Govt will sign pact to import gas from Turkmenistan

India will this weekend sign key agreements to import natural gas through the US-backed Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline after diluting stiff terms it had laid for a rival project from Iran.

"The Union Cabinet yesterday evening approved signing of Inter-Governmental Agreement and Gas Pipeline Framework Agreement for TAPI pipeline project at a summit meeting of the four participating nations at Ashgabat on December 11," Oil Minister Murli Deora said here.

In a major departure from its previously stated policy of the seller delivering the gas at its border, India has agreed to take custody of the gas at Turkmenistan-Afghanistan border and will rely on an international consortium for safe transfer of the fuel through Afghanistan and Pakistan.

Whereas, as a condition to be part of the shorter, cheaper and easier-to-build pipeline from Iran, it had insisted on Tehran taking responsibility of safe passage of gas through Pakistan.

Also, Turkmenistan is not agreeable to making up for any shortfall or disruption in gas supplies, sources said.

While Pakistan Prime Minister Yousaf Raza Gilani and Presidents of Afghanistan and Turkmenistan are expected to participate in the summit, Deora will represent India.

Deora said that in the IGA, the four nations will commit to provide government support including security for the 1,700-km pipeline that may cost upwards of USD 10 billion. The GPFA would lay down terms of transporting gas through the pipeline that may take up to 5 years to build.

The twin agreements will be followed by negotiations on the price of natural gas and other commercial terms, he said.

"The signing of IGA and GPFA would set the framework for future implementation of the TAPI project," he said, adding that India and Pakistan will import 38 million cubic meters of gas per day each from Turkmenistan while Afghanistan will get 14 mmscmd.

New Delhi had previously raised security and financing concerns over Iran-Pakistan-India gas pipeline but appears to be satisfied about the line from Turkmenistan that would not just pass through Pakistan but also Afghanistan.

The TAPI pipeline is backed by Asian Development Bank (ADB), and the External Affairs Ministry sees it as an opportunity to project India's commitment to Afghanistan.

Turkmenistan will supply gas from its South Yoloten-Osman field and state-owned gas utility GAIL India will enter into a Gas Sales and Purchase Agreement (GSPA) with the Central Asian country's national oil firm Turkmengaz later.