Pakistan and Russia today signed a major agreement to build a 1,100-kilometre gas pipeline from Lahore to Karachi at an estimated cost of USD 2 billion, a collaboration that is expected to take ties between the two Cold War-era adversaries "to a new level".
Russia will invest USD 2 billion in the project, the first phase of which is expected to conclude by December 2017 with the completion in 2018.
The 1,100 kilometre pipeline with a capacity of 12.4 billion cubic metre per annum will connect Karachi's liquefied natural gas (LNG) terminals with those in Lahore, the Radio Pakistan reported.
The project will be implemented in compliance with BOOT model (Build Own Operate Transfer). The pipeline will be owned and operated by the manufacturer for 25 years. After that the pipeline will be handed over to the Pakistan government.
The North-South gas pipeline project would be built by Russian company RT Global Resources, a part of Russian state corporation Rostec.
The project will take cooperation between Russia and Pakistan "to a new level", Russian Energy Minister Alexander Novak said in a statement.
Sharif, who witnessed the agreement signing by Pakistan Petroleum Minister Shahid Khaqan Abbasi and Russian Energy Minister Novak, later said the growing cooperation between Pakistan and Russia would help a great deal in fulfilling Pakistan's energy requirements.
Sharif made the remarks while meeting the Russian delegation led by Novak who called on the Prime Minister at his house here.
This is the first such visit by a Russian Energy Minister to Pakistan in three decades, the Prime Minister's Office said in a statement highlighting the growing bilateral ties between the two countries.
Both 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 which would mark a new milestone in the bilateral energy cooperation between both countries, the statement said.
The Russian Energy minister expressed hope and satisfaction that his visit would pave the way for intensive energy cooperation between both the countries.
Pakistan and Russia are deepening cooperation in various sectors as ties have been on an upward trajectory for the past few years.
Sharif and Russian President Vladimir Putin during a meeting on the sidelines of the Shanghai Cooperation Organisation summit in Ufa earlier this year discussed progress on the North-South gas pipeline agreement and had decided to expedite progress on the project.
Sharif had said that Pakistan wished to develop a multi-dimensional relationship with Russia in the fields of trade, defence, energy, infrastructure, culture and other spheres.
In August, Pakistan and Russia signed a landmark defence deal for the sale of four Mi-35 'Hind E' attack helicopters to Pakistan and are currently in talks for the delivery of Sukhoi Su-35 fighter jets.