Pakistan links TAPI work initiation with gas price review

ISLAMABAD: In a major development, Pakistan asked Turkmenistan to review the gas price deal under $8 billion TAPI gas before ground breaking of the pipeline to be laid down in Pakistan’s territory, one of the top men in the Petroleum Division told The News.

A high-power delegation of Turkmen gas company is to visit Pakistan by end of the current month and would start talks with Pakistani side.

“Yes, we have written a letter to Turkmenistan authorities five months back seeking the dialogue for review of the gas price downward before embarking upon the construction of the portion of the pipeline in Pakistan’s territory and in latest interaction with authorities in Turkmenistan during the board meeting held in Ashgabat where in top authorities from Pakistan, India and Afghanistan participated and to this effect Special Assistant to PM on Petroleum Nadeem Babar asked the authorities of Turkmenistan to first review the gas prices downward before initiating the project,” a senior relevant official confirmed to The News.

The three buyer countries — Afghanistan, Pakistan and India -- had inked the gas sale-purchase agreement with Turkmenistan on bilateral basis. Now all the buyer countries want to unfold their prices and want the renegotiations. However, Turkmen gas company is going to send its team to Pakistan by end of June.

Another senior official said that on June 17, a delegation is due from Turkmenistan to sign Host Government Agreement and after that Turkmen Gas Company will send its experts team to review the gas price.

To a question he said that the financial colure of the project is to be completed by September this year and ground breaking would be held in October 2019 for laying down the 800 kilometre portion of TAPI line in Pakistan territory. The project will be operational by 2020. The pipeline from Afghanistan that will enter from Chaman and pass through Zhob, DI Khan, Quetta, Multan and touch the Fazilka — a city at Indian border which is 150 kilometer away from Multan. From Fazilka, the pipeline will enter India.

TAPI gas pipeline project aims to bring natural gas from the Gylkynish and adjacent gas fields in Turkmenistan to Afghanistan, Pakistan and India. The ADB is acting as the facilitator and coordinator for the project. It is proposed to lay a 56-inch diameter 1,680KM pipeline with design capacity of 3.2 billion cubic feet of natural gas per annum (Bcfd) from Turkmenistan through Afghanistan and Pakistan up to Pak-India border. There are two phases of this project, the first phase is free flow phase with estimated cost of $5 to 6 billion while second phase is installation of compressor stations with the cost of $1.9 to 2 billion. Civil works of the project have already commenced in Afghanistan after the project’s ground breaking (Afghan section) was held last year.

Afghanistan will be having the gas under TAPI 500 mmcfd, Pakistan 1.325 bcfd and India 1.325 bcfd too. Turkmen gas company being the Consortium leader for the TAPI Project is to contribute up to 85 percent of equity, and the rest of TAPI members namely Afghanistan, Pakistan and India would take 5 percent each equity share in the Project Company.