Rus­sia to in­vest $2b in gas pipe­line

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Rus­sia will in­vest a whop­ping $2 bil­lion in Pak­istan to build a 1,100-kilo­me­tre pipe­line from south­ern port city of Karachi to La­hore to trans­port liq­ue­fied nat­u­ral gas.

“Pak­istan and Rus­sia have fi­nal­ized an LNG pipe­line deal in a re­cent meet­ing in Moscow and the two coun­tries will sign a gov­ern­ment-to-gov­ern­ment ba­sis deal next month,” Petroleum Min­is­ter Shahid Khaqan Ab­basi was quoted as say­ing by a lo­cal news­pa­per.

Ab­basi said that in re­turn for the in­vest­ment, Rus­sian com­pa­nies will be awarded the con­tract to build the pipe­line.

The for­mal agree­ment be­tween the two sides is ex­pected to be signed next month, fol­low­ing which Pak­istan will also sign a com­mer­cial agree­ment with a Rus­sian firm that Moscow will iden­tify as its pre­ferred con­trac­tor to build the pipe­line.

The fi­nanc­ing for the LNG pipe­line comes as a pre­lude to Rus­sia’s of­fer to sell LNG to Pak­istan. Ac­cord­ing to the agree­ment, the con­tract will be awarded with­out any for­mal bid­ding process.

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