US welcomes Chinese projects, not Iranian
By Khaleeq Kiani | 4/30/2015

ISLAMABAD: The United States has welcomed the proposed multi-billion dollar Chinese investment in Pakistan`s energy sector but asked the government to put on hold the gas pipeline project until sanctions against Iran are lifted after it reaches a final agreement with global powers on nuclear issue.

`As long as an agreement is not reached, sanctions are in place against Iran and, therefore, Pakistan should hold off any project like IP till removal of sanctions, US State Department`s Special Envoy for Energy Amos Hochstein said here on Wednesday.

`Iran and global powers are negotiating -moving to a final deal,` he told reporters after a meeting of the US-Pakistan Energy Working Group.

He said Pakistan had said during the second round of the working group`s discussions under a broader strategic dialogue framework that three power distribution companies would be privatised next month.

Mr Hochstein said the US supported the privatisation programme, particularly of energy companies, because it would attract investment and make the sector efficient in view of the experience with the sale of the K-Electric.

He welcomed planned Chinese investment in Pakistan`s energy sector under the Pakistan-China Economic Corridor and expressed hope that the project would move forward.

`We strongly believe that Pakistan should achieve energy security,` he said.

Answering a question about lower US investments compared to China`s, he said: `We are a different country and not in competition with China. China has its own policy to support its neighbour and we do things in our own way.` He said the US was extending support to enhance expertise and infrastructure -backbone of the energy sector in Pakistan.

He said Pakistan required different kinds of investments to solve its energy problem.

He said discussions were also held on Turkmenistan Afghanistan-Pakistan-Iran (Tapi) gas pipeline and Central Asia-South AsiaCasa-1000 power import projects and the US supported regional cooperation.

Replying to a question, he said the US private sector was independent and Pakistan could purchase LNG if it wanted to do so.

He said LNG was going to be a game-changer for Pakistan to ensure energy security.

The US was going to become an LNG exporter next year because of reforms in the energy sector, he said.

He said the gas price in the US is $2.60 per million British thermal units.

He said Pakistan should improve its energy basket by generating power through wind, solar, hydro and gas resources.

He said it was stated during the talks that Pakistan would add 3,000 megawatts of electricity through various renewable resources during the next three years.

The US envoy said Pakistan was going to install domestic and imported coal-based power plants but warned that investment in such plants was not good for the future.

He said Pakistan planned to conduct studies on environmental and financial issues related to the $15 billion Diamer Bhasha dam project needed to meet the requirements of international lenders that it would be technically sound.

He said the oil price reductions had created challenges also for US energy companies as the world had expected a price of around $100 per barrel but it fell down by almost half of that.

He said Pakistan, being an oil importer, had the opportunity to invest in various sectors of economy while the prices were down and at the same time announce incentives for exploration companies to add to the indigenous gas production.

Energy demand in Pakistan is expected to double by 2020 and the country should institute reforms to create support from the private sector and also from other countries and institutions.

Mr Hochstein said the strategic dialogue initiative marked a new phase of US assistance to Pakistan, contributing over 1,500MW since 2010 by refurbishing hydropower and thermal generation facilities, completing hydropower projects and improving the operation and efficiency of the transmission and distribution system.

Published in Dawn