US threatens sanctions over Iran gas deal

The United States is opposing the multi-billion-dollar Iran-Pakistan gas pipeline, and has warned that Islamabad’s continuous pursuit of the plan may invoke US sanctions.

The US Special Envoy for International Energy Affairs, Ambassador Carlos Pascual, ‘advised’ Islamabad to abandon its plan to import gas from Iran. He proposed instead that Pakistan pursue the TAPI project, a gas pipeline through Turkmenistan, Afghanistan, Pakistan and India.

The South Pars gas field in Iran is the largest in the world, meaning that its production costs for Iran are significantly cheaper than those for gas extracted from smaller fields in Central Asia, including the Caspian Sea fields to which Turkmenistan has access.

A US embassy spokesperson confirmed that Washington is concerned with Pakistan’s current direction, and the issue was raised in Ambassador Pascual’s meetings. “The proposed Pakistan-Iran pipeline, if built, could raise concerns under the Iran Sanctions Act. We are encouraging Pakistan to seek alternatives”, read a terse response from the US embassy.

However, another senior government official said that despite opposition from the US, Pakistan would not abandon the project, as an agreement has already been signed with Tehran.