Countries that are part of the UA$10 billion Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project have approved an acceleration plan in a bid to cut the time required for constructing the pipeline and make it ready before the deadline, disclosed an official.
The targeted time for completing the project was 2020, but now under the acceleration plan, the participating countries will be able to lay the transnational pipeline next year.
“Steering committee of the TAPI pipeline project has approved a plan in this regard,” the official said.
According to him, Pakistan had proposed a new plan for executing the project in the shortest possible time, which was approved by the steering committee. Under the plan, the pipeline will be laid without installation of compressors in the first phase.
Turkmenistan will pump gas into the pipeline without compressors. The pipeline’s diameter will be 56 in., therefore, only one-third of gas flow will be possible during that phase.
The official revealed that the pipeline had been divided into nine lots and successful companies from the bidding process would be asked to work on different lots to implement the project as quickly as possible.
Pakistan is currently importing liquefied natural gas (LNG) from Qatar and Italy and is in talks with other countries to sign more government-to-government supply deals.
Despite LNG deals, Pakistan needs more gas to meet needs of the industry. Seeing the growing appetite, different countries like Iran, Turkmenistan and Russia are vying to build pipelines for gas supply to Pakistan.
The Pakistan-Iran gas pipeline project had been conceived long ago, but it could not be implemented due to international sanctions on Tehran.
Russia has also planned to build an offshore gas pipeline from Iran to India via Pakistan. Russia has shareholdings in oil and gas fields across Iran and has been pressing Pakistan to sign a government-to-government deal for the offshore gas pipeline.
The US, on the other hand, has lent support to the TAPI pipeline (which will meet the energy needs of Afghanistan, Pakistan and India) instead of the Iran-Pakistan pipeline as it has had tense relations with Tehran for decades.
“This (TAPI) is a regional energy infrastructure project and will help ease tensions between neighbouring countries due to dependence on each other,” the official remarked.
Turkmenistan has huge natural gas reserves and a major chunk goes to Russia that supplies it onwards to Europe. Turkmenistan has also been providing gas for Iran and now its new markets will be Afghanistan, Pakistan and India.
Turkmenistan will bear 85% of the TAPI pipeline cost estimated at US$10 billion, whereas Afghanistan, Pakistan and India will have shares of 5% each.
The cost is in addition to the capital injection of US$15 billion required for developing the gas field from where Turkmenistan will transmit energy to the three countries.
A gas sale and purchase agreement had already been signed between all sides in 2013 to establish the pricing mechanism under which gas price at Turkmenistan’s border would be around 20% cheaper than the price of Brent crude oil.
Pakistan and India will each receive 1.325 billion ft3/d while Afghanistan will receive 500 million ft3/d.