Pakistan faces $18 billion penalty threat over violation of international agreement
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"In Pakistan, officials in the Law Division have initiated discussions on how to restructure the Iran-Pakistan (IP) gas pipeline project to mitigate the impact of US sanctions and avoid the $18 billion penalty sought by Iran.
The proposed approach involves Pakistan not directly purchasing gas from Iran but instead using a third-party intermediary or a powerful nation to bypass US sanctions. Iranian authorities are also involved in these deliberations.
The caretaker Energy Ministry was questioned about these efforts, but no response was provided. Pakistan has been cautious in implementing the project due to concerns about US sanctions against Iran. Iran maintains that there are no sanctions on gas trade and pipeline construction within Pakistan's territory.
In January 2023, Iran formally requested that Pakistan complete a portion of the IP gas line project within its territory by February-March 2024 or face the $18 billion penalty.
This request was made during Pakistan's delegation visit to Tehran in November-December 2022. Iran has already completed a section of the pipeline within its own territory, extending from the gas field to the Pakistan border."
