A deal on LPG and LNG is likely to be signed during the scheduled visit of President Asif Ali Zardari to Russia commencing May 11 (today). Well-informed sources said the deal might be struck subsequent to meetings between the visiting Pakistani delegation and Russian public and private sector companies in oil and gas sector.
During the President''s visit, five Memoranda of Understandings (MoUs) are expected with 5 Russian private and public companies that include Evraz S.A Russia International, Gazprom Russia International, Lukoil Russia International, Rusal Russia International and Severstal Russia International. The five MoUs would be non-binding in nature and focused on enhancing investment relations, opportunities, exchange of information and providing facilitation services to investors. These MOUs have already been vetted by the Ministry of Law Justice & Parliamentary Affairs and cleared subject to prime minister''s as well as Cabinet''s approval under Rule 16 of the Rules of Business, 1973.
The MoUs have been sent to the Embassy of Pakistan in Moscow to be shared with the Russian companies. The same are also being sent to the Prime Minister of Pakistan to get waiver from Cabinet approval under Rule 16(2) of the Rules of Business 1973. With Gazprom and Lukoil Russia International, Pakistan would discuss import of LNG and LPG so that the current high dependency on furnace oil could be reduced. Negotiations on Iran-Pakistan gas pipeline would also feature prominently on the agenda with these companies.
Gazprom and Lukoil have expertise in oil & gas exploration and production-supply of equipment/rigs, mud pump/processing plants - technology of revival of dead wells - line pipes projects - advance technology for gas supplies - LNG and LPG storage terminals.
Other viable projects and areas of investment with Russia include soft credit for expansion of project for Pakistan Steel Mills from 1.1 million tons up to 3.0 million MT per year production capacity in 3 stages. To improve the performance of Railways, purchase of 30,000 tons rail tracks, new and refurbished locomotives, railway signalling system equipped with advanced technology, as well as investment for trains operation on public private partnership would also be discussed between the two countries.
In the field of hydel power production, co-operation in importing the technology for wind power and technology for solar energy would be sought. Thar project for underground gasification and mining of iron ore, bauxite and copper and others would also come under discussion. Discussions on the possibility of Russian assistance in agriculture including manufacturing tractors, research and development for seeds production and manufacturing of pesticides with modern development and technology for modern cultivation would be held. Currently, foreign direct investment from Russia is negative. According to figures of the State Bank of Pakistan 2008-09, only $0.053 million were received from Russian which ended the subsequent year.
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