Tehran: Iran has issued a final warning to Pakistan to complete its section of the cross-border gas pipeline or risk international arbitration and potentially face billions of dollars in penalties. According to a Nikkei Asia report, Tehran’s warning is the latest escalation in the long-standing dispute over the 1,900-kilometer pipeline, a project vital to Pakistan’s energy future as its own gas reserves are expected to deplete in just over a decade.
Iran has said it invested $2 billion in building its 1,150-km section of the pipeline, which was inaugurated in 2013. However, Pakistan’s portion remains incomplete due to US sanctions imposed on Tehran over its nuclear program. In February, Pakistan announced the commencement of construction on the 80-kilometer initial phase of the pipeline within its territory.
According to the report, US Assistant Secretary of State for South and Central Asian Affairs, Donald Lu, warned Pakistan in March against importing gas from Iran, which holds some of the largest reserves globally. Since then, no additional progress has been made on Pakistan’s portion of the pipeline.
Now, Iran is threatening to take the dispute to the International Court of Arbitration if Pakistan fails to meet the imminent deadline to complete the pipeline. Pakistan had requested a 10-year extension to finish the project in 2014, and this extension is set to expire this month.
