Iran on Saturday pledged to forge ahead on a new gas pipeline project with Pakistan despite U.S. urgings to Pakistan to quash the deal. The U.S. has strongly opposed the pipeline out of fears that it would provide fresh infusions of foreign exchange into Iran’s economy at a time when the U.S. and western allies have imposed a strict sanctions regime on Tehran as part of efforts to prevent it from obtaining a nuclear weapon. The deal is noteworthy because it involves an Iranian company closely linked to Iran’s Supreme Leader and could potentially put Pakistan on the wrong side of the sanctions regime against Iran.

On January 30, Pakistan’s cabinet ratified a $1.5 billion agreement with Iran for the laying of nearly 500 miles of pipeline in Pakistan that would connect the country’s gas infrastructure to Iran’s massive South Pars natural gas fields. The pipeline would potentially add over 750 million cubic feet of gas per day to Pakistan’s grid at a time when the country faces crippling energy shortages with some cities suffering frequent protests against 20 hour-long power outages.

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