2014
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United Arab Emirates
State Minister for Petroleum and Natural Resources Jam Kamal on Tuesday said that Pakistan would not pay any penalty to the neighbouring country over failure to start the Iran-Pakistan gas pipeline project by this year’s end.
During the parliamentary delegation meetings of the both countries recently, Pakistani side apprised Iranian counterparts that Pakistan wants to start the project but due to sanctions on Iran, it is just waiting for the right time, said state minister for petroleum Jam Kamal while talking to media. He said in case Pakistan start the pipeline project it may have to face same sanctions, as some countries faced due to doing business with Iran.
“I can’t tell you till exactly for how much time the penalty date has been extended.”
He said a meeting between Iran and Pakistan is due in coming days, where all other details are expected to be chalked out, he said. Answering a question, Kamal said that Pakistan has not scrapped the project but Pakistan would not lay gas pipeline on its side until sanctions on Iran are not lifted. “150 companies which have been doing business with Iran have been fined,” he said. Kamal said that the agreements which were inked before imposition of sanctions on Iran are still intact. United States has been showing concerns on the pipeline project between Iran and Pakistan, and reportedly, in lieu of this project, USA is assisting Pakistan to buy LNG from Qatar. USAID has appointed a consultant in Pakistan to assist Pakistan’s Ministry of Petroleum in negotiating with international LNG producers.
Earlier, while answering the questions of senators in the senate standing committee on Petroleum and Natural Resources meeting, the state minister denied reports that his ministry was set to impose any new taxes on petroleum products.
“We are not planning to impose any new tax, if FBR has any plans, I cannot comment on that,” Kamal said. The senators observed that the government was not passing on the benefit of decline international oil prices to the nation. The prices have been almost been halved in the international market in last couple of months but the government has not passed on the benefit to the nation, the senators said.
During the meeting, senators’ rep remanded petroleum and gas companies for ruining the roads and infrastructure of areas with their heavy machinery movement, and over not giving employment to locals. “There is a strong resentment in locals. During the senators visit to oil fields in Sindh, the locals staged a protest. If the companies would continue to ignore locals, any law and order situation could arise. The sit-ins would be eminent, said Senator, Mukhtar Ahmed Dhamra.
The committee was informed that royalty has been given by companies and now it was responsibility of the provincial government to spend the amount on development, education and health, in oil and gas producing areas. “We have provided Rs123.7 million as royalty to Sindh government, said Arshad Mirza, additional secretary ministry of petroleum and natural resources. Mirza, who is also heading the PPL (additional charge) informed the committee that oil and gas reserves have been discovered in Gmabit. “Some have been announced recently and some would be announced soon.”
During the meeting, the private oil companies informed the senators that some of them said that they have been spending under the policy devised by the Ministry of Petroleum.
During the meeting, ministry had called a large number of private oil companies to answer the questions of senators. But during the meeting it was revealed that it was the weakness in policies and implementation on part of Ministry of Petroleum that the oil and gas companies paid their share for the local development as per their agreement but the amount was not spend.
OGDCL was also found not employing locals as per policy guidelines. The senators also reprimanded MD, OGDCL for presenting false figures.
Senator, Mukhtar challenged the MD, that no road project has been initiated in Sanghar, whereas the MD was telling senators that construction of three roads has been started in the area.
Pakistan may face sanctions by doing business with Iran