TAPI’ng Along

Via the Khaleej Times, an updated report on the Turkmenistan-Afghan-Pakistan-India gas pipeline project.  As the article notes:

Turkmenistan-Afghan-Pakistan-India transnational gas pipeline, or TAPI, took a good step forward as Ashkabad and Islamabad have agreed on the illusive pricing formula and have vowed to complete it in the shortest possible time.

Pakistan and Turkmenistan, at the end of the just concluded negotiations at Islamabad, announced they will sign the agreement in Ashkabad on November 15. Its for a long time that Iran-Pakistan-India (IPI) and TAPI were planned to provide gas to the region. But, still without it, the two transnational gas pipelines are not ready, as Pakistan and India undergo their worst energy crisis.

Washington is trying to block the Iran-Pakistan-India (IPI) gas pipeline as part of its sanctions against Iran. US Secretary of State Hilary Clinton said in Islamabad last week “the international community will not like the pipeline to go ahead.”

India, virtually, has opted out of the project under apparent US prodding, but Pakistan, as of now, is still going ahead with it.

Despite good news on pricing formula, TAPI continues to be threatened by the increased intensity of the ongoing war and worsening security situation in Afghanistan.

The key buyers of the Turkmen gas to be supplied through a 1,640 kilometre pipeline and estimated to cost $ 7.6 billion are Afghanistan, Pakistan and India. Pakistan and India, each are expected to receive 1.365 billion cubic feet daily (BCFD), while Afghanistan will have 0.5 bcfd. US supports the project and Manila-based Asian Development Bank (ADB) has agreed to fund it. Pakistan and Turkmenistan have agreed to sign an agreement on November 15, at Ashkabad, to supply 1.3 bcfd of gas to Pakistan at 69 per cent of crude oil parity price, Petroleum Minister Dr. Asim Hussain, says. India already has bilaterally agreed on pricing ?with Turkmenistan.  

The negotiations opened with Turkmenistan Deputy Minister for Energy Yarmuhammad Orazgulyev offering the gas at 74 per cent of crude parity price. But as calculated on the basis of transit cost needed to be paid to Afghanistan, Islamabad considered it to be too high.

“The final price, Pakistan secured at he end of the negotiations works out at 69 per cent of the Brent crude parity at Afghanistan-Pakistan border, including the transit fee,” Pakistani Petroleum Minister Dr Asim Hussain says. Pakistan is expected to start receiving Turkmen gas by December, 2016, “depending on a credible security apparatus in Afghanistan,” officials said. There is yet another good feature of the agreement. Ashkabad has offered Islamabad to raise the  gas throghput from 1.3 to 2.0 bcfd if the two sides agree to transport 700 million cubit feet a day to Pakistani southern port of Gwadar, located close to the Straits of Hormuz, for export as liquefied ?natural gas (LNG). 

This entry was posted on Monday, November 7th, 2011 at 1:05 pm and is filed under Afghanistan, India, Pakistan, Turkmenistan.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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