Pakistan and Iran on Monday reaffirmed their commitment to an early resolution of the Iran-Pakistan gas pipeline project, emphasizing a way forward through discussions between the two sides. 

The commitment was made at a meeting in Tehran between Iranian President Dr. Masoud Pezeshkian and Pakistani Prime Minister Muhammad Shehbaz Sharif.

During the discussions, Prime Minister Sharif reiterated Pakistan's keen interest in expanding the volume of bilateral trade and economic cooperation with Iran to $10 billion. 

The latest bilateral approach to the long-standing Iran-Pakistan gas pipeline issue offers relief to Pakistan, which has not been able to complete its portion of the cross-border pipeline despite a 10-year deadline extension. 

With the agreements signed in 2009, the Iran-Pakistan pipeline project aimed to supply Pakistan with at least a billion cubic feet of gas per day from Iran’s South Pars Field by 2015.

Despite Iran completing its 900-kilometre section of the pipeline and inaugurating it in 2013, Pakistan had not advanced the project beyond signing the agreement. In 2014, a year away from the project’s deadline, Islamabad requested a 10-year extension to avoid paying hefty fines due to the project’s delay. 

However, by early 2024, the pipeline was not yet in place, prompting Iran to warn Pakistan that it was considering seeking international arbitration. The move could have resulted in Pakistan paying Iran at least $18 billion in fines. 

Pakistan officials blamed Western sanctions for the stalled project as the country feared potential U.S sanctions if it proceeded with the project. 

In March 2024, Pakistan officials approved the construction of the first phase of the project, an 80-kilometer-long pipeline stretching from the border to the key southwestern port town of Gwadar in Balochistan province.

Meanwhile, the two countries have opted to seek a bilateral solution to the long-standing Iran-Pakistan gas pipeline.