Gas pipeline: Breakthrough in TAPI project

Independent company to be set up for execution of the project.

KARACHI: According to Indian media reports, the governments of Turkmenistan, Afghanistan, Pakistan and India have agreed to set up an autonomous company for the execution of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline by September this year, in a move that will prove to be a big boost to the long-delayed project.

According to MMSPL Research, Indian publication The Hindu reported that Dubai-based TAPI Ltd, set up by the Indian government, will scout for a consortium leader, which will build and operate the project, arrange finances and will be responsible for the safe delivery of gas through the pipeline, after other multinationals failed to step forward.



TAPI Ltd is required to have an initial contribution of $20 million, $5 million from each of the four participating countries.

According to media reports, the need for an independent company was pushed for by India, which preferred this option instead of each country constructing their portion of the pipeline.

The Deccan Herald quoted Indian Oil Minister M Veerappa Moily as saying that the pipeline will be completed by 2017.

“Turkmenistan has agreed to consider the request of giving a stake in the gas field (that will feed TAPI pipeline),” The Deccan Herald quoted Moily as saying. The necessity for selection of an appropriate consortium leader at the earliest was also agreed upon, he said.

“A positive ambiance for the steering committee meeting was created by signing of the Gas Sales and Purchase Agreement (GSPA) that had, so far, been pending between Afghanistan and Turkmenistan, thereby completing the explicit commitment of all four countries involved in the project,” Moily said.

There is as yet no confirmation from Pakistani authorities, however, according to the Indian press the decision was made in consultation with petroleum ministers of all four countries.

The TAPI pipeline is the US-sponsored alternative to the Iran-Pakistan (formerly
Iran-Pakistan-India) pipeline (IP).

According to analysts, the TAPI pipeline, which originates in Turkmenistan and flows through sensitive territory in Afghanistan and then goes through Pakistan to India, will bypass Iranian influence in the region and create a source of income for Afghanistan after US forces withdraw.

Support for the TAPI pipeline increased after India withdrew from the IP pipeline. Pakistan and Iran have decided to go ahead with the IP pipeline without India, but it seems energy-starved Pakistan is also considering the TAPI project for additional gas.

Published in The Express Tribune, July 13^th, 2013.

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