TurkmenGaz to lead TAPI pipeline consortium

French giant Total SA had initially envisaged interest in leading the consortium

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Turkmenistan’s government-owned TurkmenGaz will lead a consortium of the national oil companies of the four nations that will build and operate the ambitious Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, the petroleum ministry said without clarifying whether foreign private companies can still participate in the $7.6 billion project.

“Turkmenistan proposed that its state-owned company TurkmenGaz would lead the consortium for the TAPI project with a majority investment. All sides endorsed the Turkmen proposal,” the ministry said. The ministry added that Petroleum Minister Dharmendra Pradhan, is leading the Indian delegation to a steering committee meeting of the project in Ashgabat.

Pradhan is accompanied by senior officials from the Ministry of External affairs, the petroleum ministry, GAIL (India) Chairman B C Tripathi and ONGC Videsh Managing Director N K Verma.

During the meeting held on Thursday, it was agreed that the four countries involved will own the project and take steps for early implementation.

“It was agreed that all sides would invest in the project subject to a techno-commercial viability, shareholders’ agreement and investors’ agreement,” the  ministry said.

Work on the TAPI project is yet to commence as the four nations that are party to the project have so far not succeeded in finding an international firm that could lead the consortium that will construct and operate the 1,800-km pipeline. French giant Total SA had initially expressed interest in leading the consortium of the four nations. However, it backed out after Turkmenistan refused to accept its condition for a stake in the gas field that will feed the pipeline.

The TAPI pipeline will have a capacity to carry 90 million standard cubic metres a day (mscmd) gas for a 30-year period and be operational in 2018. India and Pakistan would get 38 mscmd each, while 14 mscmd will be supplied to Afghanistan. From the Galkynysh field in Turkmensitan, the pipeline will run to Herat and Kandahar province of Afghanistan, before entering Pakistan. In Pakistan, it will reach Multan via Quetta before ending at Fazilka (Punjab) in India.

The decision follows Prime Minister Narendra Modi’s last month visit to Turkmenistan in which he stressed upon early implementation of the pipeline. The decision will give a “fresh impetus” to start work on the Turkmen segment of the pipeline in December this year, the ministry said.