ISLAMABAD: Pakistan and Russia on Friday signed an agreement on laying a 1,100-kilometre-long pipeline from Karachi to Lahore with Russian investment of $2 billion.

The agreement on cooperation for the development of North-South Gas Pipeline was inked by Federal Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi and Russian Minister for Energy Alexander Novak here at the Prime Minister’s House. Prime Minister Nawaz Sharif witnessed the signing ceremony.

Under the inter-governmental agreement, the Russian Federation through its state corporation RT Global Resource will collaborate with Pakistan’s Inter State Gas System (Pvt) Ltd for laying of the pipeline.

Shahid Khaqan Abbasi told APP that the project was of great significance for Pakistan as it will help carry the additional volume of imported gas from the country’s south to the rest of the country. He said the pipeline would develop a proper mechanism for the transportation of gas from south to other parts of the country for which no system existed at present.

The minister said the North-South pipeline project was part of the government’s vision to meet the country’s energy needs on priority basis.

He said China was also expected to collaborate in execution of the gas pipeline project, which will be completed in 30 months. The project will be capable of transporting 1.2 billion cubic feet of gas from Karachi to Lahore by laying 42-inch diameter pipeline. The first phase is expected to be completed by December 2017.

The Economic Coordination Committee (ECC) had approved the North-South Gas Pipeline Project under a government-to-government agreement in January 2015. The draft inter government agreement was approved by Prime Minister Nawaz Sharif in July 2015.

The ECC had designated the Inter State Gas System (Pvt) Ltd as the executing agency to implement the project in liaison with the Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited

(SSGCL).

The project will take cooperation between Russia and Pakistan “to a new level”, Novak said in a statement issued by the ministry.The statement said the pipeline will be operated by the manufacturer for 25 years before being transferred to the Pakistan government.

Russia’s ITAR-TASS news agency reported in June that the country had lifted its embargo on arms supplies to Pakistan and was holding talks on supplying Islamabad with combat helicopters.

Nawaz Sharif at the time invited Russian companies to invest in Pakistan, particularly in the energy sector, and benefit from the business-friendly policies of the government.Earlier, Nawaz Sharif said during a meeting with the Russian delegation led by Alexander Novak that the growing Russian cooperation would help a great deal in meeting Pakistan’s energy requirements.

This is the first such visit by a Russian energy minister to Pakistan in three decades.Both the sides reviewed the overall state of bilateral energy cooperation between the two countries, the possibility of greater Russian investment in Pakistan’s oil and gas sector and exchanged views on the North South Gas Pipeline project which would mark a new milestone in their bilateral energy cooperation.

During the meeting, the Russian energy minister expressed the hope that his visit would pave the way for enhanced energy cooperation between the two countries.Other members of the Russian delegation included Executive Director Kulikov SA, General Director of RT Global Resources Korobov AV and other senior energy and technical experts.

From the Pakistan side, the meeting was attended by Shahid Khaqan Abbasi, Minister of State for Petroleum Jam Kamal, Special Assistant to PM Tariq Fatemi, Secretary Petroleum Arshad Mirza and other senior officers from the Petroleum Ministry and the PM’s Office.

