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Pakistan·Trade & Economy·Energy

Pakistan's FWO seeks four-year payback on Azerbaijan-funded oil pipeline

Monday, 7 September 2026, 06:38 · 1 min read

Pakistan's Frontier Works Organisation (FWO), a military-run infrastructure body) has filed a tariff petition seeking to recoup a $432 million investment in a new 437-kilometre petroleum pipeline within four years, with Azerbaijan's state oil company Socar as a key partner. The proposed Faisalabad-to-Peshawar white oil pipeline would charge an initial transportation tariff of $64 per tonne when it begins operations in 2029, declining to $14.50 per tonne by the end of a 30-year tariff period. The project, structured as a government-to-government initiative with Socar and Pakistan State Oil, is seen as strategically significant for completing a fuel-supply corridor from Karachi to Peshawar and reducing dependence on road tankers, though Pakistan's finance and power ministries have raised concerns over the dollarised returns and the speed of the payback period.

Sources
Dawn — FWO seeks 4-year payback for $432m Azeri-funded pipeline ↗︎
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