FWO seeks 4-year payback for $432m Azeri-funded pipeline

Pakistan’s Frontier Works Organisation is seeking to recover about $432 million invested in a proposed 437-kilometre white oil pipeline within four years. The plan relies on a guaranteed transportation tariff intended to secure the participation of Azerbaijan’s state oil company, Socar.

The proposed Faisalabad-Peshawar pipeline would carry petroleum products from Faisalabad to Thalian, near Rawalpindi, and then onward to Tarujabba, near Peshawar. The federal government supports the project.

Under a tariff petition filed with the Oil and Gas Regulatory Authority, transportation costs would start at about $64 per tonne in the first year, targeted for 2029. The tariff would gradually fall to $14.5 per tonne by 2058, the final year of the proposed 30-year tariff period.

Ogra has published the 3,033-page petition alongside the project’s Front-End Engineering Design and a volume stability report. The filing seeks to establish the tariff structure needed to recover the investment and facilitate Socar’s involvement.