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Pakistan, Afghanistan, Turkmenistan and India on Tuesday signed Transmission Advisory Service Agreement (TASA) on Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project in Ashgabat. Talking to Business Recorder from Ashqabad, Mobin Soulat, Managing Director (MD) Inter-State Gas System (ISGS), said four participating countries inked the agreement, which will pave the way for construction of the 1,680km-long TAPI gas pipeline to bring 3.2 Billion Cubic Feet per Day (BCFD) natural gas to the country from Turkmenistan.

The MD ISGS said he along with Pakistani delegation reached Turkmenistan on Monday, November 18 to attend the two-day conference of the technical working group of the four stakeholder countries. This will enable the Asian Development Bank to act as transaction advisor to find a technically and financially sound company that could form a consortium to generate the finances for the $7.8 billion TAPI gas line that will span over 1,600 kilometres.

Soulat said the ADB representatives also attended the meeting wherein the TASA was signed. The Economic co-ordination Committee (ECC) of the Cabinet has already approved ADB as service advisor for the TAPI gas pipeline following in the footprints of other countries, which had earlier given nod to the ADB to act as advisor. Under TASA, the ADB will be charging a fee of $50,000 per month from the four countries meaning that every country will give over $12,000 per month. The gas line will provide 500 mmcfd gas to Afghanistan and 1.325 bcfd gas each to Pakistan and India. Afghanistan was earlier interested in the transit fee only, but later it signed the GSPA with Turkmenistan on July 2012 for 500 mmcfd gas. The consortium leader will pay $30 million to the Transaction Adviser on the date when the consortium leader assumes the responsibility. The gas will be imported from Yolotan-Osman gas field in Turkmenistan under TAPI gas pipeline of 56 inches.

The present cost of the imported gas from Turkmenistan hovers around $13 per mmbtu in Pakistan. To a question, he said that Turkmenistan-Afghanistan and Turkmenistan-India bilateral Gas Sales and Purchase Agreement (GSPA) were signed on May 23, 2012 followed by Turkmenistan-Afghanistan GSPA which was finally signed on July 9, 2013. The Gas Pipeline Framework Agreement (GPFA) was signed on December 11, 2010. TAPI parties agreed to form a Special Purpose Vehicle (SPV) as TAPI Ltd with four designated gas companies from the TAPI countries and proceed with this vehicle to undertake certain pre-project activities, including the selection of the consortium leader. According to sources in the Petroleum Ministry, Russian oil and gas giant Gazprom is keen to lay TAPI gas pipeline project.

Copyright Business Recorder, 2013


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