ISLAMABAD, Dec 28: Pakistan and Iran are expected to approve on Tuesday a pre-feasibility study on a $2 billion gas pipeline between the two countries, Dawn has learnt.

A six member Iranian delegation led by deputy minister for international affairs Mohammad Nejad Hossenain arrives here on Monday on a two-day visit to brief Pakistani authorities on the two-phased pre-feasibility study.

Petroleum Secretary M. Abdullah Yousaf would lead the Pakistani team, that would include the heads of the Sui Southern and Sui Northern Gas Pipelines.

The study has been completed recently by the Australian firm BHP. The first phase of the study covered gas pipeline from Iran’s south Pars gas field to Pakistan and the second involved its extension to India, sources said.

The two sides had agreed during the visit of Prime Minister Mir Zafarullah Khan Jamali to Iran in October to constitute a working group to pursue the project and sort out its technical details.

Mr Yousaf said the BHP has submitted to the Iranian authorities the pre-feasibility study that would be discussed during the two-day working group meeting.

He said Pakistan would also like to know about any proposals the Iranian side might have to take the project forward.

He said Pakistan would inform the Iranian delegation about its gas demand and supply projections for the next 20 years.

Responding to a question, he said the national gas supply companies were capable of laying the pipeline within the country’s territory but the issue could be discussed at a later stage.

Officials said the project could be the most economical option for gas import provided Iranian and Pakistani companies laid pipelines inside their respective borders.

The cost of the project as calculated by the SSGC is about $2 billion while according to Iranian authorities it may cost up to $3.2 billion.

Pakistan is expected to get $500 million annually if the pipeline goes up to India and $200 million per annum will be saved by getting cheaper gas from the project.

Studies carried out by Iran and India have shown that an offshore pipeline between them is not feasible and it has been established that it could be laid only through Pakistan.