TAPI pipeline gas to cost India at least $10 per mBtu

Turkmenistan gas, supplied through a proposed $7.6-billion pipeline traversing Afghanistan and Pakistan, will cost India at least $10 per million British thermal unit (mBtu).

“Turkmenistan sells natural gas to China for $7.5 per mBtu. Gas through the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline is likely to be priced at least at this level,” an official said here.

Over and above the $7.5/mBtu has price paid by China, India will have to pay an additional $1.2-1.5/mBtu as wheeling charges, besides an equivalent amount as transit fee to Pakistan and Afghanistan for guaranteeing safe passage of gas through their territory.

“The delivered price of gas at the Indian border will be in excess of $10 per mBtu,” he said.

Petroleum Minister Murli Deora yesterday signed an Inter-governmental Agreement (IGA) and Gas Pipeline Framework Agreement for the TAPI pipeline.

The official said the agreements laid down the framework for implementation of the TAPI project, but issues like the price of gas and safe delivery of gas would be addressed separately.

At the signing ceremony, attended by Pakistan President Asif Ali Zardari, Afghanistan President Hamid Karzai and Turkmenistan President Gurbanguly Berdimuhamedov, New Delhi voiced concerns over the safety of the pipeline, which would pass through the Taliban stronghold of Kandahar, besides other restive tribal areas in Pakistan.

“There are issues that need to be addressed. We have to come to a decision regarding the price of gas, security of the pipeline, certainty of the gas supply, transit fee and setting up of the consortium (to build the pipeline),” Deora said.

A rival project for transporting gas from Iran to India through Pakistan through another transnational pipeline has been stuck on the drawing board for over a decade now on concerns over the safe passage of gas through the Pakistani territory.